Zale chief executive officer Neal Goldberg recently spoke to JCK about his chain’s plans for the future.
Goldberg came to Zale after serving as president of The Children’s Place, the noted children’s retailer. In his talk with JCK, he stressed—as he did in a speech at the Rapaport Diamond Conference—that the industry needs to offer more-differentiated product and a more compelling shopping experience. Following are some highlights.
How have your years at other retailers shaped your view of the jewelry industry?
I have been blessed to work with some great retailers and some really talented people. Those people always think about the consumer. They think about what the consumer wants. As I mentioned at Rapaport, what I see in this business is a sea of sameness. It’s all about price, and there is no romance to it. The way the goods are presented is very flat. I was never inspired walking into any jewelry store to say, “Wow, look at this presentation.” You go into other retailers, other commodities, and you do go, “Wow.” Apple is probably the pinnacle of that. But there are others.
You seem to be reaching outside the industry for talent. What is the thinking behind that?
Let me be clear: I am not seeking out people with no industry experience. I am seeking out the best retail talent. I believe in finding the best talent and putting the best talent in the game. We have some very experienced diamond experts and a sourcing team with years and years of experience. Retail is retail. The people who win are those that make the shopping experience compelling and make the merchandise compelling.
So what should people expect if they go into a Zale’s store in two years?
We will have different product from the competition. There will be a lot more newness. Part of the “Celebration” theme is to create a sub-brand that has more of a lifestyle focus. We will use our creative abilities to do creative presentation of product. You will have people selling our product that are friendly and knowledgeable and not giving a hard sell—but really want to help educate people.
It’s a lot to do. A lot of people ask: Is this doable? My question is: What’s the alternative? Right now we have one company that says let’s do Journey and then every company does Journey. I believe each company has to create new product. We will miss on some; we are not looking to swing for the fences every time. I think that most people say if we don’t have new, compelling product the industry will die. You will end up having one retailer. I don’t think these thoughts are radical. They are business 101.
Does the $100 million in clearance you’ve done detract from the message of emotion?
We had to get out of a lot of product. Part of the whole clearance strategy is that it lets you create fresh assortments. The woman who is walking by the mall doesn’t want to see the same thing every day. If we have quicker turnover and better visual presentation of the product, then you have twice as much chance of selling than you did before.
We have a lot of years of cleaning up to do. In mid-October, the new product will start arriving in stores, and that is when the campaign will really begin and you will start to see the message “Zale equals love.” Our advertising will be much more about product supported by price. It’s not going to be the Crazy Eddie advertising of the past.
With your new focus on sentiment, does that mean Zale will be more of a bridal store and less fashion oriented?
No, I would say we are going to be about diamonds and emotion. I would disagree with the [premise of the question]. I don’t think any other business has a product that evokes more emotion than the jewelry business—whether it’s solitaires or even watches. I get a nice watch and it makes me emotional.
We are the diamond store. We are going to be focused on diamonds. But our pricing will be competitive. We are about value. We are not going to give that up.
How are the problems in the economy changing how you do business?
I just got back from India and China, and even there you are inundated with CNBC. So clearly the macros are scary. That said, I still think people are going to buy jewelry and the customer still wants a great assortment of product and great customer experience. We just want our unfair share of the business.