It’s clear that Jos. A. Bank is beating Men’s Wearhouse in the fierce competition for customers.
Jos. A Bank’s shares have gained more than 8% in the past six months, while Men’s Wearhouse only gained 1.6%.
Both retailers market to men who want to look current, but can’t afford to shop at Nordstrom. Both face similar challenges in getting cash-strapped customers to go shopping.
So what does Jos. A. Bank have that Men’s Wearhouse doesn’t?
Those infamous “buy one, get seven free” sales.
“Those promotions are why Jos. A. Bank is getting foot traffic that Men’s Wearhouse isn’t,” said Brian Pitera, a principal of consultancy A.T. Kearney. “To compete, Men’s Wearhouse is going to have to step up promotions and advertising.”
While Jos. A. Bank’s promotions sound too good to be true, the brand actually manages to make money by selling the products at higher initial mark-ups than necessary. In other words, Jos. A. Bank builds the cost of free products into the one full-priced suit you purchase.
And once customers are in the store, Jos. A. Bank can count on them making impulse purchases on accessories like ties and belts.
“Critics can hate on Jos. A. Bank’s promotions and call them a ‘bait and switch,’ but they actually have a tried-and-true tactic for getting people in stores,” Pitera told us. “That’s more than Men’s Wearhouse can say.”
To get customers back in stores, Men’s Wearhouse is going to have to come up with an aggressive promotions strategy, Pitera said.
“Men’s Wearhouse doesn’t need fancy designers or big names,” Pitera said. “What they need is to give customers the value they’re looking for right now.”
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