Mickey Drexler: The Art of Selling with Retail's Merchant Prince

This episode will transform how you think about style, aspiration, and the art of knowing what people want before they know it themselves. From working in department stores to advising Steve Jobs on Apple’s retail strategy when it didn’t have retail at all, Drexler’s career traces the evolution of American retail itself: from local shops to mall dominance, from catalog to digital, from mass market to personalization. Whether you’re an aspiring entrepreneur, a retail enthusiast, or someone looking to build a brand that stands the test of time, Mickey shares invaluable insights on what separates truly successful brands from the rest. Mickey Drexler is the chairman of Alex Mill. Before that, he was the CEO of J. Crew and sat on the Board of Directors of Apple. He founded Old Navy and Madewell, and served as the CEO of Gap from 1983–2002. Learn why gaining real-world insights—and not just reports or data—is crucial to staying ahead of the competition. Newsletter - The Brain Food newsletter delivers actionable insights and thoughtful ideas every Sunday. It takes 5 minutes to read, and it’s completely free. Learn more and sign up at fs.blog/newsletter Upgrade — If you want to hear my thoughts and reflections at the end of the episode, join our membership: ⁠⁠⁠⁠⁠⁠⁠fs.blog/membership⁠⁠ and get your own private feed. Watch on YouTube: @tkppodcast (02:16) How Mickey Drexler became Mickey Drexler (07:04) Lessons from redefining Gap (12:47) Merchant, defined (15:17) How Drexler evaluates stores (19:20) Lessons from running Gap (21:19) On Old Navy (27:26) On Steve Jobs and Working with Apple (33:00) Re-making J. Crew (37:00) Drexler's superpower (43:40) Current-day retailers who are great (45:10) How Drexler got "Madewell" (47:15) What makes something a classic look? (50:20) On success Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  What I do, I have a photograph in my mind. I go into a shop. It paints a picture or it doesn't. One bad color in a great painting, that changes, throws off the whole painting. It's like the wheels, the ugly wheels on a Mustang. And I mean that every car now has ugly wheels. I can't get over it. You know, you see the wheels. It's like having a bad button on a sweater like this. This is one of our best sellers. And if you put an ugly button on this, that's what you notice. And I say, never give a customer a reason not to buy something.

• 0:57Shane Parrish?

  Welcome to The Knowledge Project. I'm your host, Shane Parrish. In a world where knowledge is power, this podcast is your toolkit for mastering the best of what other people have already figured out. Most people think retail is about selling things. Mickey Drexler proved it's about selling dreams. As the CEO of Gap and Jade Crew, he understood something profound about the American aspiration. People don't just want clothes. They want to become someone through what they wear. A boy from the Bronx who transformed into retail's merchant prince, Drexler could walk into a room with 100 samples and instantly spot the three winners because he saw what

• 1:42Shane Parrish?

  Americans wanted to become before they knew it themselves. From advising Steve Jobs on Apple's retail strategy to building Old Navy from scratch, Drexler's career traces a remarkable journey of seeing opportunities that others missed. In this conversation, he shares the insights and instincts that let him repeatedly predict and shape American taste. Whether you're building a brand, leading a team, or trying to see around corners in your own industry, you'll learn how one of the retail's greatest minds thinks about the psychology of consumer desire, the principles of brand building, and the art of knowing what people want often before they do. It's time to listen and learn.

• 2:31Shane Parrish?

  Let's start at the beginning. You said your father was a model of what you didn't want.

• 2:37Speaker 00

  He didn't fit up my job description of what I thought a good father should be. Yeah, I didn't know what I wanted then. I didn't know, you know, when you're a kid, like you're moving all over the place. You don't know what's right and what's not right. You learn over time.

• 2:59Shane Parrish?

  What was that relationship like?

• 3:01Speaker 00

  He was, it wasn't good. He wasn't a sensitive guy. He had no emotion. He didn't treat my mom well, who died. You know, she was, had cancer the year I was born. And what was it like? It was, I didn't know any better at all. And I thought this is what a father is like. And over the years, I learned that this is not what a good father is like. And he never, he was an angry, bitter guy. He was not successful. And, you know, he always talked, he wanted to be a big shot.

• 3:39Speaker 00

  So in my family, he acted like a big shot with my mom's three sisters and my seven cousins. And by the way, the irony is none of them liked him because he wasn't a warm, fuzzy, nice person. But I didn't know that when I was growing up.

• 3:57Shane Parrish?

  How did that affect you?

• 3:58Speaker 00

  I think my ambition comes from being the opposite of him, I think. I always lived in my fantasies, escaping where I am. And Peggy, my wife, said, you know, maybe that's where your creativity comes from. I don't believe it came from that because I think creativity is part of your DNA. And I don't think it can be taught. So, but you know, it affected me. He never took any pleasure in my success. And I, he just never did.

• 4:36Shane Parrish?

  Was there a moment when you realized he wasn't a big shot?

• 4:38Speaker 00

  Well, I'll tell you, it's an interesting story. I used to work, he worked in a garment coat company. He worked buttons. He had a kind of a low level-ish job, although I didn't want to face that. And he

• 4:56Speaker 00

  They asked me to take the payroll, I was sixteen. He said, "Take the payroll to the bank." What do I do? I duck out the freight entrance on West Thirty-seventh Street and Eighth Avenue, go into the neighboring freight entrance. I looked through all the pay stubs or whatever it is. He was one of the lowest-paid people there relative to his peer group, who he would always put down and whatever. That was a reality for me. So that was a cold reality. So my thoughts of him being whatever disappeared then. And as I grew, he wasn't a good dad.

