Mickey Drexler Muses on Building a Small Brand, Gap Inc. and Retail Challenges
Lisa Lockwood
12 min read
“Small is the new big, in my opinion.”
Those are the words of Mickey Drexler, the former chief executive officer of The Gap Inc. and CEO and chairman of J. Crew, who’s bringing his big brand experience to Alex Mill, the small sportswear firm founded by his son, Alex Drexler, in 2012.
Starting as an adviser and later an investor, Mickey Drexler was named CEO of the brand in 2021. Two years before, he helped orchestrate hiring Somsack Sikhounmuong, who previously spent 16 years at J. Crew, as Alex Mill’s cofounder and creative director. Together the three partners are charting a new course for the privately-held brand. They have been working to hone the product, relaunch the company as a women’s and men’s sportswear label (it started as men’s exclusively), open stores (Mercer Street and Madison Avenue) and expand into new categories, such as accessories and dresses.
Today the women’s business online accounts for 68 percent of sales, while men’s generates 32 percent. The overall business is 75 percent direct-to-consumer, with several key wholesale accounts.
WWD chatted with the 77-year-old Mickey Drexler via Zoom about what he’s learned from his experience running mega-companies, how he’s helping to build Alex Mill, his thoughts on Sonia Syngal’s departure at Gap Inc. and what it’s like working with his son.
WWD: Having visited the Mercer Street store, let’s talk about product. Why do you feel these are the right clothes?
Mickey Drexler: It’s probably a difficult question to answer. What we do is always have the right clothes for this time. It’s all merchandise that we feel, for lack of a better term, doesn’t expire. Good taste is hard to define. That’s what we do — good taste, good style, high quality and fair pricing. It’s kind of a vision we have, and it’s a standard that we live by and it’s an intuitive judgment that we make. Style and good taste is not a concrete issue, it’s based on the point of view of the merchants who have vision. I think a CEO is also responsible for that and the designers. We only have three. We’re a small company that enables us to work very closely together. I sit at a table with two merchandisers. I never had such a close partnership. I’m not sure they love me sitting four feet away. I look at everything, as does Alex and Somsack. Next week is our women’s spring collection. We spent three days looking at every style in every color. And it has to pass the minimum test, which is style, taste, quality and the commercial aspect is, how will it sell? We’re essentially investing in clothes that we hope we get a return on investment on. I’ve done it a long time and Somsack has worked with me for 15 years at least, and Alex and I have been together for over 40 years, but we’ve worked together for the last three years.
WWD: How is working together with your son?
M.D.: There is a breaking-in period always with a father and son working together. We went through the breaking-in period. Alex was the founder and the company started in a tiny office on Canal Street. He had a vision of what it could and should be. Because of him I am now gainfully employed. His vision is the reason that the company is so successful. In terms of working with him or any son, there’s a breaking-in period, and at that point it’s not so easy. I’m a father first and work with him second. I’m really a very active adviser to the company. I love what I do and will continue to do what I do. My mission is to have a profitable and growing company for all the associates there and future associates.
WWD: Who’s calling the shots in this company?
M.D.: The buck stops with me. One never does it alone. What we’re doing now [versus the Gap] is on a much smaller scale. It’s self-funded, so we don’t have the big investors, or investors who invest and have a piece of the company. It also doesn’t have investors who might not have experience in the garment/fashion business who always have opinions. I’ve lived my life with boards of directors. The fashion business is unique in that regard. I think it requires instinct, a point of view and a great team…In my opinion, there’s a tendency to have technology and operating people. We need them, too, in our small company. I compared it to a good restaurant. Without a good chef you’re not going to have good product. Without a good merchant and designer, you’re not going to have a good product. Not that they have to be number one, the CEO, [but] they have to be among the top influencers in a company.
WWD: What do you think was Sonia Syngal’s problem at the Gap and why do you think she stepped down as CEO?
M.D.: I’m friendly with Bobby Martin, executive chairman at The Gap, who’s a very talented, competent leader. I don’t know Sonia. Sonia is very smart from what I understand. There is a factor in the merchandising and design. I don’t know what her problems were. We’re all judged by results, myself included over the past. CEOs pay the price, and the buck stops there. Bad business, I’ve been there at Gap. We had a rough year and the founder decided he wanted to make a change. The irony is they made the change, they didn’t make it initially. We had a close relationship. We worked together 18 years and then he told me perhaps he didn’t make the right decision. We paid a price when you have a rough year or two. You hit a wall. There’s no one in the fashion business who does not hit a wall. Sonia was in her job a relatively short time, and I guess the board decided that they didn’t have confidence. I don’t know the inside story, but she’s a very smart, talented person, but maybe this wasn’t her forte.
WWD: Back to Alex Mill. Let’s talk about retail for Alex Mill. How many stores do you think Alex Mill could support?
