Marvin Traub, Beach Bums, Sex, Norman Sas and Obama

Hail and Farewell to the Prince: I met the indefatigable Marvin Traub several times, while he was head of Bloomingdale’s and during the last 20 years when he was thought to be too old to run the trendsetting Upper East Side emporium and started his own international consulting company. He was a paragon of the “retailing is theater” school, perhaps its greatest practitioner, a merchant prince who captivated a generation of shoppers and thereby transformed a sleepy, discount-oriented department store propped between Lexington and Third Avenues in Manhattan into an essential stop by every New York visitor including royalty, show biz luminaries, and everyday gawkers from around the United States and the world.

Traub died Wednesday. He was 87. The obituary in The NY Times (http://www.nytimes.com/2012/07/12/business/marvin-s-traub-who-made-bloomingdales-a-home-of-style-dies-at-87.html?_r=1&pagewanted=all) did not come close to revealing the magnetic personality and command Traub had on retailing and pop culture, especially on New York City. When the city teetered on the brink of bankruptcy in the mid 1970s, when the city dangled perilously close to lawlessness in the 1980s, Bloomingdale’s shone as a beacon of cache and refinement. There were many New Yorkers, including one of my staff writers, who made Bloomie’s a daily must-visit. 

There are comparatively few retail geniuses at work today, men and women with ideas and visions that transformed the buying and selling of goods. Eugene Ferkauf, who founded E.J. Korvettes and modern discounting, died a few weeks ago. Traub was among that pantheon of leaders. 

Passing The Times: Our daughter Ellie and her husband-to-be Donny are trendsetters. At least as far as knowing which beach to sun and surf at. They discovered Fort Tilden beach in Queens a good four years before The Times named it “one of New York’s great hidden beaches” a few weeks ago. Kinda disappointing The Times didn’t include them in any of the 14 photos that accompanied the article, though I might have been a little taken aback if Ellie showed up as one of those beachgoers who “go topless.”

You never know where or when your past will intrude on your present. Reading through the Letters to the Editor of last Saturday’s Times I came upon a short note from Ira Sohn reacting to an opinion piece from Bill Keller advocating a national ID card. I’ll pass on the desirability of such a card. I was more interested in Ira Sohn. If he’s the Ira Sohn I think he is, we attended high school together in Brooklyn, Yeshivah of Flatbush, graduating in 1966. Our senior class secretary, Ira Sohn is a professor in the economics and finance department of Montclair State University. 

Sleepy Head: Whenever I would yawn in front of my mother she’d call me “sleepy head” and suggest, “You’d be less tired if you didn’t fool around at night, but then you wouldn’t have as much fun.” 

She must have been onto something, if a survey published in the NY Daily News is a true indicator of national behavior. Seems an online study of 1,000 people commissioned by Trojans, the condom maker, has found New Yorkers have five times as much sex as the average in 10 major cities across the nation (http://www.nydailynews.com/whoopee-city-tops-sex-survey-article-1.1113403). 

For what it’s worth, while I could believe there’s more action in the Big Apple, I don’t believe the rest of the country lags so far behind. 

Speaking of Action and having fun, one of the best games of my 1950s-early 1960s childhood was electric football, a precursor to today’s video game versions of mayhem on the gridiron. The inventor of electric football, Norman Sas, died last month. He, too, was 87. Younger readers might not know about electric football, but those of us of a certain age remember it fondly and with some degree of exasperation when your felt-bottomed players failed to go in the direction you wanted them to. Here’s the obit on Norman Sas: http://www.nytimes.com/2012/07/13/business/norman-sas-inventor-of-electric-football-dies-at-87.html

Communicator-in-Chief: Teasers for a Charlie Rose interview of Barack and Michelle Obama airing Sunday night on 60 Minutes have the president saying, "The mistake of my first term—couple of years—was thinking that this job was just about getting the policy right. And that's important. But the nature of this office is also to tell a story to the American people that gives them a sense of unity and purpose and optimism, especially during tough times."

Wrong. We did not need another Reagan in the White House. We needed another LBJ, someone who could whip recalcitrant Democrats into line and even pull some Republicans into the fold to pass legislation this country needed. Instead, we got a hands-off chief executive who naively believed Republicans were joking when they said their main task during his presidency would be to make sure it lasted just four years. He naively believed they would put country first, would work with him. So he wound up squandering Democratic majorities in the House and Senate during his first two years in office. 

