Two years after he was brought in to lead Jaeger’s turnaround, Colin Henry reflects on the challenges he has faced so far and those still ahead
Jaeger’s vast flagship is one of the longest-standing stores on Regent Street, having opened in 1935. The 27,500 sq ft space is a Mecca for the retailer’s fans, packed to the brim with cashmere, suits and coats. Until recently, however, it was often a sea of red tags as well, reflecting Jaeger’s 12-week summer and Christmas Sales.
But all this is set to change. As part of chief executive Colin Henry’s five-year turnaround strategy for the premium men’s and women’s wear business, Jaeger has slashed its discounting period from 12 weeks to four from this summer and is seeking a smaller unit for the flagship on or near Regent Street.
It is two years since Henry was brought in by Jaeger’s private equity owner Better Capital. He is now reviewing his five-year strategy to make sure it is achieving the aim of rebuilding Jaeger’s reputation as a high-quality premium brand while bringing it into the digital age.
The plan hit a bump in the road last autumn due to the warm weather – Jaeger is, after all, known for its coats and knitwear – but Henry is confident that autumn 15 will see it turn the corner into profitability after it slumped into the red in 2013. “We’re close. We would have been closer if not for last autumn, which is really frustrating. I’m not going to set a time; all I will say is that our full-price sell-through this spring is significantly better.” He would not disclose percentages but said sell-through is up by about a third.
Jaeger ran into trouble in the years following the financial crisis when its attempts to attract younger customers and cut costs by introducing cheaper materials backfired. Better Capital, led by Tory donor Jon Moulton, acquired the business from fashion entrepreneur Harold Tillman for £19.5m when it was in serious financial difficulties in 2012. It has since increased its investment to £56m. In the year to March 1, 2014, Jaeger’s like-for-like sales rose 10% and losses after tax narrowed to £9.9m from £12.6m the year before.
Tillman has been publicly vocal about his dissatisfaction with Jaeger’s direction since he relinquished control. But Henry shrugs this off. “I’ve never met Harold” is all he says when the subject arises. Instead, he prefers to talk about how he is rebuilding the business and brand following years of underinvestment. Henry has made a number of changes to the top team over the past year, including poaching Burberry’s vice president of IT customer and payments Cathy McCabe to become Jaeger’s chief information officer in December 2014. This April he added McCabe to his senior executive team at the same time as he appointed former Bank managing director Gwynn Milligan to the new role of group trading director.
He has also been working with former Oscar de la Renta designer Sheila McKain-Waid, who was appointed as womenswear creative director of Jaeger in November 2013, to improve the product. It is hard to pinpoint when the change happened, but over the years Jaeger started introducing more and more man-made fibres and was losing its reputation for quality. Today, more than 80% of product is made from natural fibres, reflecting its roots as a brand named after Dr Gustav Jaeger, a zoologist who promoted the use of natural animal fibres in clothing.
“Someone called it a polyester purge and she had a point,” says Henry. “[Two years ago] if you’d walked into a store with a flame the whole thing would’ve gone up. I think that’s one of the things our customers have loved most about the transformation: there’s a very obvious quality improvement in the garments.” Retail prices for womenswear range from £40 for a jersey top to £600 for a camel coat, while menswear ranges from £65 for a shirt to £1,000 for a made-to-measure suit.
Anne Horton, former managing director of Hoopers department store group and now director of retail for the Beales chain, is a long-time Jaeger customer. She says: “I’m very pleased with what they are doing – not having continuous discounts, going back to having beautiful classic pieces that are an investment. Years ago, I remember buying a classic camel wrap-over coat and grey wool trousers. That sort of thing has come back in.” But not everyone is convinced. A former customer in her late 50s says she would be reluctant to return: “Their design feels a bit boring and old. It lacks a stylish edge.”
Henry admits that improving the product is only half the battle. Now he has to get the message out. “You’ve got this perception that Jaeger is the brand your mother wore. We’re still working on dispelling that. Last autumn, we did the mothers and daughters campaign to get the mothers back because they had been disenfranchised and didn’t want to spend £300 on polyester dresses. The campaigns since then have become gradually more contemporary and slightly younger.” Henry is planning a big marketing push for autumn 15 in print and, more importantly, online, particularly on social media.
The digitalisation of Jaeger has been a key focus for investment. “I think that is the biggest significant change that’s happened since I joined,” explains Henry. “Before there wasn’t a fully functioning website; it could barely take a credit card as payment. We’ve gone now from being less than 10% of our business [online] to being up to 20% and we’re on track to being well over that.”