• 5:41Speaker 00

  So when I lived there, I was going to City College. I was miserable and I was, you know, I used to go to Subway's, Long Island Railroad, and I'd had to escape from the house. So I luckily got into, I didn't know where to apply, State University of Buffalo. Some guy I knew went, he wasn't even a close friend. I got in, so I escaped to Buffalo and for two years. And, but it was, you know, never took any. He was competitive with me in an ironic way. And, you know, I was getting a lot of press when I, you know, I worked twelve years in the department stores. And then I was very lucky, fortunate.

• 6:25Speaker 00

  I was called to run Ann Taylor then in nineteen eighty. I was a young guy. I, you know, I don't know. I said, "Okay," because I didn't know what I would do next. After twelve years in the department stores, I couldn't find the stimulation and the excitement, or whatever you call it, of the organizations. And I don't think they're much different. Political suck up. I didn't know how to articulate this. But I think in most big companies, people are always sucking up to their bosses. Yeah. That's my own experience and these develop over time.

• 7:08Speaker 00

  You know, because the boss reviews you, the boss promotes you. I've learned over the last number of years, the best judge of a boss is the person who works for the boss. Tell me more about that. Well, it's my own thing. I think in corporations and well, look at all the CEOs out there. I don't know all of them, but I think safe, they went to the right schools. I couldn't care less where anyone goes to school. I like to see a college degree, but I also like to see a work history. But if you're a safe choice and you know, it's again, it's an editorial on what I think.

• 7:53Speaker 00

  People would argue if they went to a fancy school here and a fancy school there. And now it starts and I was guilty when my son was five years old going to a nursery school. I didn't have any connections. I thought it was a fancy one. It wasn't a good choice. But I think if you look at people, you know, like everyone, all these earnings reports. This, I know the public relations people write that, they script them. And safe, you have a good education. You don't want to take a risk on picking the wrong boss or senior executives. And I think there's a lot of self-interested people in this world, plenty of them.

• 8:38Speaker 00

  Why do you think we're so risk averse? Well, I can't answer for others. I think, you know, why? I don't, I think you have to be creative to move any business forward, any institution. And that's what I think, and it's really based on my own personal experience. And also in the, in the, in the sector I'm in, fashion and all that. Creative drives the engines.

• 9:09Speaker 00

  And so why are they risk? It's a good question. They, well, salary, they don't want to risk that. They don't want to risk, I mean, they get very wealthy these days, becoming a CEO.

• 9:24Shane Parrish?

  When you transformed the Gap, you renovated all 430 stores at the same time with no focus group, nothing.

• 9:33Speaker 00

  Oh, my God. If you, if you take over something, you got to get rid of the old merchandise because it ties up a lot of cash. And Don, bless his heart, was nervous about the earnings. I get emotional. You know, my stomach speaks for me a lot. But, you know, business got tough for the first year. The stock dropped probably 50%. You know, I never, I, I worked hard and I was scared after a year, I'll never forget. We were talking about, it was a year and a half, we were in Carmel, and we're sitting there,

• 10:12Speaker 00

  we come up with a kind of a bankruptcy plan. That's when I started to get nervous. And I've been there a year and a half. We, Don redid the 400-plus stores. I redid all the merchandise. I threw it all out, and that's where he was concerned. But you got to take, and you got to get the cash out of bad good, just like rotten fish.

• 10:36Shane Parrish?

  Yeah.

• 10:37Speaker 00

  Or whatever. So we redid the stores.

• 10:43Speaker 02

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• 11:11Speaker 03

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• 11:41Shane Parrish?

  What gave you the confidence to do that? I mean, this was like a, what was it, we're basically gonna go extinct. So that's the base case.

• 11:51Speaker 00

  Those two or three years, even when it turned around, was like, uh-oh. But I worked my ass off. I kept, no one taught me how to run Ann Taylor. I just did it without any supervision because the headquarter, it was $25 million business. But I just went in there day one, and you know, corporate, a lot of people, they leave you alone, or they don't leave you alone. But there I was, and the threat was if I don't turn this, I was under pressure. I didn't make money there. They didn't pay me. I didn't negotiate, whatever. But it is what it is.

• 12:32Speaker 00

  So I always depended upon my gut, my instinct, and in hindsight, I did. I knew who was good person, not a good person. I knew who was full of it and down to earth. And in the department, it was 12 years, I kept looking for the right place to go.

• 13:00Shane Parrish?

  You mentioned you could tell the difference between who was a good person, who was a bad person, who knew what they were talking about, who didn't. What are the tells? How would you teach somebody to do that?

• 13:10Speaker 00

  You can't teach anyone. I am a huge proponent.

• 13:16Speaker 00

  And I never could say, like, Jesus, they're the president, they're the CEO, they're the this. And I'm thinking, I'm not impressed privately. And I can name drop some of the big shots of the time in the retail business. And I would say something like, not a merchant, and they look at me, I could tell. And because I was a merchant, I guess, my first, second day at Bloomingdale's, they put me in charge of a department because the buyer barber was on maternity leave.

• 13:59Speaker 00

  Stan Stern, who I loved dearly, he was a great boss. I was on my own, and I just did it. What does it mean to be a merchant? What it means to me is, and it's not a lot, I think. It means to have know, know from what's going to sell well, from what's not going to maybe sell well. Focus, make sure it's on brand. Now, this is what I do. No rearview mirror. Most people do rearview mirror, and they say, well, we sold last year this. Sometimes it's going to go this way a lot. So you chase what's over in post-peak.