He’s too laid back for the fight he is in. He needs to be more Harry S. Truman, less Jimmy Carter. He needs to show he wants to be our leader. Tell us stories if you want to Mr. President, but don’t forget to tell us what you will do in the next four years and ram home what benefits and programs Mitt Romney would remove if he gets to sit behind that desk in the Oval Office. 

  

If I Were In Charge

If I were in charge....

...I’d order corporate travel programs to boycott all airlines that didn’t pass along to the buyer the funds from the recently expired federal tax on airplane tickets. Except for Alaska and Spirit, to my knowledge, all airlines have chosen to raise fares by an amount equal to the expired tax, reasoning the consumer already is used to paying the higher amount so why not pocket the tax portion no longer being collected for the government. The tax averaged about $20 for a $200 ticket. It’s all very legal, but not really ethical.

I’d maintain the boycott until the airlines dropped the greedy pricing practice. The only way to force airlines to behave is to hit them where it hurts. If it’s too much trouble to boycott all the airlines, then single one out. Within days it will lower prices, no doubt followed by the rest of the fly-boys.

...I’d require all states to pass laws requiring Internet retailers with nexus (offices, warehouses, or other tangible assets) within their borders to collect sales taxes. When the Internet began, it was appropriate to give Web retailers a break. But Internet retailing is quite vibrant these days; the price advantage most cyberspace merchants receive is unfair to brick and mortar companies.

Moreover, those sales tax dollars are desperately needed by state and local governments. They’d also help offset the loss of revenue (from sales and property taxes) when retailers, such as Borders Group, go out of business.

I would exclude Internet start-ups from tax collection liability either for their first five years of operation or until their sales exceed $50 million a year.

...I would require all newscasts and newspapers to show past positions (by date) of politicians featured in stories as a way of exposing hypocrisy or at least changed thinking. It’s truly ludicrous that for the most part only Jon Stewart on The Daily Show goes back to the archives to reveal outright reversals of previously hallowed statements. People (and by that I mean, reporters and editors), let’s get some accountability here, not just for politicians but also for your actions.

...I would disallow government pensions or other retirement benefits for any politician or public servant who resigns because of a sex or ethics scandal (or a felony conviction of any kind), regardless of how many “clean” years he or she served.

...I’d require all politicians to pass an economics class that includes some simple lessons. First, while businesses often resort to cost-cutting measures for short-term profit enhancement, long-term growth can occur only if revenues are raised.

Second, businesses will seek any way they can to increase profits and reduce taxes, even if it means not acting in the national interest, e.g., sending jobs overseas rather than employing more Americans.

Third, cost-cutting can be effective if it does not harm the product, such as by substituting inferior raw materials, or by delivering less value to the consumer.

Fourth, government is analogous to business in that budgets may be balanced by cutting programs, but the value passed onto the public may suffer in the form of fewer police and firemen, lower social security payments, fewer parks, more children per classroom, etc.

Fifth, given the aging of the baby boomer generation and their increased use of Medicare and social security, more revenue generation is required, generally in the form of more tax collections.

Sixth, businesses and individuals often live beyond their current means. They borrow against the future. Individuals do that when they buy a home through a mortgage or make credit card purchases; businesses do that by issuing bonds. There’s nothing sinister or bad in those practices. For anyone in our government to believe it is now a smart move to stifle the future is a repudiation of capitalism as practiced today in the United States.

Judge Not

Twelve years ago tomorrow, according to the Jewish calendar, Nathan Ancell passed away.

He was 91, a frail man. I didn’t really know him. He was a member of my synagogue, a regular attendee of Sabbath services. He sat in the back. Back then I was the head gabbai of our congregation (a gabbai, for those not familiar with the Hebrew term, is a glorified head usher, assisting the clergy by handing out honors and maintaining proper decorum during the service).

As I walked around the sanctuary, I’d notice him sitting by himself, barely able to stand when necessary, suspenders keeping his pants high up on his torso in the manner of many an elderly man.

The day after Nathan Ancell died on May 31, 1999, his obituary made the front page of the NY Times!

Needless to say, I was flabbergasted. And professionally embarrassed, for you see, though I was a supposed maven of retailing, I was unaware Nathan Ancell was a co-founder of Ethan Allen, a visionary responsible for pioneering the concept of selling furniture in room settings. Far from being a down-and-out old timer, Nathan Ancell was rich, very rich.

Only after I confided my blunder to Gilda did she inform me that she had been to his home and it was spectacular.

That old saying is true...you can’t judge a book by its cover.


