Technology has shifted the balance of power from brands to the individual consumer. No longer is a consumer confined to selections on display in store windows, hours of store operations, or waiting for semi-annual sale prices. Today, a consumer can view hundreds, if not thousands, of goods, compare prices, and place multiple orders from their smartphone, all in the time it takes to brew their morning cup of coffee. The rules of competition have changed, and experience is now the best place to differentiate your brand in the marketplace. Heed the lessons from two large US brands, J. Crew and Dominos, who are heading in opposite directions, primarily because one failed to understand how technology and experience are the new measures of competition in the marketplace. J. Crew, one of the top 200 largest private companies in the US, is currently at risk of falling into bankruptcy. Sales have slumped for 2 years, and this past week famed CEO Mickey Drexler agreed to step down as CEO of J. Crew. Mr. Drexler is considered a giant in the retail industry, having built brands such as Old Navy and Banana Republic, earning him the nickname the, “Merchant Prince”. However, even a prince can turn into a pauper if he fails to recognize and relate to the changing needs of his people. Mr. Drexler underestimated the impact of technology within the retail world. Previously, Mr. Drexler argued that when people come into a store and feel the fabric, they will notice the difference in quality, and will recognize the value of the brand. And that belief may hold, provided consumers are still going into the stores. But today, that is simply no longer how people shop. Preferring convenience and options, consumers have turned to online shopping where they can find quality at discount prices, without actually touching the fabric until after the purchase. Since J. Crew was relying on in-store shoppers, and not online appeal, they have lost their competitive advantage to brands that have invested more in the digital experience. In Mr. Drexler’s own words, “You cannot be successful without being obsessed with the product, obsessed with social media, and obsessed with digital. Retail is now all about that.” Because J. Crew failed to recognize the shift to digital experience, they are now behind the curve, and the result is lost market share and a famed CEO stepping down. Now consider Domino’s Pizza - a pizza chain that in the early 2000s was known for cheap ingredients and bland tasting pizza. With a stock price at $8.76 in 2010, Domino’s turned to new CEO, Patrick Doyle, to turn things around. Mr. Doyle made two notable accomplishments of equal importance:
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