• 14:43Speaker 00

  It means to me to be a merchant is having a sense of what's going to sell, knowing that, like, I always had an instinct, I guess, on what I loved. And I learned later on, if I think it, it is non-negotiable. The word that comes to mind, though, is like taste. Well, that's a good question. What's the difference between? Well, you know, for me, I use that word a lot, but it's in the eyes of the beholder. I have a friend, he's very successful. I was talking about the ugly merchandise in one of the companies he's involved with. He said, well, to the customer, it's not ugly.

• 15:27Speaker 00

  To me, it's ugly. Now, I know what I know. And I don't know where my eye came from. But it came from somewhere. But taste and style and fair value and moving forward and having a vision. Those are the key ingredients that I think. Now, when people say, well, look how good that company is doing. I said, that's not what I like to do. I like to be proud of the merchandise. I like it to be fit my standards. I don't say it that way of what it is, vision.

• 16:06Shane Parrish?

  Right.

• 16:06Speaker 00

  And I liked, I like, I can always tell when something's not on brand. I remember in some of my jobs, I remember looking at something. It was a big tell. And I said, uh-oh. And I didn't follow my instinct. And it really hurt one of the companies, you know, there's people involved. But it means to be a good merchant is, you can't define it, but you know when you know.

• 16:34Shane Parrish?

  You know it when you see it. So if we were to like walk outside and walk in a store and you had five minutes to like, walk me through how you evaluate the merchandising.

• 16:44Speaker 00

  It's all it takes. Five minutes, three minutes.

• 16:46Shane Parrish?

  What would you look at?

• 16:48Speaker 00

  The picture painted. Because when I, I just always, it's a really interesting question because I don't know how to explain what I look at. But I look at, color is very important. When I did Gap, I had a list of styles. I was trying to start something. I was looking for my vision. I always admired Ralph Lauren, but I always thought I couldn't afford his clothes. He was a Bronx guy ahead of me and, you know, I always, he was always had a point of view. And I admired him. I used to buy his clothes wholesale.

• 17:28Speaker 00

  Why? Because a friend of mine's cousin was his secretary. So I got it half off, whatever. But I always liked his taste, and it's still the same today. And there's not a lot of people who do that.

• 17:43Shane Parrish?

  So it's interesting, coming back to your friend's comment about, well, the customers deciding what we sell. If you're selling, if your game, I guess, is to sell the most product at the lowest prices, you're going to be selling the same thing that everybody else was selling. But you're telling me you wanted to create a different vision, one that like escaped the competition in a way.

• 18:03Speaker 00

  What I do, I didn't say this is my plan. I look for white space. This is in hindsight. So Ann Taylor was hugely successful. I left after four years because my bosses were bureaucrats, and I didn't like it there. And I also was at the stage in my life where I have to have something I wanted to do, where I could feel not compensated the right, I was very happy with what I earned. But I faced the realities of living in Manhattan. Anyway, I always had, Ann Taylor was purely instinctive.

• 18:41Speaker 00

  But I did learn there that I didn't want to sell brand A, B, C, D. And today, you can get every brand at a discount. And TJ Maxx, my friend there, Carol, she's the best. You can go to TJ Maxx and trust. But they're the biggest customers of most brands. So I didn't want to carry, because Alexander's taught me the lesson. I was maybe 25 years old, and I said, Jesus, something's wrong here. And, you know, you kind of, I'm self-taught, and then I'm also very curious.

• 19:22Speaker 00

  When I joined Ann Taylor, Brooks Brothers, and I saw it decline dramatically then. Because, you know, no merchants running at the quality. They would take quality out to maintain price. But they had a protective device about competitors. They owned their name. They didn't sell wholesale. No one could take a markdown. So what I did at Ann Taylor is

• 19:53Speaker 00

  We did, I, you know, I found some manufacturers. Today, you get your own, but who can make goods. We designed them with them. And we had Ann Taylor Studio label.

• 20:06Shane Parrish?

  Right.

• 20:06Speaker 00

  Now, no one told me to do that, but, you know, do, do, do.

• 20:10Shane Parrish?

  It's the white space.

• 20:11Speaker 00

  It's, well, yeah, and, and then I don't have to worry about meeting the competition. What's going on in the business today, by the way, is if you look at pricing, first of all, everything's on sale. I always give advice when I'm on a, whatever, I say, before you give them the credit card, Google the item you want to buy. You'll find it somewhere most of the time.

• 20:36Shane Parrish?

  Let's go back to the Gap before we get to the end of the Gap. So you were the CEO from 95 to 2002. How did you prevent the bureaucracy from building up over those seven years?

• 20:48Speaker 00

  You know, well, the bureaucracy is, I'm all over everything. They, they, I took every call from a customer and they'd be surprised about, you know, if, and I say, if I can do it, you have to do it. You know, but today, you know, it doesn't always work. I tell every story, customer stories. I would call customers if they, anyone who called me, I got back to them.

• 21:20Shane Parrish?

  Yeah.

• 21:20Speaker 00

  And, you know, now I do that. It's a little bit of a payback because I never had anyone like that.

• 21:25Shane Parrish?

  What were the key learnings from the Gap? Like, what are the key lessons that you took away?

