To focus solely on growing its Boston Proper women’s apparel title, The Mark Group plans to shut its Charles Keath gifts catalog early next year.
Charles Keath, which represents about 20% of the $157 million Mark Group’s sales, was a “steady Eddie,” says executive vice president/chief creative and Internet officer Skip Hartzell, but “we couldn’t see how we could grow it past its present size.”
Charles Keath’s sales ebbed with its circulation, which peaked at 21 million in 1999 and was steadily reduced each year since to 13 million this year, says executive vice president/chief financial officer Ken Fischer. In comparison, Boston Proper’s sales have increased more than 30% during the first quarter of this year, while the title’s 12-month buyer file has grown by 20%.
The Mark Group had the Charles Keath catalog on the block for the past 18 months, Hartzell says, but the company didn’t receive any “serious” offers. “Most offers we received weren’t purely cash,” he says, “so we didn’t want to get into a financial situation.”
The Boca Raton, FL-based company closed its Mark, Fore & Strike country-club apparel catalog last year and sold a majority share of the brand’s retail chain earlier this year to a group led by its senior vice president of merchandising, Larry Autrey.
The Mark Group plans to mail a few Charles Keath liquidation books before closing it for good. While folding the title will cause an immediate decline in sales, profits will increase, Hartzell says. “Sometimes you have to take a step back,” he says. “We had to lower our expenses, simplify, and streamline.”
In anticipation of the closing, The Mark Group has laid off five employees in its merchandising group. Other Charles Keath brand managers, buyers, and consultants will also be laid off following the catalog’s closing.
As for Boston Proper, the company hired a new brand manager, Greg Van Wormer, last December to focus on what will become The Mark Group’s sole catalog. In January, the company spun off a sports-related apparel catalog, BP Sport. The book was successful enough that the company plans to mail three editions of BP Sport next year.
The company hopes to come up with other Boston Proper spin-offs down the road. “We have more ideas than we have time for,” Hartzell says.
Since Boston Proper specializes in warm-weather apparel and swimwear, one of The Mark Group’s primary goals is to develop more of a holiday-season business. “It’s something we’ve been weak at in the past,” Hartzell says. “We want to get people to think of Boston Proper for gifts.” Boston Proper, whose average order size is $165 — compared to Charles Keath’s $100 average order — targets “active contemporary” women 35-50 years old.
The Mark Group is also formulating plans for a retail chain, and Hartzell says the first Boston Proper store will likely open in late 2004 or early 2005. “Stores take awhile,” Hartzell says. “Now we’re just looking at our direct channels and playing around with concepts for stores.”
The Mark Group aims to model its retail expansion after that of fellow women’s apparel marketer J. Jill Group, which opened its first store nearly four years ago. Today J. Jill has 97 stores, which account for 38% of its sales.
The Mark Group may soon have something else in common with J. Jill. The former DM Management changed its corporate name to J. Jill Group a few years ago, after closing its Nicole Summers and Carole Reed catalogs to focus on the J. Jill brand. Now that Mark Group has shed its Mark, Fore & Strike and Charles Keath titles, the company is considering changing its corporate name to Boston Proper.