Podcast Episode 101: Tony Drockton | The Impact of Knowing Your Customer

May 10, 2018 1:49:35 PM

Tony Drockton and Bob Phibbs

Bob Phibbs, the Retail Doctor, sat down at Netsuite18 with Hammitt Handbags' Chief Cheerleader Tony Drockton to learn what it takes to be a successful retail business.

Retail Doctor Podcast-Available-in-iTunes

Three Key Takeaways:

  • Long term focus on brand equity follows European price integrity
  • Know who your customer is and who they aspire to be
  • Letting go is tough for an entrepreneur, but you have to get others onboard so you can do what you love.

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Transcript

Bob: Hey, it's Bob Phibbs, the Retail Doc with "Tell Me Something Good About Retail." And today, I'm with?

Tony: Tony Drockton.

Bob: And Tony and I met at the Oracle...

Tony: Pre-party.

Bob: ...pre-party where we both just kind of started laughing because he gave me his business card which I thought was a business card. Because I couldn't understand what he was saying about the name of his company. So, tell us about your company and he's...

Tony: He's talking about a bromance that we had by the way.

Bob: Tony.

Tony: I don't know who he was either, but it was about five minutes of back-and-forth, fun, fun, fun. And then he was gone. So, I am Tony Drockton.

Bob: Because he's from Los Angeles, and I'm from New York. And the three-hour time zone difference was just like, was just terrible. But he makes these amazing bags. I was just listening to one of his customers tell me how wonderful he is. 

Tony: Thank you.

Bob: They've have been, what, 10 years you have been...You're wholesale only and now you're in 800 locations. So, how did you guys start? What can you tell me about it?

Tony: Well, I'm the chief cheerleader of Hammitt. We're a Southern California fast-growing women's handbag accessory line and, you know, had a lot of fun today. I think heard us talk about physical meets digital. And I don't know. What else can I... I'm nervous, man.

Bob: You're in Las Vegas. You're a Los Angeles brand. You started at the beach. You have these great events where you go through and you said your customers are like, passionate about you and like, you kind of pooh-poohed social media at first, right?

Tony: Thank you, thank you. Yeah.

Tony: You know, in all honesty, we had to pick our battles. So, 10 years ago my battle was to just get partners to trust us and carry the brand. I went wholesale when everyone was starting online. And it took about five or six years to get some traction with enough boutiques and specialties carrying our line, following our business model, carrying the culture, and everything that I wanted them to know about us to their customer, building relationships one at a time.

Bob: So, how do you find that retailer that fits into that?

Tony: Literally one at the time in the beginning, I walked in myself.

Bob: Wait a minute, how many accounts you had right now?

Tony: Eight hundred. But, you know, it's a tipping point, right Bob?

Bob: The people don't appreciate the shoe leather anymore.

Tony: No. 

Bob: Right. But you have to just go out, and go out, and see him.

Tony: Yeah. You know, you think that it doesn't work, but it does. You know, pick up the phone, make a call.

Bob: Nice.

Tony: Stop in, say hello. Stop in again, see how it's going. Simple things like that and then once I was able to get some people to believe in me and join me on the team, they took over some of those hats and here we are today, you know, 10 years later, 10-year anniversary, 800 stores carrying us. What you don't know is the business model. So the business model we really follow, Bob, is we took that European model, that long-term focus on brand equity and we brought that over here for an American handbag brand. And we really are focused on being the next great American handbag brand that follows that European model of price integrity, one price, everyone pays it, brand integrity. 

Bob: Hold on one sec. That means that's the same whether I'm getting online or in store, that's it?

Tony: Yeah.

Bob: So, what if I'm with Jane's, I don't know, Handbag World, and I'm carrying Hammitt. And you find out I'm like, 30% off every day or something.

Tony: Well, luckily in America you can legally enforce what's called minimum advertised pricing. Every retailer that is...

Bob: And that's it. If she doesn't do it...

Tony: You don't have to sell them to anyone.

Bob: Pull that out?

Tony: Yeah. It's okay.

Bob: So you really support your dealers then?

Tony: Yeah. Because of the people that partner with us, I can give them a lot support. Imagine a $500 to $700, you know, all leather, great craftsmanship handbag that actually sells for $500 or $700. My retail partners love it. My customers love it even more. You know why? After they've decided to carry our brand, six months later, a year later, our core products are still sitting in the same store they carried it at the same value that they saw it.

