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Men’s Wearhouse Idea Proposal

Men’s Wearhouse Idea Proposal
 

Research Question: Will the ending of Jos. A. Bank’s aggressive promotions and its focus on a younger demographic revitalize the brand?

Report Available: Nov. 20. 2015

 

Blueshift’s initial research shows MW finally pulling the plug on Jos. A. Bank’s aggressive promotional strategies and attempting to inject life into the chain with a new line of suits that should appeal to a younger demographic. But Bank’s existing older customer base could be hooked to the steep discounts and may withdraw from the brand as it focuses more on millennials.

 

Observations

  1. MW’s Q2 earnings saw EPS ahead of analysts’ estimates and comps up 3.1%, driven by higher average unit retails, but growing slower than recent quarters due to continued declines in rental revenue. Jos. A Bank comps fell 9.4%as results revealed declines in transactions per store and units per transaction. Management acknowledged the brand’s “struggle” while reiterating previous EPS guidance.
  2. MW pledged (again) to establish a new and clear marketing message for Jos. A Bank and distance itself from “unusual quantity requirements” in promotions. Management also noted, “this fall we will be well positioned to fully implement our strategy as all systems will be integrated.” The company is launching a new line for Bank, called 1905, which would target a younger demographic. A recent brand index found that Jos. A. Bank was the most improved brand from the prior year.
  3. Some are questioning whether bringing in new youthful designs is the right strategy for Jos. A. Bank given that its past customer base has been an older demographic. The new styles that appeal to millennials and the ending of its bounteous promotions could alienate the Boomers and older Gen Xers that frequented the store.
  4. Blueshift’s May 28 report found little change in store operations or promotional strategy since MW acquired Jos. A. Bank stores over a year ago. There was no evidence of inventory or POS system integration, aside from new kiosks for formal wear sales and rentals at Jos. A. Bank stores. Six sources said Jos. A. Bank continues to rely on discounts to clear its inventory, and four said the chain will be hard-pressed to attract younger shoppers while retaining its older customer base. Five sources noted that MW stores have been featuring more fashionable, trendy merchandise and drawing in younger customers.

 

Will MW ending Jos. A. Bank’s promotions and retargeting a younger demographic be the right move? Will sales sink further at Jos. A. Bank now that quantity promotions have permanently ended? Will the 1905  line and other MW brands showing up on Jos. A. Bank shelves sell? What is the latest on the integration of Jos. A. Bank into MW? To gain insight into Men’s Wearhouse and Jos. A. Bank, Blueshift will gather data and issue a market research report from independent sources in the following areas: Men’s Wearhouse and Jos. A. Bank associates, competitors, supply chain, and industry specialists.

 

Companies:  Men’s Wearhouse (MW), Macy’s (M), Nordstrom (JWN), Ralph Lauren (RL), PVH Corp (PVH), Kohl’s (KSS), Gap (GPS), JC Penney (JCP)