• 21:30Speaker 00

  Oh, every day, the key learnings, oh, you must have a vision. You must be whatever's defined as a good merchant. You must be spot on and be a pain in the ass because the best bosses. And I always say, hire your boss because that's the one. And I never had bosses who I thought were the best, especially in, yeah, but I became the boss, other than Don was my boss there. And I had to, you know, play that game with him because if you do what I do. And I wish you Steve does and you do what maybe all these other people do. You are always competing. You have to be competing.

• 22:15Shane Parrish?

  It's relentless.

• 22:16Speaker 00

  And it goes with it. And if you're not, a lot of people don't compete. I have, I know friends who run companies. They're bureaucrats. I know because I know them. So Old Navy. You know how I, you know how I started that? It's my favorite, one of my favorite stories. So in the New York Times, I used to read it when it was a decent paper. Business section. I always liked to read about business because I wanted to be who they all were.

• 22:48Shane Parrish?

  Yeah.

• 22:49Speaker 00

  And then I realized, well, I didn't realize for a long time who they were, but not what I wanted to be. So there was a little article, page, buried on page four or five about Target. Now it was then called Dayton Hudson, very bureaucratic company that I, I knew that they did a lot of research and a lot of this and a lot of that. So, and then someone was quoted as saying it's pretty much going to be a cheaper version of Gap.

• 23:22Speaker 00

  Week the store opened, I flew out to Mall of America, that week. I didn't even tell anyone.

• 23:27Shane Parrish?

  Yeah.

• 23:28Speaker 00

  But I said, well, fuck them.

• 23:30Shane Parrish?

  Yeah.

• 23:31Speaker 00

  And I went out, Mall of America, I walked in the store. I was there no more than five minutes and I said, whoosh, to myself, you know, you gotta, you know, only the paranoid survive.

• 23:48Shane Parrish?

  That's interesting, right? Because it's a story of only the paranoid survive and it's also-

• 23:53Speaker 00

  And Andy Grove is the one who wrote that book.

• 23:55Shane Parrish?

  But it's also a story of making sure that you're touching the mediums. When you're talking to customers, there's no filter between you and the feedback. When you're flying to the store, there's no filter, but you're, you're looking at the terrain. Somebody's not telling you what it is.

• 24:08Speaker 00

  In corporations.

• 24:10Speaker 00

  Most of the brass, they're in their ivory tower. I remember in the department stores.

• 24:17Shane Parrish?

  They're so far disconnected.

• 24:19Speaker 00

  Go on the selling floor, speak to someone. Plus, it's decent. You know, people, for me, I identify with those people who aren't the fancy people.

• 24:32Shane Parrish?

  You know, a funny story about this. I bought an Xbox for my kids. It must have been, I don't know, seven years ago for Christmas. And we're opening it, and we're setting it up on Christmas. And I was like, the person who designed this Xbox experience doesn't have kids. It took an hour and a half to play a game. From the time we plugged it in and turned it, it's like, first, you gotta do updates. Second, you gotta sign up for all these accounts.

• 25:00Speaker 00

  Keep it simple. Stupid is the greatest lesson.

• 25:02Shane Parrish?

  Yeah.

• 25:03Speaker 00

  My first week at The Gap, I put up signs, keep it simple. I took out the stupid. Every desk in the corporation, people would talk a language to me. I didn't know the language. I'll never forget this. She, this one woman, she's in charge of whatever, planning and something. I didn't know what she was talking about. And I just said, keep it simple, to the point.

• 25:29Shane Parrish?

  Yeah.

• 25:29Speaker 00

  You have to, you have to bring everything to its simplest common denominator.

• 25:35Shane Parrish?

  And the best way to do that is to actually use your own product.

• 25:39Speaker 00

  Yeah, yeah. We did the P. Jimmy's pajama thing, which is a really fun thing. It's gonna be very good for him and us, long term. And there's a, they call a boxer short. Well, their name for it was a short pajama pant. And, and they show me their new version. Now, it's the third after the pant and the pajama set. The, they're calling it the long, the short pajama pant.

• 26:15Speaker 00

  Number three seller. And they show me this thing that they're changing it. Now, this is typical of what goes on. And I said, it's the third best seller. You want to change it? I said, and it's called a boxer short. It's not called. I get a little impatient a lot. And then I do a little survey. I go around just to. I say, what do you call this? It's a boxer short.

• 26:44Shane Parrish?

  Yeah.

• 26:44Speaker 00

  When you say the word boxer short, you don't have to describe it. It's the, it is what it is.

• 26:50Shane Parrish?

  Everybody has an idea of what it is.

• 26:51Speaker 00

  Of course, everyone knows it's an elastic waist.

• 26:53Shane Parrish?

  Yeah.

• 26:54Speaker 00

  And I said, continue that. And you're not doing this, whatever it was. And that's what I do.

• 27:04Shane Parrish?

  Yeah.

• 27:04Speaker 00

  And it's funny. And they call things, I like to name things that say what it is. And I go through this all the time. They confuse people. I said, there's certain names that you know what it is.

• 27:20Shane Parrish?

  Everybody wants to come up with something new.

• 27:22Speaker 00

  They don't, no, but they're not logical.

• 27:24Shane Parrish?

  Yeah. So what happened at the end of the gap in your tenure there?

• 27:29Speaker 00

  Oh, well, you know.

• 27:30Shane Parrish?

  Steve Jobs, like, just to frame the conversation here. So Steve Jobs is on the board. He calls you.