Bob: So, it's not in and out, gotta get something else in. It's classic.

Tony: We have a fashion portion of our collection now because we're large enough, and we've actually moved from two collections a year to four a year. This year we have six and we've layered on every two weeks a quick drop following the, you know, athletic footwear industry. So, what we're doing every two weeks, we drop a color, we drop a new design, we drop something exciting either a collaboration or something ourselves which keeps it even more fresh. 

Bob: And you reaching it through e-mail or you reaching it through social media? What are you doing with it?

Tony: Everything. So, you know, we have a really, you know, well-segmented e-mail list, high quality. Our social media right now is fairly robust, primarily Instagram, Facebook. We have influencers all over the country, about 200-strong almost every state. We throw a lot of events. We talked about experiential retail.

Bob: Your target girl, I mean...women.

Tony: You know, I found that I can describe her more by who she is in personality than age and demographics. She is I mean, she feels...

Bob: Is she like you?

Tony: Yeah.

Bob: She's outgoing, she's confident, she's...

Tony: Yeah. Either she's outgoing and confident physically the way you see her or inside. She definitely wants to be married. She probably wants children. She wants to be successful whether she is now or was. She really cares about her community, and she loves when somebody recognizes that she made a great choice or she did something really good. So by wearing a Hammitt, she's in the club. We'd like to say almost the cult. It's like she knows something that other people don't know which is that she made a decision to buy not the obvious choice, the brand that not everyone else was carrying when she purchased it. But suddenly she sees more and more because other people are finding out about it and they're finding about it from her.

Bob: And it's not her age.

Tony: All ages.

Bob: She's old or young, it doesn't matter.

Tony: We like to say we're multigenerational. I do a lot of trunk shows, a lot of appearances. We do... I try to be out where my ultimate customer and client is and I found we got moms. We've got daughters. Sometimes we have daughters, moms, and we have some granddaughters.

Bob: That's amazing.

Tony: Can I do a plug?

Bob: Hit it.

Tony: We are the brand that's not for a reason, not for a season, but for a lifetime. And if you call now...

Bob: You get those Ginsu knives.

Tony: Right, right, right. And wait, but there's more.

Tony: But think about it, what's the hottest category in apparel, in footwear, in handbags? Vintage.

Bob: Absolutely.

Tony: Vintage is on fire. Why is vintage on fire?

Bob: It seems more authentic. Back when stuff was made well.

Tony: I think it's on fire because they can't find the new brands that are doing what they want them to do. They can't find a brand that they've really embraced and love right now that's currently on the shelf that's unique enough for them to carry every day. It's a new club, and the club is I'm carrying something that has a heritage, that has a story, that's been around for not just my generation, maybe my mom's and grandmother's, and I feel good about it. And you know what? We sit right next to vintage, and our top partners all over the country, and I hope one day to be in that conversation. That's what I see. Just the part of it.

Bob: And by the way you got to spell the name of your business.

Tony: Hammitt, H-A-M-M-I-T-T.

Bob: So, what's the greatest challenge you think you ran into in the last three years? Because you're very customer-focused. You're really customer-focused. So, just what's like the greatest challenge and how you solved it or trying to solve it?

Tony: The greatest challenge in the last three years is, this my third time starting a company, was to realize I took it as far as I could on day-to-day. And so, I brought in a team to help me find a CEO. And I brought on a full-time CEO in December. His name is Andrew Forbes. He was actually the founding COO of Jimmy Choo, and he was my first mentor. And being an entrepreneur and a person that really likes to control every detail, being able to step back, and let him take over all day-to-day duties and make all decisions only with a lot of guidance.

Bob: A lot of trust.

Tony: For an entrepreneur, it was huge for me. Luckily I had a lot of support. I got a lot of the people that have done it before me that are friends, and I have to say, it's been three and a half months, letting go has allowed me to get back to what I love, creativity, getting out, talking with the customer.

Bob: Cheerleading.

Tony: Cheerleading with a pompom. I mean, I've taken away most of the stress that probably had really piled on because I didn't have anyone to take it off of me.

Bob: Yeah. No, I think that's really important for everybody listening because that's what makes retailing great is you have this vision and then sometimes we can't let go. I thought yesterday we're listening to Rachel...

