Jack Mitchell, CEO of the Connecticut-based clothing specialty store Mitchells/Richards and author of the best-selling book Hug Your Customers, was the keynote speaker for the final day of Luxury by JCK.
His talk was lively, entertaining, and highly motivational. He began by outlining the firm’s history and explaining how its customer-focused approach grew into the “Hug” book.
“Hug is a metaphor for any caring service that touches your customer,” he said. He recounted an apparel executives’ conference in the 1990s at which he was a member of a panel discussion. All of his fellow panelists issued warnings about the Internet and predicted that high-end men’s and women’s clothing would soon be sold only online. Another panelist was concerned about the growth of “big box” category killer stores.
When it was Mitchell’s turn to speak, he asked both his fellow panelists and the audience, “What about the customers?” and outlined the Mitchell’s customer service philosophy. At the end of his impassioned presentation, one of his fellow panelists turned to him and said, “Next you’re going to tell us you actually hug your customers.” That, he said, was the genesis of the book and the foundation upon which all future business strategies for Mitchell’s would be made.
He continued by relating multiple anecdotes relating how customers have been not only satisfied but also amazed by the services Mitchell’s provides, including sewing a button on a tuxedo (not a Mitchell’s tuxedo) for Lou Gerstner, then CEO of IBM.
“We were asked, back in 1989, if we knew our customers better than we knew our inventory, and we couldn’t say yes,” Mitchell explained. “We decided right then and there to SKU all our customers.” He described the database the store keeps on every customer, which includes not only past purchases but also preferences such as whether or not they drink coffee or cappuccino, Coke or Pepsi. Keeping that kind of database allows a retailer to make customers feel “hugged” when they come into the store and also helps a retailer tailor his or her marketing to the individual. By individually targeting marketing, both the retailer and the customer benefit. The customer feels that the retailer really understands and is concerned about his needs, and the retailer can make more effective use of his marketing dollars.
“You don’t want to send an invitation to a Hickey Freeman trunk show to a customer who wears Dolce and Gabbana suits,” he said, citing as an example a very traditional, classic menswear line versus a very fashion-forward one.
As a result of the store’s customer-focused and individualistic philosophy, 70% of its business is done at full price, said Mitchell.
Mitchell also discussed some critical issues that arise in running a family business. Mitchell’s/Richards is still a family-run business with multiple generations of the family involved in it. One iron-clad rule is that all children who want to come into the business have to work somewhere else for five years first, and that once they’re in the business they’re expected to work hard—it’s not an entitlement position. He also advised jewelers in a family business to work with an outside consultant and an outside advisory board and not to be afraid to have tough conversations as long as it’s open and honest communication.
He rounded out his presentation by discussing the need to also hug one’s associates. “Hug the huggers,” he called it, letting slip that this will be the title of his forthcoming book. He’s a firm believer in using psychological profile testing when hiring, and he also emphasized the need to hire positive people who are competent for the job they’re hired for and who are nice.
Retailers in the audience were inspired by his presentation, and many said that although much of what he says is common sense, it’s important to remember to do it.