Dive Brief:
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J. Crew has hired former Ann Inc. CFO Michael J. Nicholson to be its president, COO, and CFO, starting Jan. 11, the retailer said.
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The company reported a Q3 loss of $759.7 million, compared with a loss of $607.8 million year over year. Sales at its J. Crew brand dropped 8.6%, restricting revenue to $619.4 million. Q3 same-store sales fell 11% compared to the 2% drop year over year, and gross margin dropped to 38.6% from 40.2% year over year, the retailer said.
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This summer the retailer laid off 175 people from its New York City headquarters and tapped the design chief of its Old Navy-like Madewell brand, Somsack Sikhounmuong, to be J. Crew’s women’s design chief, replacing Tom Mora.
Dive Insight:
J. Crew is one of many apparel retailers that seem a bit lost in an era when many consumers seem less interested in investing in clothing.
And quality issues are alienating some of its biggest fans, who in the past would keep their clothes for decades, but in recent months have reported less quality that they say is turning them off. This summer, CEO Mickey Drexler promised to bring back the retailer’s “iconic classics,” but it’s not yet clear what that really means for the company’s approach.
J. Crew, like Urban Outfitters and Gap, is also now an apparel retail company with a sub-brand that is helping soften the effects of falling sales. Like Gap’s Old Navy brand, Madewell is shaping up to be a lower-priced alternative with a more focused style, and both the price points and the clothes appear to be appealing to shoppers. Perhaps that’s no surprise, given that Drexler himself is the one who conceived of Gap’s less expensive Old Navy brand years ago.