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The Wall Street Journal this morning has a story about how clothing retailer J Crew, having just parted ways with its new CEO, James Brett, has decided to “discontinue its budget clothing line called Mercantile and shut down the newly launched Nevereven brand,” and place a renewed focus on its core brand and its outlet stores.

The move is likely to disrupt J. Crew’s deal with Amazon; the company had long resisted doing business with Amazon, but had relented recently and decided to sell the Mercantile budget line there.

“J.Crew plans to focus on growth for its overall lower-priced outlet business, including in stores and on its website,” the story says. “The phaseout of Mercantile next spring and summer is meant to free up staff to work solely on the outlet business, which has 175 stores, currently including 42 Mercantile stores.”
KC's View:
I find this to be interesting from a branding perspective. The company created two new entry-level brands that were designed to attract people to the J. Crew ethos at a lower price point, presumably so that as they get a little older and more prosperous, they’ll move to the higher priced/better quality brand. But then they decide to eliminate the two spinoff brands because they’re worried that they will cheapen its brand equity, but does decide to put a greater focus on its outlet business. Which is intriguing, since to my way of thinking, all outlet stores do is cheapen a brand … they sell the mistakes and leftovers and attract cherry-pickers, not cherry buyers.

Focusing on outlets strikes me as being a short-term cash generator, not a long-term brand play.

I’m not saying they’re wrong. I’m just saying I don’t entirely understand what appears to be conflicting tactics … and I’m wondering how many other retail brands send mixed messages in the same sort of way.