Tony: Rachel Zoe. Shoes, shoes.

Bob: Rachel Zoe. Sorry. Got that. And one of the things that she thought was most important was she learned she had to be at the idea part first because too many ideas came to her at the end where there's nothing she could do about it and she couldn't influence it. And I thought that's how you lose a brand.

Tony: Oh, I forgot that.

Bob: I can't do that. I can't change it. We've got to run with it or worse we can't run with it.

Tony: Right.

Bob: But dude, we've worked six months on this project. If we don't have this, we have nothing for holiday. "Well, I don't care. We're stopping it." So, entrepreneurs hate that moment and then you start blaming everybody instead of, "I'm in the wrong place right now."

Tony: And she I think, I follow, I remember, she said she brought in the team so she'd get back to that point where she was involved in the team. Is that what she said?

Bob: That's what I think about it.

Tony: Yeah. That was a good comeback. I forgot that.

Bob: Because that's what you've done.

Tony: I'm back to that. I'm back where...

Bob: And you're liking it better.

Tony: I'm in the place where I love to be. I love to be in front of our clients one-on-one and hear their story.

Bob: And you trust them. I think that's kind of it. So, if you were telling a friend...So you've got this friend. I love this question. So, you've got this friend who's gonna go into some type of retail business. So, they're knowing they're gonna open a brick and mortar business. Got it?

Tony: Yeah.

Bob: That's where they're going.

Tony: Got it.

Bob: You explained from over Starbucks, you try to be supportive. What would you tell somebody right now? What should they do?

Tony: Well, I would say, find the new, the new wave of successful retail and spend some time. Even go to work in them. Work at a Starbucks for a day. Spend the whole afternoon in the Bonobos. See if you can just ask Warby Parker if you can do an internship. Do anything...

Bob: But she's why Warby... But she's 45.

Tony: That's fine. Hey, you know what? Learn from the successful ones. By the way it's free, and you might even get paid for it. And then once you feel like you got it or at least enough of it, and hopefully you have the financial backing and you've got what I say the [Inaudible 00:10:11].

Bob: You're very willing.

Tony: You're an entrepreneur. You're ready to roll the dice. You will be successful. See, there is really no new retail.

Bob: No.

Tony: You know what it is? It's retail refresh, I call it. It's retail refresh. The same principles that brought Sears to the top of its game and then the Walmarts to the world, and now the Amazons are the same. What was it?

Bob: Connecting with customers I think.

Tony: Connect with your customers and give them what they want at that time.

Bob: But if you get in the new successful retailers, you realize, "Oh, that's how mobile fits into this." You're not learning it, right? And by God forbid, you're not the one trying to just...for our listeners, you're not the one trying to learn how to do this stuff.

Tony: No, no, no.

Bob: You just wanna see how the whole fishbowl works and then you're like, "Okay. So, this is what it's gonna take," versus, "You know, I've always wanted to open my own handbag store. I think it will be a lot of fun, and I got some money to play for it." Because those people you're like, yeah, that's just throwing your money away.

Tony: Talk to the chef that opened his first restaurant. Find out what that went. He loved to cook, but he forgot running a restaurant, only a portion of it is about the great food. The rest is... 

Bob: Service, managing...

Tony: ...managing people, managing finances, managing legal. 

Bob: ...cost of goods.

Tony: ...cost of goods, physical, all. So, there's a whole picture. So, if you're gonna open a retail business and you don't understand all of those, take some time to at least get your feet wet. 

Bob: Nice.

Tony: And once you feel comfortable in a couple of the areas, hire the other ones as Rachel Zoe said and get in there. And then go as fast as you can. Never take your eye off that customer.

Bob: That might even be if you're struggling, go and take a job in one of those places, and learn someone that's not struggling. And suddenly go like, "Oh, that's why I'm missing it."

Tony: By the way, six months into launching Hammitt, I figured I need to learn this industry because I'm not from it. I actually went to work for a woman, Angelique that I've known forever for eight months as a free intern while I was still building Hammitt. So, I'm actually doing what I said, and it was the greatest choice ever made. I learned everything about showrooming [SP] and sales, production, and every... And then once I felt like I got it, I came back and I pushed even harder.

Bob: Nine, nice. And what's the best advice you ever received?