• 27:36Speaker 00

  Yeah.

• 27:36Shane Parrish?

  So take me through this.

• 27:37Speaker 00

  Well, Steve Jobs joined the board. He was recruiting me to join his board about a year. Steve is very seductive. He doesn't give up, like a lot of people who do what he does. And he called me one day. And he said, I'll join the gap board if you join my board. Deal. Because I knew Steve. You know, there's no such thing as an independent director. You know, there's a litmus test. Not a relative. They don't do business with you. But they ought to have on the test. Not a close friend, not a college roommate, not a cousin, not whatever.

• 28:21Speaker 00

  Unless it's, you know, if it's a controlled company, you can do what you want, but independent directors. So I said, didn't even think, deal. I knew he would be. Steve Jobs. He's irreverent. He challenges things. He might be late, but I love the guy. What was he like as a board member? He was a troublemaker because he brought up things. I'd sit there, thank God. But he alienated people because, you know, it's okay to alienate people. He had, he, but he didn't, he really wasn't a very paid attention board member, but I didn't care.

• 29:04Speaker 00

  So he was on the board only about a year and he, he wasn't very popular, but I just, you know, guy was ill, he was dying. I just so admired him and I really admired him a lot. Johnny Ive was his lunchmate and I had, you know, Johnny and I became good friends. And Steve was whatever. So there's a board meeting. I knew there was something going on. People, all of a sudden, you know, when you have a corporate and they don't, first of all, I never had a director who really understood the goods.

• 29:45Speaker 00

  You know, and, and, you know, if they came in, they didn't like the name Old Navy. I got it off a bar in Paris. I was driving to the airport. I was fortunately in the backseat on the left. I'm looking out, I said to Maggie, she was in marketing, I go to Paris, you know, you go to shop, you get ideas creative. So I see Marquee with a lot of neon lights and it says Old Navy.

• 30:12Speaker 00

  I said Maggie, that's the name. We needed a name for Old Navy. Which by the way is about eleven billion dollar business today.

• 30:20Shane Parrish?

  Yeah, it's huge.

• 30:21Speaker 00

  That's the name. They didn't like the name. Long story short, two naming, I don't like agencies and I don't like consultants. And Old Navy, by the way, that was started, it's a whole other story.

• 30:37Shane Parrish?

  So, so let's go back to the firing. So Jobs is calling you.

• 30:41Speaker 00

  Okay, so this is, we had a bad year. So Jobs was not at that board meeting. I presented at that board meeting, the turnaround assortment.

• 30:52Shane Parrish?

  Right.

• 30:53Speaker 00

  I looked at every, Banana Republic, Gap, and Old Navy. It was a tough year, I think, in the marketplace. They weren't looking at me. I get home about nine. He says, Don just told me you're getting fired. They had to, they had to tell him. He said, they didn't tell me until now because they were worried I would tell you. And of course, I would tell you. So, but nine was the deadline they had for whatever. And I called Don. He brushed me off very quickly. Come in at eight o'clock, da, da, da. It was a board meeting the next day.

• 31:33Speaker 00

  He hands me a one note, whatever. That was my last day.

• 31:39Shane Parrish?

  So, you end up going on the Apple boards. Steve recruited you. He seduced you for over a year to join the Apple board.

• 31:46Speaker 00

  Yeah, and I say that with all fondness for him.

• 31:49Shane Parrish?

  What was the Apple board meetings like and what contributions did you make to retail there?

• 31:56Speaker 00

  Well, you know, I designed the first store with him. Because he designed an ugly store. And I, we went in and I told him, get a warehouse, build a store. So we can design it together. So we did a Gap. You have a store before you open it up. So I went in, it was very simple. I said, it was too tchotchkeed. He said, "Simple. A screen to show the movie or whatever it is." So we designed the store. And that's the store. It's still the same store today.

• 32:33Shane Parrish?

  And the stores became iconic. What's the difference between the first version and the one that we sort of...

• 32:37Speaker 00

  Oh, no, the first version, it never opened up.

• 32:40Shane Parrish?

  No, but I mean, the first version you saw, like, whoa.

• 32:42Speaker 00

  It's like comparing apples and oranges or tomatoes.

• 32:46Shane Parrish?

  But I always like to talk about this because we always see sort of the end product. You know, we never see the messiness of the...

• 32:53Speaker 00

  What I do, I try to explain this. I have a photograph in my mind. It's, it's, I go into a shop. It paints a picture or it doesn't. One bad color in a great painting. I'm not a big art collector. I love nice pictures. But that changes, throws off the whole painting. It's like the wheels, the ugly wheels on a Mustang. And I mean that every car now has ugly wheels. I can't get over it. You know, you see the wheels. It's like having a bad button on a sweater like this. This is one of our bestsellers. And if you put an ugly button on this, that's what you notice.

• 33:38Speaker 00

  And I say, never give a customer a reason not to buy something. It's one of my rules, you know.

• 34:17Speaker 04

  Flowing ad budget on metrics that look great till the CFO sees them. That's bull spend and marketers are calling it out in dashboard confessions.

• 34:27Speaker 05

  I remember telling my boss, it'll be good for the brand when leads were slow. Yeah, it wasn't.

• 34:34Speaker 04

  Cut the bull spend. LinkedIn lets you target by company, job title and more. Advertise on LinkedIn. Spend $250 on your first campaign and get a $250 credit. Go to LinkedIn.com/campaign. Terms and conditions apply.

