5 Ways A Struggling J.Crew Made Room For Madewell To Succeed

Madewell recently announced plans to go public, separating from parent company J.Crew. This follows a similar scenario from earlier this year when Old Navy separated from Gap. So how has Madewell found success while J.Crew has failed to evolve?

J.Crew topped the early aughts
J.Crew peaked in the early 2000s under Creative Director Jenna Lyons when it was positioned as an accessible luxury brand with playful patterns, cardigan sweaters and shift dresses, and was made even more popular by Michelle Obama.

Retail Dive has a great comprehensive timeline of the brand’s rise and fall, but the significant low points occurred in the past few years – Lyons left the company, consumers complained that the clothing had declined in quality, and sales plummeted. Enter J.Crew’s cooler little sister, Madewell.

Madewell’s turn to shine
J.Crew launched Madewell in 2006, but the brand has become increasingly popular in the past few years. And where J.Crew has had some misses, Madewell has become a hit – particularly with Millennials – in these five areas:

1. Understanding consumers’ shopping habits and preferences
Crew’s former CEO admitted he underestimated the influence of technology on retail – an area not overlooked by Madewell. The brand has kept its focus primarily online with fewer physical stores than its parent company (Nordstrom also carries the Madewell brand online and in stores through an exclusive arrangement).

While J. Crew plays catch-up and aims to prove they too have the digital marketing chops, their initial reluctance to make the shift to digital, after years of pinning their success on legacy brick and mortar stores (relying on shoppers’ desire to feel the difference in quality), meant that their efforts were in some ways too little, too late.

2. Incorporating the local community
Madewell’s Hometown Heroes collective invites local artisans, jewelry makers and designers into their stores and online to sell their products alongside Madewell merchandise – which is well-received by consumers who like to feel that they’re shopping local and supporting small businesses.

The brand also hosts pop-ups with local influencers to lead styling sessions in-store – allowing their followers to interact with them in person (in addition to their at-home styling sessions shared via Instagram), get tips on how to style Madewell clothes, and even how to build a capsule wardrobe based on the brand’s basics.

3. Providing quality products at a lower price point
While J.Crew was perceived to be producing lower-quality apparel in recent years, Madewell is known for their high-quality denim and leather goods ­– and at a lower price point than their parent company. With large department store brands across the country closing their stores, the rise of discount retail stores like H&M and TJMaxx stand out among the sea of stories of retail demise.

Madewell’s more affordable price point resonates with consumers – while at the same time rejecting the fast fashion business model of the discount stores mentioned above. They positioned themselves in the sweet spot of a lower price point and a focus on responsible materials/sustainability – thus making it possible to compete with more premium brands without the premium price tag.

4. Committing to sustainability and ethical production
Madewell’s commitment to sustainability, Do Well, encompasses the materials used in production (a major value for Millennials) as well as various partnerships and initiatives. This includes a partnership with Cotton’s Blue Jeans Go Green™ program – shoppers can bring in a pair of jeans (any brand) to a Madewell store, which will be recycled into housing insulation for communities in need, and they’ll receive $20 toward a new pair of Madewell jeans.

5. Designing a casual-cool aesthetic
As denim has become more acceptable workwear, and consumers have shifted to more casual, everyday apparel (look at the growth of athleisure, for example), J.Crew’s preppy products became seen as impractical. Consumers started looking to brands like Madewell for its denim, basic t-shirts and minimalistic jewelry.

Madewell’s flagship denim helped build a loyal customer base, but it’s what they’ve built around the product that has resonated the most with consumers. The brand has skillfully navigated the overcrowded retail apparel space, gotten out of the shadow of its parent company – and learned from its missteps – by understanding the behavior and preferences of today’s consumer, and delivering on its brand promise.