Tony: Well, the best...

Bob: Besides being on this podcast. That's all and the same. What else?

Tony: The best advice I ever received over the 10 years in this business is all of the bad advice. Let me tell you why, because every time I received this is the way it's done or it'll be okay or that's how you do it. And if I'd be specific, make it cheaper, you gotta fit into this price point, you don't need to be that high of quality, nobody's gonna understand your brand. That was all given to me, and every time I just said into my gut, how does that feel if I were the customer of my brand? And when it didn't feel right, when it didn't feel like that would resonate with somebody if they were in the room, that was great bad advice. Thank you. I'll know not to do that.

Bob: So, how did you grow a spine like that though? Because that's...

Tony: Oh, man, lots of mistakes in the other company.

Bob: Yeah. We all done that.

Tony: You know, shortcuts are exactly what they are. They're a shortcut. So, you know what they say, don't do anything that you wouldn't want your mom see you doing, right? It's kind of the same. If you really could feel good about it, you know.

Bob: Certainly. Yeah. I got ya.

Tony: So, I'm not perfect either, but I can tell you I've tried to use that as my guide post for decisions. And it seems like it's resonating. You just met someone that I don't even know that walked up and said, "I love..." Like...

Bob: You know, someone actually stopped and right in the middle is like, "I really love your bags." I was like, "Oh, so why don't you get somebody else's?" And she was like, "On it. This is why I do it." And she's not from Los Angeles.

Tony: Bob, while I'm here, it's been amazing. People... And, you know, I don't know how they know. 

Bob: Well, this guy is standing here in this beautiful blue... I don't know, brocade. I don't what they call that material, but it's like an amazing piece which frankly I would love to wear myself. So, he's confident about who he is, but also you just don't have this negative vibe. I imagine you don't hire people like that either.

Tony: Yes. We only hire nice people. It's true. We used to have a saying in the company, "No assholes." What we mean by that is we can't be one. We don't hire them. We don't partner with them. We don't let them make our product, distribute our product, sell our product.

Bob: Wow.

Tony: And God forbid, you let them buy it because, you know, those really complaining whiney, those people that just never give up, they're the only ones that are not allowed to really take advantage of my lifetime warranty which is a no-question-asked lifetime. But I can promise you if you're listening to this, please be nice. Because if you're not nice when one of the few Hammitt's don't deliver, we're just... We really don't want you.

Bob: That's a great point because people think that like, I'm gonna beat up on my vendor.

Tony: Oh, my God. No. 

Bob: And that's gonna be the greatest thing because that's smart because I had a trade group that said you really have to do that. You're like, "Why would you do that?"

Tony: [Crosstalk 00:15:09] When I say, no assholes, I'm talking to myself in the mirror right now. There's times I wanted to just like, "Wah." Even sometimes just simply when I have a person having a bad day. Maybe they're ringing me up somewhere, we met at a getting coffee. I've now turned it around and I call, you know, I met a guy called himself the day maker. And his whole job is to make people's day.

Bob: Bring them out of this.

Tony: So, I'm the moment maker. My job is just take a second. Once in a while I'll be like, "Hey. Maybe these people before got you there. What can I do to make your day way better because I got time to do that?" And so, you have...

Bob: That's an incredibly elevated way to think that, man.

Tony: And so half the time they'll go, "You just did."

Bob: Nice.

Tony: And half the time they don't. And I'm like, "Hey, I gave it a shot."

Bob: I got 50/50.

Tony: I got 50/50.

Bob: The world's better.

Tony: I feel better doing it that way than the old Tony which was like, "This person just crushed me. I'm just..." And, you know, why let that person...

Bob: And I have to get even with you by, equip or, you know.

Tony: Yeah. Why carry that person with you all day? At least I'll be able to move on from it, you know. And with employees you can't. So, don't hire...and with vendors you can't.

Bob: I love that. So, what would you... So, I wanna make sure that I am being really... It's been really nice. Tony has been very generous with his time today and chatting with me here on... And the name of the podcast again is "Tell Me Something Good About Retail." So, why are you so bullish on retail?

Tony: I mean, my dad own a little grocery store. I was raised in it.

Bob: Where about? In Los Angeles?

Tony: Cleveland, Ohio.

Bob: Cleveland.