• 34:47Shane Parrish?

  So why do people buy? Or is it they just don't have a reason not to buy?

• 34:50Speaker 00

  Most people, they don't get it. You know, the logo business. And by the way, I learned this last week. They call it dupes. Do you know that? All the designer copies are called dupes like in duplicates. Hot business today because people say, well, they don't, you know, the LVs. Who the hell knows if it's a real or fake? You look at all, you know.

• 35:17Shane Parrish?

  Well, it's interesting because you sort of had, I don't want to say envied because that's the wrong word. But you liked Ralph Lauren, who had logos and at J. Crew, you did away with logos.

• 35:30Speaker 00

  Yeah, well, Ralph had the horse. And that was, I remember I was a buyer of Bloomingdale's. Ralph had the horse when he was just started and it was prestigious. The horse was prestigious.

• 35:43Shane Parrish?

  With J. Crew, one of the most fascinating things to me is you took, you did something that's incredibly rare in retail, which was you took a brand that was known for discounting.

• 35:53Speaker 00

  Same with Gap.

• 35:54Shane Parrish?

  And you made it high end.

• 35:57Speaker 00

  Well, Gap was.

• 35:59Shane Parrish?

  Was it? I don't know the early part of the Gap.

• 36:01Speaker 00

  Well, you probably, I started there in 1984.

• 36:06Shane Parrish?

  Yeah, yeah, I don't know that.

• 36:07Speaker 00

  It was a shithole with the, a disaster culturally and every other way. It was all on sale.

• 36:15Shane Parrish?

  What's the playbook then to take? I mean, they did it with Restoration Hardware too. There's a couple of other brands.

• 36:21Speaker 00

  Yeah, Gary, I know Gary.

• 36:22Shane Parrish?

  But the base rate of success is pretty close to zero in doing this.

• 36:26Speaker 00

  It's vision, imagination.

• 36:31Speaker 00

  Don't have any Dr. Knows. I call them Dr. Knows telling you it's not going to work. If I, look Old Navy, I went out. And I did it.

• 36:41Shane Parrish?

  It's interesting, you make decisions mostly on your gut.

• 36:45Speaker 00

  And research backing it up.

• 36:48Shane Parrish?

  Well, I was just gonna say, but you're always gathering information. Are you pattern matching when you make decisions?

• 36:54Speaker 00

  Well, it's funny you use that word. The whole business is recognizing patterns. It's, you know, there's patterns that go on. And for me, I have to preempt the pattern. And then I push the team, like right now, personalization. Two years ago, we had painted dogs on a tote, on a tote bag. Eighteen of them that day, gone. Two years ago. I have still, in the last two years, I wanna, I want personalization to be who, what we do. It personalizes the goods.

• 37:38Speaker 00

  You know, so we have, I don't have my bag here, but painted initials, cool. The dogs, painted dogs. But I'm trying to get people to move. And it's hard.

• 37:55Shane Parrish?

  Yeah.

• 37:55Speaker 00

  So.

• 37:56Shane Parrish?

  Is the reason that focus groups are so difficult in retail? Because people are telling you what they want, but they actually have to be led?

• 38:05Speaker 00

  They're difficult for me. Everyone else does them.

• 38:09Shane Parrish?

  But they don't seem to work.

• 38:11Speaker 00

  I don't.

• 38:12Shane Parrish?

  Or do they? I don't know.

• 38:13Speaker 00

  Look, I don't know. It's not what I do for a living. I do, I say, see around corners, you have to have a vision.

• 38:22Shane Parrish?

  It's, it's interesting, because the outliers on both ends, positive and negative, don't use focus groups. But everybody's sort of in the, so it's almost like a guaranteed average in a way.

• 38:33Speaker 00

  The world, this is funny. A friend sends me 20-plus page article two weeks ago.

• 38:40Speaker 00

  Talking about how average the world is today. I totally, I called him, I said, wow, you are on. He talked about cars, he talked about designs, he talked, this article, he didn't write it, but the world's average. And the, and you have to be not average if you want to do what you do. You kind of, for me, you break the rules. But the rules are, you know, common knowledge isn't that common as, you know, it isn't. And I'm an anti-authory guy, I don't like that. I don't like to, I'll never forget, I used to work in the shipping room. I had an idea.

• 39:25Speaker 00

  You know, I used to tick it, you know how you see those hang tags on buttons? So I used to walk around bending down with the racks of coats like this. I took a rolling chair, I'm going down the aisle, it was like, my father got so angry at me. He wasn't my, who knows who my boss was. But that's what happens in corporations. I, no one wants to change the rules in a way, not that he was a corporate guy.

• 39:55Shane Parrish?

  Well, this is interesting, this is a fascinating sort of like nuance here because in a corporation, you can't get fired for following the rules. You know, I just follow what you told me to do. So I'm absolved of all responsibility or judgment, right? Like, nobody's gonna get fired for following the rules. I mean, you do at the CEO level, but aside from that, you're basically.

• 40:14Speaker 00

  Well, you have to, you can follow the rules. On the other hand, you have to have a drive in you that's creative and can make changes. And when I worked in the department stores, you know, I'll never forget, I had some simple ideas for the financial person, you know, none of them. They didn't ask people. I ask people. You know, they know, young people don't have any baggage.

• 40:40Shane Parrish?

  Well, thi- this is fascinating because you say you're anti-authority, but when you say that, what I hear is you're not anti-authority, you're really a rule-breaker who's constantly questioning things, which comes across as anti-authority. But you're vacuuming up information from every available source.

