Mike Jeffries
61, CEO, Abercrombie & Fitch
By Kristina Zimbalist
Fall 2005 Style & Design
Of all the CEOs of $2 billion companies who have peculiar obsessions,
Mike Jeffries is perhaps the only one fixated on the college years. He
has rumpled blond hair and a lacrosse captain's tan and speaks with a
nicest-guy-at-the-party lilt. Meetings in his office, a giant living
room of sorts, are held at a massive circle of tables with no head. When
he gives an O.K., he doesn't say "Let's go with it" but "Cool."
Everything from his physique to his enthusiasm is irrefutably, uncannily
young.
His pep-rally fervor may best explain how Jeffries has managed to steer
Abercrombie & Fitch—the clothing megacompany that worships, and is
worshiped by, college students—through much hyped highs and notorious
lows to become the hottest and fastest growing brand in its category. In
June, Abercrombie reported a 52% increase in sales, with year-to-date
sales reaching $973 million. Last year, the employee head count doubled,
an expansion that included new president and COO Bob Singer, hired away
from Gucci. Jeffries has launched three new labels—abercrombie,
Hollister and Ruehl—and increased stores to 800 nationwide. A flagship
is scheduled to open later this year on Fifth Avenue and 56th Street in
Manhattan. "It's been one of the best-growing retailers in sales and
square footage in the past 10 or 15 years," says Brian Tunick, a retail
analyst at J.P. Morgan in New York City.
Abercrombie & Fitch was founded 113 years ago as a sporting-goods
company that served the likes of Dwight Eisenhower and Theodore
Roosevelt. By the time Jeffries came along, in 1992, the company was
targeting customers "from 90 to death," he likes to say, and losing $25
million a year. Inspired by Ralph Lauren's country-club preppies,
Jeffries dreamed up a brand that would represent that customer's younger
(and hipper) siblings. He upped the sex quotient and knocked off two or
three generations in age. The target customer today is "the great
American college kid," Jeffries says. "It's the first time most kids
have freedom. We treat the brand as something that's very honest to
those kids."
Every stitch of the company reflects Jeffries' idealized college life.
Its three-year-old headquarters takes the form of—what else?—a campus,
located in wholesome New Albany, Ohio. In fall and winter, a bonfire
burns, all the better to conjure logoed Henleys. Jeffries hires
employees as close to his customers' age as he can and, as a walk around
the campus demonstrates, everyone looks 17. After lunch, the "kids," as
Jeffries calls them, exit the cafeteria and hop onto Razor scooters to
get to their desired building. Within those buildings, "kids" lead
meetings of "kids," designing and marketing and merchandising clothes to
peers very close to their own ages. "If you go to Seventh Avenue or a
lot of retailers, it's not true," Jeffries says. "They sit in a room and
say, 'What would "those people" like?' not 'What do I like?' And it's a
big difference. Part of having so many young people around is that
honesty, authenticity, is key."
Jeffries roams the campus in flip-flops, jeans and the company's famous
"muscle fit" polo shirts. If there is any doubt about what makes him the
ideal head of such a company, just get him talking about polo shirts.
"Our male customer is a masculine, in-shape guy, and that's what we
tailor this clothing to," he says. "If the sleeve and cross shoulder are
too long, you look like an old geezer."
Jeffries' obsession with college kids is not universal: it is limited to
the cool ones. "If you are 600 lbs., this ain't the place for you,"
Jeffries says candidly. "You can't take care of everybody." In its
high-speed chase after beautiful people, Abercrombie has collided with
controversy. Jeffries discontinued the company's famous, overtly sexy
catalogs, photographed by Bruce Weber, in 2003, following threats of
massive store boycotts. And this past July the company settled a $40
million class action that alleged discrimination against Asian,
African-American, Latino and women workers.
The fashion has at times faltered as well. From 2000 to 2003 the company
reported negative same-store sales. The trends were surfer and skater,
not student. But a recent resurgence in preppy looks has returned the
ball squarely to Abercrombie's court. And new COO Singer has hiked price
points, landing Abercrombie in the casual-luxury category, a positioning
that spans the Abercrombie & Fitch brand, its higher-priced Ezra Fitch
offshoot and the newly launched Ruehl, a label offering New York City
styles to twenty- and thirtysomethings.
"People say, 'Do you have a vision as to where this is going?' And the
answer is, absolutely not," Jeffries says. But there is one thing he
knows for sure. "You can't have ego," he reports collegially. "Every
day, we're afraid."
|
Premium Content