Penney for Their Thoughts: The last time JC Penney made a bold corner office move, as it did earlier this week naming Apple’s Ron Johnson their incoming chief executive as of Nov. 1, I was very much a part of it.

Penney’s problems today resemble those it had in the late 20th century. It was a muddled, middle of the road department store, with little to entice shoppers to walk its aisles, unless they were headed to a bathroom or to their car. Penney’s senior management were nice guys, but not really up to the task of making the retailer a meaningful shopping destination.

In April 1998 I wrote in my magazine, “Something radical must be done. Penney needs to break the mold of inbred succession it has clung to since James Cash Penney retired if it wants to make serious headway with its department store strategy.

“I nominate Allen Questrom.”

Questrom was the former ceo of Federated Department Stores. He had merged it with R.H. Macy. He was a merchandising wizard with strong people skills.

Penney’s board of directors discussed my suggestion at its next meeting, but nothing happened, until July 2000, when Penney named Questrom its next chairman and ceo. Everyone in the press clamored for an interview; when Questrom was shown a copy of my April 1998 editorial, he granted me the first one.

Questrom left Penney in 2004, replaced by Myron “Mike” Ullman. Ullman had been chairman and ceo of Macy and other high-end retailers, but his expertise was in finance. Penney initiated some strong cross-merchandising agreements with companies like Sephora under Ullman, but has not been able to have any sustained breakout ideas. It also suffered as its core middle and working class clientele pulled back spending during the recession.

There’s no doubt Johnson is the fair-haired executive in retailing. Apple stores scoop up an estimated $4,000 in sales per square foot. Penney, by comparison, does under $160.

It would be presumptuous to believe Johnson could jump-start Penney’s performance based on his Apple experience. For one, the product lines are too dissimilar. Apple has a limited number of stock keeping units (SKUs) vs. the wide assortments at Penney. Apple’s SKUs are rather pricey compared to underwear, socks, or a men’s suit or dress. Apple stores are an electronics playground, visited by dedicated, some might say, brainwashed, customers and would-be acolytes, with lots of committed, helpful staff in a small store format. Penney’s stores are huge. Staff is there mostly to replenish stock and straighten up, not sell, for there are few customers who need help picking out a set of towels or a prom dress.

Despite being sold at full price, the uniqueness of Apple products—the iPad, iPod, iPhone, iTouch, MacBook—draws shoppers into Apple stores. While other retailers in a mall are almost empty, even in midweek Apple stores are abuzz with activity. Penney might have unique merchandise as well, but its private label apparel and home goods must compete with name and designer brands often sold at a discount in countless stores in the mall and strip centers.

Johnson’s challenge will be to sprinkle into the mix enough products that are exclusive to Penney and create excitement around them. It’s not his Apple experience that will serve him well here, but rather his time as head of merchandising for Target. Just as Target has a cult-like following for its Michael Graves housewares and other trendy goods, Penney will have to undergo a transformation in the consumer’s mind.

Can it be done? Can Johnson do it? He’s probably among the few executives who could. But he’ll need help turning on the spending spigot. He’ll need an improved economy with stronger home sales. Until middle America starts spending again, Penney will just be treading water.

Rejected

Rejection is a common, if not welcome, part of many a life. Last night’s CBS Evening News with Katie Couric featured a story on a new book, “Other People’s Rejection Letters,” that will amuse, or pain, you, depending on how thick your skin is. Here’s a link to the story: http://www.cbsnews.com/stories/2010/07/20/eveningnews/main6696691.shtml.

After four years as a reporter with The New Haven Register, I was eager to move on. I looked up the name of the managing editor of The Wall Street Journal in the directory edition of Editor & Publisher and sent him a letter and resume. I did not receive a rejection letter. I heard nothing back. No matter. Shortly thereafter I began my 32-year career with Lebhar-Friedman, almost all of it with Chain Store Age.

I did, however, find out what happened to my overture to The Journal, courtesy of one of my former colleagues at The Register who did secure a job with the paper, owned by Dow Jones at the time. My letter was reproduced in Dow Jones’ annual yearbook of achievements and noteworthy events. Seems when I copied the name of the managing editor of The Journal my eyes must have shifted over to the adjacent column, onto a listing for The Daily Worker, the Communist Party newspaper. The Journal staff found it very amusing to have a communist as head of the nation’s pre-eminent capitalist business newspaper.

Have you stopped laughing yet?

All I can say, to save some face, is that I got a lot of satisfaction in subsequent years when The Journal quoted me in stories about retailing.