• 40:55Speaker 00

  When I hear something two or three times, I bring it to work immediately. Every weekend, I have a Monday morning weekend update. What is it? It's a combination of me seeing things that are an idea. I look through, not that I like the fashion magazines, but I look through every picture on monthly. And if there's a picture I like, I cut it out. Last weekend, it was a great picture. It was a designer, I think it was Fendi. And they just showed the women's heads.

• 41:35Speaker 00

  And they had a sweatshirt on, each of them, in four, in bright colors. So I cut that out. And I said, this is something we will do. Well, we are doing hooded sweatshirts in bright colors. And then I, you know, I always do detective work. I'm addicted to detective shows. Great, great detectives solve cold cases. There's such a difference. Anyway, I then, I asked someone who I know, I said, are there any companies we can do a collaboration with? We do collaborations, we get together. And you know, we did it at Jake, we kind of invented it.

• 42:20Speaker 00

  Now everyone's, they're all collaborating with all the famous brands. So it doesn't make it unique. But anyway, so she mentioned this company in England. I went online, looked at it. And they had a hoodie hat, a bakalava, whatever it's called. So I said, we're gonna do that hat. We sell a million cashmere hats. We're famous for that. And by the way, being famous for something drives businesses because you're dominant.

• 42:53Shane Parrish?

  How much of retail do you think is theater?

• 42:56Speaker 00

  Theater?

• 42:59Speaker 00

  Well, you know, Stanley Marcus, Neiman Marcus, was known for that. I don't think it's, you know, the hottest supermarket in America now. You know, Ear One.

• 43:13Shane Parrish?

  Yeah.

• 43:14Speaker 00

  I was in one in L.A. about three or four weeks ago. I don't call anything theater. Theater is great product, looking like a painting, and going in, for me, I never had, Old Navy, by the way, it was an amazing business in its day. I had Schwinn bikes around the escalator. We sold out of them very quickly. And then the guy I knew who owned, you know, he's an investor, not a close friend, but Schwinn decided not to sell us because we weren't buying them from a dealer.

• 43:56Speaker 00

  But the business, first apparel business to hit a, what is the number? I think they hit a billion dollars.

• 44:05Shane Parrish?

  That's true.

• 44:06Speaker 00

  First one in apparel, but now I'm sure there's many others. But I just follow the guidance of...

• 44:16Shane Parrish?

  Yeah.

• 44:17Speaker 00

  But I also absorb detectives. I always come in every day, I say, I see these, I'm addicted to true crimes.

• 44:24Shane Parrish?

  You're always gathering information, you're always looking, you're always questioning and probing.

• 44:29Speaker 00

  And patterns.

• 44:30Shane Parrish?

  Which helps you develop the patterns.

• 44:31Speaker 00

  And I see a picture.

• 44:32Shane Parrish?

  Yeah. Who do you think are the great retailers today?

• 44:37Speaker 00

  I don't like to name competitors, but I'll tell you some. Well, T.J. Maxx.

• 44:43Shane Parrish?

  Okay.

• 44:44Speaker 00

  I always name Carol, because Carol Myrowitz, T.J. Maxx is the honest discounter, and she's a great merchant. The only thing is, you have to keep changing.

• 44:59Speaker 00

  Acts the wrong word, but you gotta keep changing and seeing down the road. And I have these ideas.

• 45:07Shane Parrish?

  But you can only do that if you touch the territory. Like when you hopped on the plane, you went to the store, when you're constantly talking to everybody, when you're getting all the information sources, that's how you rapidly adjust. Cause you're not looking at a.

• 45:20Speaker 00

  If you are not curious in any, any field, whether it's nonprofit, profit, selling cars and all that, any field, product is always driving and product is about emotion, in my opinion. Someone said this the other day and I kinda took it on myself to say it. I have a love affair with the companies that I've been involved with. You know, Madewell, you know what happened, how I got that name?

• 45:54Shane Parrish?

  Yeah.

• 45:55Speaker 00

  So David Mullen, who's worked, he's a great wash guy, unfortunately, he's an old friend. Ten or fifteen years ago, I was at J Crew. Well, you know how old Navy and the whole concept, I tell you. So David has a logo, Madewell since nineteen thirty seven. He shows it to me, was actually the logo. He said, what do you think? I said, it's fantastic. He said, well, do you wanna buy it? I said, if the pro- yeah, but what about you? We can't afford it, whatever. I bought the name. I owned the name and when we went public at J Crew, then we did Madewell.

• 46:40Speaker 00

  And I had a vision. I loved work clothes then, I carhartt and all that. But I had a vision for it, but you can't do anything well unless you have the right team. So we struggled for the first three or four years. Um, we're gonna do men's and women's and I decided, let's get rid of men's. Now, I didn't have anyone to talk to about this, other than myself.

• 47:05Shane Parrish?

  Yeah.

• 47:06Speaker 00

  But I never thought about it that way. So we got rid of men's and then Sam Sack, who is, works with me and us, creative guy, was at J Crew for fifteen years. And he left for a year, hired him back, he became the creative director. Of Madwell, boom, boom, boom. And Madwell was a great company until it wasn't. You know, when we had a two billion dollar, well, don't even get me started with selling companies because the mercenaries. And by the way, Gap, you know, when I left there, I didn't say that no one called me on the board. Eighteen years. Hello? Wow. Can you believe that?

