Jos. A . Bank sales are crashing after it killed the main reason men shopped there
The retailer famous for its aggressive discounts ("buy one get seven free!") will release a new strategy this fall to help salvage itself, Bloomberg reports.
The company has already begun to cut back on its ridiculous discounts - which were lampooned by Saturday Night Live.
But simply cutting back on discounts hasn't helped business.
Second quarter earnings disappointed; same-store sales dropped 9.4%. Just a year ago, same-store sales had increased 1%. Analysts blamed the sales slump on customers coming to stores less frequently.
"Moderating promotional activity is extremely difficult for Jos A. Bank, which has come to rely on highly generous offers (such as buy one, get three free) in order to drive customer traffic and [spending]," Neil Saunders, CEO of consulting firm Conlumino, wrote in a recent research note.
Ultimately, these discounts were one of the main reasons men shopped there in the first place.
So what will ultimately save the struggling retailer?
Enticing younger customers could be a part of the plan. After all, the retailer, which was acquired by Men's Wearhouse last year, has been steadily trying to win over younger customers.
"It's this focus on newness that will give us the best shot at winning a larger share of closet with existing customers and expanding our reach to new and younger customers," Men's Wearhouse CEO Doug Ewert said on a recent earnings call.
"Bottom line: We need to give customers new reasons to shop at Jos. A. Bank and [give] our stores more ammunition to grow their business," he added.
That means that the outrageous discounting won't come back.
"There's a fair amount of evidence out there that there aren't enough customers who want to buy four suits at a time or want to buy that quantity to get a deal," Ewert said to Bloomberg. "Taking away the unnatural quantity discounts will lead to more healthy transactions. Instead of a guy buying four suits and then we don't hear from him for quite a while, we can sell him a suit and shirts and ties and maybe some shoes."
"We see so much opportunity, and we're anxious to start getting some customer feedback," he said to Bloomberg.