Mickey Drexler Has A Crucial Quality That Most Executives Have Lost
This is the fourth of the six-part "Inspired to Strive" series, in which business leaders of middle-market companies share their stories of success. "Inspired to Strive" is sponsored by CIT.
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The J. Crew CEO is called the "Merchant Prince" and the "man who dressed America" because of his keen eye for apparel that sells out. He's been the force behind many classic trends such as khakis and casual Friday attire.
Drexler is credited with taking Gap from a small denim chain to a global powerhouse, and accomplishing a similar turnaround at J. Crew.
"It's almost like he's built into his DNA a supernatural, intuitive ability to spew forth great style and design," said Robin Lewis, author and CEO of The Robin Report, a retail newsletter.
But Drexler is more than a great merchant.
His success in retail is cited as evidence that retailers need people with impeccable taste and strong gut instincts to survive. Retail leaders can't rely on numbers and data for success.
"We've lost that sense with a lot of CEOs of what retail is about, and that's merchandising," said Brian Pitera, a principal of consultancy A.T. Kearney.
MANAGEMENT STYLE
Drexler is a hands-on leader, and no task is too small if it makes the business better.
Pitera, who used to work for Gap, recalled one of his favorite memories of working for Drexler in the late '90s. Employees had stayed up all night preparing to open the first Gap Body store, when Drexler walked in at 8 a.m. "We had the walls set, and the merchandise ready to go," Pitera said. "But Mickey just shook his head and said 'it's all wrong.'" Soon, Drexler had corralled employees and began frantically moving merchandise around the store.
"We were throwing around bras, pajamas, sweatpants, and Mickey even got up on a ladder," Pitera said. "He didn't stop working until the store looked exactly as he had envisioned."
That anecdote indicates how Drexler led Gap, Pitera tells us: "He creates a really clear point of view of who the company is, what the brand means, and how consistent that brand stays."
Drexler has stayed true to this hands-on approach at J. Crew. "(Drexler) discusses moccasins, overalls, belts, boatnecks, peaches, Apple, Lady Gaga, sizes, colors, styles, seams, competitors, operating margins, units per transaction, and average dollar sales," The New Yorker writes. "One morning, he let everyone know that he’d had a dream the night before about the color heather gray."
At the brand's headquarters in New York, Drexler installed a speaker system so he can communicate with employees throughout the day.
A BOY IN THE BRONX
Drexler grew up as an only child in the Bronx. His mother, who died when he was 16, was a secretary. His father worked as a button buyer for a coat company in the Garment District.
Drexler's love for retail could be rooted in his aspiration for better things. Much of his childhood was spent “being in a certain life and imagining another life," Drexler told the New Yorker in a 2010 profile.
After graduating high school, Drexler studied at the City College of New York and the University Of Buffalo. He later received an MBA from Boston University. To this day, Drexler likes to hire people with humble backgrounds and said he doesn't respect normal resume accolades like high grade-point averages or studying abroad.
"What matters is hard work, and emotional intelligence," Drexler said earlier this year. "People put ‘study abroad’ on their resume. I actually like when they don’t study abroad because that means they aren’t entitled."
"What about study abroad will make you a better J.Crew associate?" he asked. "I hire a lot of waiters, waitresses. Someone who’s successful has a background that’s not predictable."
SCARCITY IS VALUE
Drexler is known for his uncanny ability to select good merchandise, but his talents don't end there, retail expert and author Lewis told us.
"He once said 'I don't ever want to be in a business where I don't control my distribution, period, end of sentence,'" Lewis said. "He is great at creating scarcity in his stores and making people long for his products."
Lewis said that Drexler briefly lost sight of this vision during Gap's heyday, and began expanding stores too quickly. He later went back to his old strategy.
"I consider a merchant someone who has a certain intuition and instinct, and — very important — knows how to run a business, knows the numbers," Drexler told The New Yorker. "Does the merchandise speak to you numerically? There’s a rhythm. You see goods as numbers. You see stores as numbers. And the numbers have to work out."
This approach is different from most retailers, who rely on promotions to get people in stores, Pitera says: "Too many retailers today have so many sales that people don't visit the store until there's a promotion, which totally destroys brand equity. Mickey Drexler gives people reasons to keep coming back to his stores."
Instead of packing stores full of items, Drexler is selective and only features the best, Pitera said. This is better for long-term brand value.
STILL CURATING COOL
Drexler has been known to invest in new brands he thinks has great potential.
Most recently, he was reported to have invested in vintage eyeglass company Warby Parker. “He was excited about some of the exciting retail stuff we were doing,” Warby co-founder Neil Blumenthal told DealBook. “When it was time to raise money, we wanted to get him formally involved.”
Drexler also helped put jewelry designer Lisa Salzer on the national scene. After creative director Jenna Lyons showed Drexler her eclectic designs, he said he thought it was "incredibly creative and like nothing I have ever seen." Today, some of Salzer's pieces are sold at J. Crew.
Drexler even trekked to Portland, Maine, to check out some "Sea Bags" products, The New Yorker wrote. The company makes bags out of old sails.
"“This is like discovering gold," Drexler said excitedly. "This is it."
IMPACT ON INDUSTRY
Drexler is one of the most successful living CEOs, said Mark Ellwood, retail expert and author of the upcoming book "Bargain Fever."
"How many other fashion executives can claim to have made household names out of not one, but two, brands? The Gap story was one success, but to rise phoenix-like at J.Crew?" Ellwood asked. "Wow."
While far too many executives have become "Wall Street puppets," Ellwood points out, Drexler's loyalty to his instincts has paid off.
His perfect mix of business sense and good taste will be studied by business schools for years to come, Lewis says. "He doesn't abide by or live by any textbook process of retail or fashion creation or merchandise. He'll go down in history as representing the standard of the quintessential merchant."