• 47:51Speaker 00

  Except for Steve, who didn't think you should be fired in the first place. Right, exactly, exactly. What makes something a classic look? Yeah, it's a good question. I always say, if you know, you know. I wear clothes that have no expiration date. This shoe, I found it in Paris. It's Alden, an American company. And I must have been forty, probably forty years ago, it was my favorite store, Fessenob, until they were bought out by a big American department store, then it's, then it's over. So this shoe is from Alden.

• 48:35Speaker 00

  I've been wearing not this one shoe. We used to buy from Alden at J. Crew. And my good friend Todd Snyder, who's a men's designer, he buys from Alden. And I asked him about a year ago, I said, can you ask them to do a special, this shoe again for me? I ordered ten of them. That's awesome. I wear this and I wear another one. This jeans never go out of style. But as long as you don't wear the big ones, the skinny ones. These are cashmere socks that we started doing at J. Crew. They, whatever, and now we do them at, this is clothes, this scarf, it's forty years old.

• 49:18Speaker 00

  Michael Drake was a good friend and I used to buy from him in London, his collection. There is a Michael Drake now, but it's not the same. I have about twenty versions of this. I bought them wholesale because, you know. And this sweater.

• 49:35Speaker 00

  This is our third year at Alex Mill, but forever.

• 49:42Shane Parrish?

  Yeah.

• 49:42Speaker 00

  And it's cashmere, and our prices on cashmere are good. Oh, I only do vintage watches because I like vintage and old is new today.

• 49:54Shane Parrish?

  Yeah.

• 49:55Speaker 00

  Vintage business is this way, and it's unique. You're not like buying, you're not gonna see, well, a hooded sweatshirt never goes out of style. Now, that's a novelty. So, you know, I don't know.

• 50:07Shane Parrish?

  I love this idea, clothes that have no expiration date.

• 50:10Speaker 00

  No expiration date, right.

• 50:12Shane Parrish?

  No expiration date. Farnham Street, the website that I run, is about knowledge that has no expiration date.

• 50:17Speaker 00

  Really?

• 50:18Shane Parrish?

  So it's timeless wisdom.

• 50:19Speaker 00

  Timeless, and it's, whatever I wear, and it's things, and I didn't learn this. Everything I buy, and it's internal to me, you know, I don't, it's like if someone wears something. Oh, that's the guy with the purple shirt.

• 50:42Shane Parrish?

  Right.

• 50:42Speaker 00

  Or that's the car with the ugly hubcaps. It's, I like the screen.

• 50:47Shane Parrish?

  Yeah.

• 50:48Speaker 00

  I like style, and I like a uniform. That's what I do, and I wear the same Alex Mill, you know, slub T-shirt, blue, every day.

• 51:00Shane Parrish?

  Perfect.

• 51:01Speaker 00

  You know, I've always had a uniform.

• 51:03Shane Parrish?

  We always end the interview with the same question, which is, what does success look like to you?

• 51:08Speaker 00

  I think what it looks like is a couple of things. If you can impact people's lives in a positive way, that to me is the most, the best sign of success. And of course, and if I could also be very pleased with myself, that's another sign. But I think the biggest compliments I get are from people, you know, we had that, I think you knew about the Gap reunion. Did you mention that to me?

• 51:45Shane Parrish?

  Yeah.

• 51:46Speaker 00

  Hundred and fifty or sixty people.

• 51:48Shane Parrish?

  Yeah.

• 51:49Speaker 00

  Were there, Ken Pilot, who used to work with me, and I am, I don't, success, it's not being rich.

• 52:03Speaker 00

  Only. It's not even being rich, because I know successful scientists or successful whatever, but I think it's impacting people's lives. My biggest compliment, I say this, I've said it on CNBC, is when I'm called a mensch, you know what that word is.

• 52:22Shane Parrish?

  Why don't you explain it for everybody so everybody knows?

• 52:25Speaker 00

  Mensch is in Yiddish, mensch is like a nice person, normal, hamisha, down to earth. And I like, and I like talking, talking to people in a parallel way and not, I don't talk down to people because I appreciate who I am and what I do. Now, no one escapes. You know, I go through certain mood issues, of course. I'm always trying to better myself. But I think success is, it's just not about money. Most people might say that. But you

• 53:06Speaker 00

  have to be, I'm very pleased with what I've done, more so over the last few years, because I have changed people's lives. Because I had a reunion two weeks ago, last week, with the field team at Gap, you know, 15, 20 of us. And they all thanked me and they said they made their lives much better. And that's, that's success.

• 53:40Shane Parrish?

  Thanks for listening and learning with us. For a complete list of episodes, show notes, transcripts, and more, go to fs.blog/podcast, or just Google The Knowledge Project. Recently, I've started to record my reflections and thoughts about the interview after the interview. I sit down, highlight the key moments that stood out for me, and I also talk about other connections to episodes and sort of what's got me pondering that I maybe haven't quite figured out. This is available to supporting members of The Knowledge Project. You can go to fs.blog/membership, check out the show notes for a link, and you can sign up today. And my reflections will just be available in your private podcast feed. You'll also skip all the ads at the front of the episode.

• 54:26Shane Parrish?

  The Farnham Street Blog is also where you can learn more about my new book, Clear Thinking: Turning Ordinary Moments Into Extraordinary Results. It's a transformative guide that hands you the tools to master your fate, sharpen your decision-making, and set yourself up for unparalleled success. Learn more at fs.blog/clear. Until next time.