Spotlight on Men's Wearhouse CEO
The menswear market is hot. Men’s apparel sales in the United States rose 2% in 2014 to $61.3 billion, up from $60.8 billion in 2013.
And Men’s Wearhouse — one of North America’s largest menswear specialty retailers with 1,758 stores — has been taking note.
The retailer is capitalizing on the category’s growth via acquisition-fueled expansion, new designer collections and more customized products and service. (At press time, Men’s Wearhouse signed an agreement with Macy’s to operate tuxedo rental shops inside 300 Macy’s stores.)
That’s been the strategy of Doug Ewert, CEO of Men’s Wearhouse Inc. Since taking the helm in 2011, Ewert has overseen the company’s acquisitions of competitor Jos. A. Bank and the Joseph Abboud designer brand in 2014 and 2013, respectively.
Ewert spoke with contributing editor Barbara Thau about Men’s Wearhouse’s growth strategy, which includes offering more custom-made clothing and highly personalized service, as well as its active courtship of millennials — the generation born between 1980 and 2000 that’s poised to become the nation’s biggest consumer buying group by the next decade.
What is the current status of the men’s apparel industry?
Over the last two years, men’s retail sales have increased at a higher rate than women’s retail. In general, we find that men are taking greater care in their grooming and appearance. And this has resulted in menswear labels delivering fresher takes on the male look and also rethinking how men want to shop. The millennial generation especially has placed a great emphasis on the personalization of clothing. This younger demographic is much more comfortable mixing and matching different elements than previous generations and creating more individualized looks.
Tell us about Men’s Wearhouse’s evolving strategy.
We built our business offering personalized wardrobe consulting and expert tailoring, and recently we added custom clothing to our product offerings, leveraging our domestic Joseph Abboud factory. For only $100 more than an off-the-rack suit, we can offer a designer suit made in our U.S. factory with over 150 fabric choices tailored to specific measurements, customized with personal touches and delivered within three weeks. Later this year, we plan to introduce custom dress shirts.
How has this impacted brick-and-mortar?
We have found that our customers are placing greater emphasis on the fitting process in men’s clothing — especially for suits and tuxedos. I believe that our customized tactile experience has led to a greater demand for brick-and-mortar stores around the country.
We will open 50 more stores over the next two years and further our reach to the 70% of the American population who lives within 10 miles of one of our stores. And this past April, we opened the flagship Joseph Abboud brand store in Manhattan.
What is Men’s Wearhouse’s niche in the market today?
We offer best-in-class service; convenient locations; and a curated assortment of high-quality menswear targeting men of all ages, sizes and fashion demographics.
What are the biggest growth opportunities?
We see opportunities to grow by winning a larger share of our customers’ closets through a highly engaging, omnichannel service experience. We hope to continue to expand our offerings in casual wear, business casual wear, and custom clothing offerings by leveraging our recent acquisitions of Jos. A. Bank and Joseph Abboud. And of course, we continue to expand our relevance with millennial customers in all of our brands through trend-right products and personalized service.
How would you assess Men’s Wearhouse’s performance year-to-date, and what’s driving the business?
Our legacy businesses all saw healthy growth in 2014 as customers responded to our offerings and value proposition. Our total sales for the year were approximately $3.3 billion, and our legacy businesses had a total sales growth of 3.9%.
In the past few years, there has been a trend toward dressing up. We see men often pairing suits with button-downs and jeans. With our recent acquisitions, we’re looking to cater to this trend by offering selected, exclusive pieces for the modern man.
What retailers do you see as competition today?
We pay close attention to a wide spectrum of competitors from traditional brick-and-mortar retailers, such as Macy’s, Nordstrom and J.C. Penney, to the emerging e-tailers like Trunk Club, Bonobos, J.Hilburn and Black Tux. It’s particularly interesting to see the pure online players now also expanding to brick-and-mortar stores. This validates what I have emphasized all along about the personal attention and consultative approach to helping men dress with confidence, which has been our model at Men’s Wearhouse since inception.
Who’s your target audience today, and how is that changing?
We have always focused on men aged 17 and above, representing different fashion demographics with different clothing needs for every budget. We are now seeing the most growth among our millennial customers who no longer shop only during prom and graduation season but are also looking to expand their wardrobe with formal wear as they enter the workforce. We also see our customers’ needs evolving to integrate more personal tech into their clothing, whether it’s a smartphone device or a tablet. Men’s Wearhouse will be making some exciting product announcements in the near future that offer the best in both wearable and fabric technology. Stay tuned.
How is Men’s Wearhouse courting them?
The younger generation is all about the fit, and we have tailored our offerings so that 45% of our assortment is “slim fit” or “extreme slim fit.” We’ve seen that millennials often go for the urban casual look, which includes elements of formalwear worn in a more laid-back fashion. For that style, we have introduced sport-coat and blazer assortments, which include “soft” jackets that have less constructed shoulders and more textured fabrics for a casual look and feel. We also target millennials with our tuxedo rental business, which attracts both wedding-age customers — 27 is average — and prom-age customers — 17 is average.
What’s the strategy behind the addition of the Joseph Abboud brand?
Joseph Abboud targets an aspirational customer who appreciates higher-quality menswear. Made in our U.S. factory, we offer a premium-quality suit using the finest Italian fabrics for around $600. For $100 more, our customers can order a custom suit delivered in three weeks. About 50% of the Abboud customers are shopping at Men’s Wearhouse for the first time.
What is Men’s Wearhouse’s price point range, and how is it changing?
We have rental styles for every budget, starting as low as $59. Ove