In parallel to this, Henry is working to improve Jaeger’s store estate. It has 31 stores, 31 outlet stores and 70 concessions and is in the process of extricating itself from some of the more onerous leases, including the Regent Street flagship. “In 1935 the Regent Street store was Jaeger. In modern day retailing I don’t need a 27,500 sq ft store. It’s like a department store; we have to generate so much product to fill it,” says Henry, who is in conversation with property investment vehicle The Crown Estate to find a new location nearby.
The King’s Road store was revamped and reopened in September 2014 and Henry points to this as the future of Jaeger’s store approach: “When you see the environment, which is so intimate and premium, you see you can create something on a smaller scale and still have that experience.” Belfast received the same shopfit in November and it will be rolled out to the new Fenwick of Bond Street concession when it opens in September and to the store in The Mailbox centre in Birmingham, for which an opening date has yet to be confirmed. Henry is also searching for a unit in Bath. “We’re getting Jaeger back into the locations you’d expect to find it.”
A new Epos system will be rolled out this autumn, which will allow data captured online to be used in store and vice versa. Jaeger will also launch a new digital loyalty programme in early 2016. The details are yet to be confirmed, but Henry suggests it will focus on service and experience, not just discounts. “We issue discount vouchers but a lot don’t get used. The Jaeger customer doesn’t think like that. [The loyalty programme] is about retaining and building a relationship with consumers.”
And it doesn’t stop there. After Jaeger becomes profitable, Henry’s attention will turn next year to international expansion. The chain used to have stores in 35 countries, but it began pulling out of these in 2003 and since 2011 has had none outside of the UK. About 15% of online sales are international, so Henry will use that as a guide on where to start.
He admits there is a “sense of urgency” that comes with being under private equity control. One chief executive of a UK womenswear chain said: “I think Colin is doing a fabulous job and it’s much clearer now what Jaeger stands for, but there are two elements at play here. He has to turn the business around but he also has to manage his private equity owner, whose expectations for the business in terms of timescale and turnaround are possibly not aligned with his – so his ability to pull it off may be compromised.”
But Henry isn’t daunted by the task. This is not the first time he has led a turnaround project, nor worked with private investors. He began his career at Marks & Spencer in 1984, working in store management for three years before moving into the head office buying team. He left M&S in 1997 to go to textile and garment manufacturer Coats Viyella, one of the retailer’s biggest suppliers at the time – and then, ironically, owner of Jaeger – where he worked as managing director for three years before joining US brand Ralph Lauren as senior vice president of brand management.
“My job is to make a brand’s heritage relevant again”
In 2004 he joined UK football brand Umbro, then owned by private equity firm Doughty Hanson & Co, as senior vice president of design and marketing. He was part of the team that turned Umbro into a lifestyle brand stocked in the likes of department stores Barneys New York and Harrods in the UK. “We weren’t a UK-centric football brand anymore,” explains Henry. “That’s what put us onto Nike’s radar.” Umbro was sold to Nike in 2007, which retained Henry for two years to oversee the integration.
Henry joined lifestyle retailer Esprit, which was founded in California in 1968 but is now headquartered in Hong Kong and Germany, as chief product officer in 2011. “It had an incredible history. The story of Doug and Susie Tompkins really fascinated me. They were very much eco warriors in their day, fighting to save the planet. But the usual thing had happened; it went public, control was taken away from them and the brand lost its essence and DNA. The challenge was: how do we get that back?”
This theme has followed him since he left M&S, he points out: “Ralph Lauren, Umbro, Esprit and Jaeger are all brands with incredible heritages that have been tarnished and forgotten. My job is to make that heritage relevant again, not in a backward-looking way but with a modern approach.”
In 2013, when he took the job at Jaeger, seeing what it had become was a shock: “In the good old days, Jaeger was renowned for fabulous quality and it was very premium. It was quite shocking to see how it had slumped from that level to being compared to everyone else on the high street. The high street is important but it’s not what our customers expect. It’s not where Jaeger came from and it’s not where we aspire to be today.”
Despite the pressures, he remains optimistic that his strategy is right for Jaeger. His excitement about the autumn 15 collections, which drop on August 9, is palpable. “It’s modern, elegant, relaxed and it oozes quality. With autumn you’ll understand where we’re going.”