DISCUSSION
Madewell is on the way up, J.Crew is not
Written by RetailWire Staff
Photo: RetailWire
Having just appointed its first CEO, the Madewell clothing brand may be pulling farther ahead of, if not completely away from, its struggling parent company, J.Crew.
Earlier this month, Madewell announced the appointment of Libby Wadle, formerly the brand’s president, as the company’s first CEO, according to Fortune. Ms. Wadle told the magazine that the brand intends to become a billion-dollar company in short order, doubling its annual revenue. She pointed to a focus on denim as the prime way for Madewell to continue its ascent.
Social responsibility (including a jean recycling program) and a willingness to partner with D2C brands are additional factors that Business Insider pointed to as reasons for Madewell’s success thus far. The brand was launched in 2006.
The news of the plan to make Madewell a standalone force in apparel comes as J.Crew continues to struggle. Throughout 2018, J.Crew posted quarterly losses and pursued a failed rebranding attempt that Fashionista identifies as one of many unsuccessful moves to get the once popular mall brand back on track.
J.Crew has made a few other notable moves that have indicated some confusion about the best path to a turnaround. The company began selling its off-price Mercantile line on Amazon Marketplace, but shortly thereafter decided to phase out the brand entirely. The back-and-forth presumably resulted from conflicting perspectives on how to improve the chain as seen by chairman Mickey Drexler vs. former CEO Jim Brett, who left around the time the line was discontinued.
The jettisoned sub-brand strategy appears to have further pushed J.Crew along a downward spiral, leaving the company with so much excess inventory that it was forced to discount, which led to big losses, according to Fashionista.
The relationship between J.Crew and Madewell, in which a more popular sub-brand keeps the flagging parent brand afloat, has evoked comparisons with Gap and Old Navy. The latter situation, however, changed earlier in the spring with the announcement that Old Navy would be spun off as a standalone company.
- Exclusive: Madewell Appoints Its First-Ever CEO, Brand President Libby Wadle – Fortune
- J.Crew's 2018 Relaunch Failed, and It's Suffering the Consequences – Fashionista
- What will going separate ways mean for Gap and Old Navy? – RetailWire
- Is J.Crew’s new Amazon relationship already over? – RetailWire
- Young retailers like Madewell and West Elm are driving major growth for their parent companies — we broke down the factors of their success – Business Insider