09 Mar 2008 1121H

Lifetime value propositions

There’s been a lot of hubbub lately about designers jumping ship from one retailer to another, and the fickle tastes of the consumer, say, in softlines, impacting profitability because of the long lead times from the drafting tables in New York City to the factories in Mexico, Southeast Asia, Central America, and then back to the ports of Los Angeles and elsewhere for distribution to stores. It’s my contention that this is unsustainable as the price of petroleum heads up and up and as retailers, faced with increasing pressures for profitability against ever rising costs, must react much more quickly to fashion and production demands.

I think what I’m talking about is making investments in design and efficiencies in production to be much more lean, possibly meaning moving some elements of production back to these shores or even closer to distribution centers. Why design? In an era of constant change, the only certainty comes from leading that change. By the time one follows a trend it is likely already too late. Target, Ikea, and Apple lead by design: it behooves them to lead the consumer by creating demand and passion around their goods rather than wishing wistfully about it. Once upon a time, Sears led its competition by creating and sustaining brands that people wanted to own; now, mysteriously, not so — instead, it acquires its brands, which has its own problems, not the least of which are cultural. Yet one can’t help but wonder if it were to create its own brands again and nurture them as best of class products in the way that Target, Ikea and Apple have done more or less quite successfully, really, over their lifetimes, if the vitality of the company could not be brought back.

Sears is hardly synonymous with inspiration, but it would not be as expensive as people might think to become so compared to the costs already spent on other efforts. There was an article published not long ago about what would happen if Sears were to offer lifetime ownership, in an era when everything is disposable. The effects could be transformative.

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