Men's Wearhouse (MW) is getting a makeover. Before 2011 is out, nearly one-third of the Houston-based chain's fleet of 590 shops will be refreshed. Founder/chairman George "I Guarantee It" Zimmer and company are executing this plan on the heels of tailoring a retail strategy to keep customers spending.
The men's clothier recently dumped its signature ad campaign (featuring MW's grey-bearded chairman asserting "you're going to like the way you look") in favor of "time-sensitive price promotions" to continue increasing market share. As such, Labor Day's buy-one-get-one-free ads resulted in "the single largest volume day in the history of the company," according to Men's Wearhouse president (and soon-to-be successor to Zimmer) Doug Ewert.
Total company net sales increased 18.6 percent for the fourth quarter and comps were up 4.3 percent. A far cry from March 2010 when the retailer was set to close as many as 145 stores.
To make sure devotees and new converts keep coming back, Men's Wearhouse began an initiative to spiff up stores. Last year, 35 shops were fitted with fresh paint, better lighting, and wood fixtures to showcase dress shirts. Sportswear moved to the front of the store with a "focal wall" for more casual togs. Suits take their place opposite weekend wear and lead the browser to the back of the store, home to Men's Wearhouse tuxedo goldmine. (The concept launched in 1999 and comps for tux rentals continue to trend up, now at 11.1 percent.)
Structured to appeal to the notoriously reluctant shopper (that's you, gentlemen), this arrangement encourages browsing, even though most of the Men's Wearhouse outposts are staffed by a battery of knowledgeable salespeople available to assist the selection process. The chain also has tailors on site.
This isn't going to be cheap. Men's Wearhouse is slated to spend close to $100 million on the remodels in addition to opening between 20 â€" 30 new stores. Management will also sink some dough in IT to improve its online and e-commerce operations.
However, these investments shouldn't hurt too much. The company was smart to wait until it got rid of its long term debt. And while available cash is slightly down, the fourth quarter balance sheet shows there's still a good sized cushion.
Even with these improvements, Men's Wearhouse isn't going to win any awards for being a purveyor of cutting edge style -- and that's OK. The company knows its customer: regular guys who need reasonably-priced, not-terribly-trendy suits and sportswear. That represents a large swath of the dudes in America. And Mr. Zimmer knows that once they're in his newly-fluffed, still-understated shops, they're going to "like the way it looks" so much, they'll be dropping cash in no time.
Image via Men's Wearhouse ad