Retail: To Niche or Not to Niche

A number of years ago -- in the 1990s? -- I walked into an Eddie Bauer store shopping for a windbreaker jacket. And discovered that they no longer sold winter jackets; their entire product line was now sportswear.

I staggered out in shock (slight exaggeration), long-term memories of Eddie supplying Mount Everest climbers and all sorts of other out-doorsey folks their garment needs rattling around my skull.

Rather than hitting its sales mark, Eddie Bauer eventually hit the wall. A couple of ownership changes later, the company is now returning to its outdoor togs roots with a vengeance, stressing Jim Whittaker's Bauer-clad Everest exploits to the point of adding a Whittaker product line.

Let me add that, after ignoring Eddie Bauer for several years, I'm shopping there again. Whether enough others are doing the same remains to be seen. But at least the company is distancing itself from the run-of-the-mill sportswear crowd.

I have no direct experience in retail rag-trade marketing. I rubbed elbows with marketing staffs as a data supplier, but that was about it. My perspective is that of a casual customer, so take what follows with that caveat.

In retrospect, the Eddie Bauer strategy of forsaking its outdoors roots in pursuit of a supposedly larger market segment was a mistake. Casual observer me has trouble sorting out distinctions between store chains selling sportswear. To some degree I can identify companies that strongly focus on the youth segment (Hollister, Abercrombie & Fitch, etc), but otherwise I have no strong images regarding product-line "personalities."

This is not to say that each retailer doesn't make at least some effort to be distinctive and that hard-core sportswear shoppers indeed understand and appreciate such differences. But not all shoppers are hard-core, and failure to attract enough of these can damage a balance-sheet.

Eddie Bauer's new risk is that it's facing a set of competitors that have had years to recruit loyal customers that Eddie had lost and now must peel away. Recreation-wear is a smaller niche than sportswear, and competition is equally fierce. This is why Eddie Bauer is going to great lengths to stress Mt. Everest, World War 2 aviation gear, sports fishing togs and other strong outdoors-related themes. The company may yet "auger in" as test pilots put it, but it's taking a tack that makes more sense to me than its previous efforts.

Conclusion? The thought of working in any aspect of the rag trade scares the hell out of me.