M.D.: It’s a very hard time to make that decision. Rents are fluctuating. Businesses are facing tremendous headwinds right now. Someone asked me when I think it’s going to be over; I said I have no idea…No one forecast this, except a few. Right now we’re sitting and waiting. We have two stores. All of us, me included, opened too many stores in America and we all became big companies. By the way, I think most big companies are very bureaucratic. I was guilty also, I assume. You have to be nimble, you have to be quick today. You have to jump on trends, and you have to see around corners, if you’re in the apparel, non-commodity business. I couldn’t guess but maybe no more than 30. We have a long ways to go. We self-fund the company and we want to make sure we make a return on our investments. We’re still going to school on the two stores we have. One of our biggest challenges is we’re not that well known. It takes time. I remember [how long it took] Madewell to get on the map. In those days, it was a great small company. It took time. I think it was five or six years. I don’t have the patience for that. Old Navy took off like a rocket initially, and I founded those two companies and it was very exciting to see.
WWD: How do you feel about running a small company, versus your experience at the Gap and J. Crew? Are there a lot of advantages being able to build something from the ground up?
M.D.: The big companies were small when I got there. Small is a lot more fun. The growth periods on any of these companies I’ve been involved with, Old Navy, Gap and J. Crew, it’s really exciting to build. Any entrepreneur/creative will say that. When they get quite large and they’re public, there’s a lot of pressure from a lot of people, especially those who only look at the stock price. I like small now because it’s fun. I am a micro-manager, I love to be involved in anything a customer sees. We have 30 people in one office; our intent is to grow big or bigger. I think the early years in turnaround or new company are always really very challenging. The challenge is not merchandise, I don’t want to sound arrogant around that, but people really love our goods. But not enough people know about us. We had a great couple of years running from tiny, tiny, to getting respectable. I can’t say what’s going to happen this year. I don’t think anyone in retail is optimistic or frankly in a lot of businesses.
WWD: You talk about building brand recognition. Do you want to do more wholesale business?
M.D.: No, we love our wholesale partners. We have enough right now.
WWD: What other categories are you interested in adding to the Alex Mill brand?
M.D.: We need more accessories. We’re very weak and we’re working on that. We’re going to do dresses. I think we had a big miss on dresses. That miss, I personally never understood the dress business. I made a mistake. Dresses are a standard part of the uniform. I think the most successful retailers, less is more, dominate the categories you’re selling. Over-assortment is the enemy. I, as much as anyone, am guilty of too much offering to the consumer. I don’t think it’s just in apparel. It’s very confusing to go out there and shop these days.
WWD: How will you raise the profile of this brand? How will the consumer get to know you?
M.D.: It’s a really good and difficult question for us. It’s going to be word of mouth, viral, social media. I come to work every day saying what can be better. No one escapes my list of what can be better. I think the product is very well received. People like our marketing and communication, but we have to broaden that and increase our customer lists. We’re working on that…I think we’re doing really well in the two years since we relaunched. I’m never really satisfied with what we do. I like to build. I know it comes in time, but I’m kind of impatient. I also think there’s an appeal for us to be small to the customers. It’s kind of a double-edged sword. Small is the new big, in my opinion. Customers like to know about the owners and management of companies. We haven’t told our story. We do a lot of fabrics that are unique. We do botanical dyeing. We do garment dye…We don’t explain enough. We’re dominating certain categories, and I think consistency helps. It took Madewell time to become a household name. I think great brands become household names. Then again, a lot of them get too big and the character of the business changes. I think creativity declines over time. There’s some great companies out there. Those that do it well are the ones that we look at closely. I look at everyone, the competition and the landscape. You still get a lot of good ideas no matter who you look at.
WWD: Do you think you’ve made mistakes in your career that you’re correcting at Alex Mill?
M.D.: I think so. I’ve made so many. As long as the batting average is good. I opened too many stores at J. Crew and Gap, and I had partners in that. International — I never wanted to do that and the board wanted to do it. Some of the mistakes I made were self-inflicted of course, and others were some pressure from my directors, especially international at Gap and J. Crew. Although I think J. Crew we did very few stores [internationally], Gap certainly did. Running a business is hard and once you start to complicate it and you don’t have the bandwidth, I think good management has to say we’re going to focus and you can’t have all these people running all these kinds of businesses. I was part of that. Gap got to be $14, $15 billion when I left. And you can’t be that good in that big of business that requires extraordinary detail to product, intuition and a different culture in different countries. At some point I think as companies grow big, a lot of us don’t handle big as being as good as you were when you were smaller, growing and looking ahead. Once we hit $15 billion at Gap, we started doing stupid things — growth, growth, growth. Public company, stock is down, that always supplied a bit of pressure because everyone’s judging you on the stock price which is valid because that’s the way it works. I like to bet on companies that have founders and partners who invest in it, run it and own it.
WWD: What percentage of the business is direct-to-consumer versus wholesale?
M.D.: I’m guessing, but it’s three-quarters at least. But our wholesale partners are critically important — Nordstrom, Net-a-porter, Stag…part of our job at wholesale is being sellers. I’m not a great seller. We have one person who handles that. We’re small, we’re nimble, we have to be quick.