Tony: And, you know, and my dad... and he was my hero. Honestly, our relationship from beginning to he just passed was never nothing but a kind word. He ran his store based on these principles which were it's all about the customer. You know, back then his technology was a book with paper next to it, and if you were ringing people up and they ask for something, you wrote it in the book.

Bob: And you responded. 

Tony: And if they complain, you wrote in the book. No. And then he would review it. If enough people ask for something, he would order and get it in. He'd cash people's checks for free. He had us walk people home with their groceries. His whole philosophy was give them what they want, treat them well, and they'll keep coming back. And it might have been a convenient food mart, it might have been three 7-11's in size. But as a kid it was huge. It gave me all the basic principles of any successful retail business. And why do I love retail? Because it's where I learned how to be chief cheerleader. I learned that while six people are in line, the first one is angry, the second was in a hurry, the third one is really slow and takes forever to do things while two behind them are waiting anxiously. And you had to just adjust and enjoy. And it was the greatest gift. I also learned you're always cleaning while you're working, you're stocking, and you're running around.

Bob: The day goes quick that way.

Tony: Oh, my gosh. Your days flies by if you're constantly moving. If you decide to go in retail, I promise you you'll never ever look at the clock. And if you're looking at the clock here now, you don't know retail.

Bob: They don't understand retail.

Tony: You don't understand retail.

Bob: Yeah. My pet peeve is I walk into a...as, you know, listening to this, I walk in a retail store and there's the owner somebody sitting behind the counter.

Tony: Oh, a stool.

Bob: With a stool thing, whatever. I would have a bed of nails underneath that. But even in the fanciest malls here, I was checking them out the other night, fanciest brands you can imagine and the girl's there watching obviously a Facebook video with her head down. I'm thinking, "Do you realize what that feels like for the shopper to walk in?"

Tony: Now, let's turn it around. What's the best experience in retail? Can I ask you?

Bob: Me?

Tony: When you walk in and you go, "God, that person was awesome. Or that store was awesome."

Bob: Dude, this jeans I bought in San Francisco. These jeans, as my listeners know, this just under 1000 dollars and...

Tony: Whoo-hoo.

Bob: Yeah. I'm serious. Almost everything I have on is because a salesperson sold it to me. If they do their job, I have to reward them.

Tony: How'd she sell those jeans?

Bob: She met me in the elevator, and I just walked in this haberdashery. And she's like, "Oh, have you've ever been in this store?" And I said, "Yeah." And we just chat on the way up and then we got out of the elevator on the 7th floor, and she goes, "Well, may take you to show you around?" And I said, "Well, sure." And she showed me the jeans and I saw the price point, and was like, "Yeah. I'm never trying those on." She's like, "Oh, no, you're gonna try these on." I was like, "No, I'm not." She goes, "You know, a lot of guys probably like one size up. They're a little too trim fit." and I go, "Yeah. I'm never gonna try." She goes, "Well, then you're just gonna try them on for the hell of it, for me. Right?" And to make a long story short, it was the best conversation. And I made a... If any of you retailers are listening to me, I made a decision long ago if you're selling me the way that I teach people how to engage with a human being...

Tony: You're buying it.

Bob: ...then you get the deal. So, that doesn't matter if it's jewelry, if it's art, whatever it's gonna be, if you keep up the conversation with me...

Tony: Nice.

Bob: ...and you help me do what I wanna do which is this sounds crazy. Why would I do that? And I did. And it's terrible that I don't remember the name of the brand which is on the back. 

Tony: That's all right. You love them. 

Bob: They're cool. I love them ,and I feel special when I wear them which is the same way you feel with your jacket, which is same way with your woman feels like. She's confident inside, but she made the choice whether someone else knows it or not. She like, "I wanna be successful and this is my vote. This handbag is my vote that I'm gonna be successful," or, "I am successful," or "This is what matters to me." So, I totally get you, dude.

Tony: Whoever listens to you, I got... Bob just... That's how you do it.

Bob: [crosstalk 00:20:24]

Tony: Like what you just said, it's not how much you pay for something.

Bob: Got it.

Tony: It's how much it makes you feel how great inside.

Bob: That's always there.

Tony: And how much you carry the energy of the moment you made the decision and then what reinforces it when someone else walks up and goes, "Bob, are those... Oh, my gosh."

Bob: Exactly. Right.

Tony: "I met that girl. How amazing is she."

Bob: Exactly. She's been there by the way, for 40 years in that one place.

Tony: That's my holy grail. If someone talks that way about one of my team members by the way, I glow.

Bob: You did it.

Tony: And I hear it all the time. 

Bob: It's like, "I get to work with him."

Bob: It's like, "Megan, Chris, they're amazing. I just have to share this with you." And I'm just like, "Well, tell me." And yeah, that's the whole enchilada.

Bob: And so, yeah, we know that. Right? I wanna hear that story. I wanna know exactly why it was special for you.

Tony: Please tell me all the details, you know, those are those moments that you cherish as an owner of a brand. I think if you can cherish them as an employee of the company, you're ready to own a brand or a company. That's all I have to tell you.

Bob: That's what I think. You're ready... You could build a brand with that person.

Tony: If you embrace that as an employee, if you... If I ever get confused, if I ever say to a small business, any business I'll be like, "Gosh, you're the owner, Bob." And they, "No, actually I'm..."

Bob: That is my favorite thing to do.

Tony: I always go, "You're gonna be one then. You get it."

Bob: I love that.

Tony: "You tricked me. Not a lot of people can pull that off. You're an owner. You just don't know yet."

Bob: And that's a lot of it too, they don't know either, right? They're working in retail. They don't have any aspirations to do anything than I wanna serve people, I wanna help people, I know how to dress. I know how to accessorize. Just like to help people. You're like, "But have you ever thought of the next level?" Just to wrap this up that you're taking your brand in whole ways you didn't even think of two years ago. Because you're thinking like, "Well, what else could we do?" We were just listening to a panel where...outdoor voices.

Tony: Oh, cool.

Bob: The guys comes up with this AR app that his catalog is on the trail as you walk and you're able to see it first if you go on a walk with him at their select stores. And so 1,500 people show up, and they walk through, and they start ordering it. And now people are like asking, "Can you turn onto my trail? Even though I don't live anywhere by you." Well, you know, that's all great, but if you're not like Tony, if you haven't like put that foundation work in, if you haven't gone through and said, "This is who I am. This is who I am. This is who my customer is. A not gonna cheapen my brand because that cheapens the way I think of me and the way I think about what we're doing in the world. That's not me." If you don't have that north star, that's the way I think of it, then dammit, you're gonna everything. And you're gonna follow all the bad things and then you know what you're gonna do? Is you're gonna blame everyone else that it's, "Oh, it's the wrong time," or, you know, "It's online this or online..." You could play in a lot of different ways if you're just willing to open your heart to another human being.

Tony: Absolutely.

Bob: So, I think the things with "Tell Me Something Great About Retail" is meeting guys like Tony and actually understand that feel it, love it, Hammitt. That that's not just the slogan. He's actually got it on the back of his iPhone and again, anything else you wanna leave our thoughts with? Where should they visit you on Facebook or you gotta visit him on Facebook because he's got his live videos which are awesome.

Tony: Yeah. Facebook, Hammitt at Los Angeles. Instagram, @hammittla. I'm @styleprofit, S-T-Y-L-E-P-R-O-F-I-T.

Bob: Oh, you're really? I'm retail doctor, you're style profit?

Tony: Isn't that amazing?

Bob: I love that. We have our little monikers. That's it.

Tony: East meets west.

Bob: I like that.

Tony: Doctors [Crosstalk 00:23:41].

Bob: I like that.

Tony: You know, I'll leave it with this thought. Everything that he you just said resonated with me. If it resonates with you, you're ready to jump into retail. That's it.

Bob: That's perfect. That's great. This is Bob Phibbs, the Retail Doctor and..?

Tony: Tony Drockton, Style Profit.

Bob: Love that. So, turn into another edition and tell your friends because you know what, there's lot of bad stuff we're listing about retail, about business, about it sucks to be us. "Tell Me Something Good About Retail."

Tony: All right.

Bob: I'll see you next time. Thank you so much. Bye.

Tony: Whoo-whoo.

Find out more about Hammitt Bags here 

 

EPISODES:

Episode 101: Tony Drockton, Founder and Chief Cheerleader, Hammit Bags

Episode 102: Brian Travilla, Regional & District Leader Petco

Episode 103: Deanna Renda, Founder, Naples Soap Company

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