Tuesday, September 11, 2007

1907: Neiman Marcus opens for business

When Herbert Marcus, his sister Carrie Marcus Neiman, and her husband, A.L. ("Al") Neiman, opened a store in downtown Dallas on Sept. 10, 1907, they had one goal in mind: bring luxury to Texas.

During a two-year stint in Atlanta, the three partners did promotional work for Coca-Cola that netted them the $25,000 used to open the store. Their refusal of a Coca-Cola franchise in lieu of payment is still a source of familial chuckling. "They weren't going to be taken in by this novelty drink," says Lawrence Marcus, 90, Herbert Marcus' last surviving child. "They wanted cash."

The store idea was refined by Lawrence's brother, Stanley, who started working at the store a year after it opened. He was eight.

"Mr. Stanley," as he became known — distinguishing him from other brothers around the store — created an aura unheard of then in retailing. The store gave fashion awards to Coco Chanel and Grace Kelly, developed over-the-top "His and Hers" Christmas gifts (including expensive cars and airplanes) and instilled the notion that the customer is always right.

"If you sell satisfaction, people will come back to you," Stanley said.

Elyse Lanier, the wife of former Houston Mayor Bob Lanier, remembers Stanley Marcus well. While a student at the University of Houston in the 1960s, she worked part-time at the Houston store, then located downtown. (It moved to the then-distant suburban Galleria location in 1969.) Whenever Mr. Stanley visited, she snuck into the couture department to hear his staff pep talks. "I would hang onto his every word because so much of what he said applied to life," Lanier recalled.

She also learned a valuable lesson about sales. When Houston Symphony conductor Andre Previn came into the store looking for a scarf, she first showed him all the scarves she liked. "He hated every one," she recalled. "So I showed him every scarf I hated, and he bought all of them."

Marcus once said he doubted the store's remarkable success could have happened anywhere but Texas, where the oil business created instant millionaires with the hunger for luxury goods. He aimed to raise the taste level of the new rich. He delighted in telling the story of a girl in a cotton smock who came in straight off the farm and spent $10,000 to outfit herself, including shoes for her bare feet, because Daddy had just struck oil.

Dallas fashion executive Bud Knight reports that during his tenure as the store's coat buyer, women asked to have their Neiman Marcus labels sewn in upside down so when they placed their coats on their chairs, people across the room could read them.

The most famous burlesque star of the Depression, "Fan Dancer" Sally Rand, was no shy customer. "Sally was appearing at the State Fair," says Lawrence Marcus. "She had these fans that she would pass in front of her body in misty light, and you sat on the edge of your seat hoping you'd see some of her treasure." In a store dressing room, she breezily showed Stanley Marcus all of her "treasure" as she tried on dresses, standing naked "without her fans," he says. "It was my wildest dream come true."

The burlesque arts found Neiman's again when Bing Crosby and the Andrews Sisters had a hit with "Pistol Packin' Mama." A lingerie buyer ordered a shipment of garters equipped with toy pistols. When Stanley Marcus saw the garters, he said, "Burn them."

Robert Sakowitz, whose family's store went head to head against Neiman Marcus from the mid-1950s until 1990, said the Dallas location was a big boost.

"The whole city is known as a marketing city compared to Houston, which is a production city," Sakowitz said. "Dallas was an extremely proud supporter (of Neiman Marcus). It worked to their advantage to a great degree. Stanley was brilliant in his marketing of the city along with his store."

Even after Neiman Marcus merged with Carter Hawley Hale in 1969 and was acquired by Boston-based General Cinema in 1987, its headquarters remained in Dallas. The new owners provided financing for expansion. Neiman's opened its first store outside Texas in Bal Harbor, Fla., in 1971; there are now 39 across the US. But its corporate owners had the good sense to leave the stores alone, letting Marcus and his brothers work their magic. Marcus retired in 1975 but remained as a consultant until his death in 2002. The company went private in 2005.

While many retailers believe New York is the center of the fashion universe, staying put in Dallas gave Neiman Marcus a strong sense of place and helped the retailer retain its focus.

"So many other retailers blow with the shifting wind. They clearly communicated a taste level and point of view," said David Wolfe, creative director for the Doneger Group, a New York-based fashion-trend-forecasting firm.

Wolfe believes staying in Dallas gave the luxury retailer a terrific mystique and identity. "There's something to be said for someone who sticks to their guns — especially in fashion, which by its very definition is changeable."

The store has always championed new designers, but it has never veered to the outer fringes of fashion. "The idea of being half a heartbeat ahead of fashion is the perfect pace," Wolfe said. "They never went so far to the cutting edge that they frightened their customer. They have always understood the whole point of fashion is to make a woman beautiful."

Dallas investor Pat Patterson was a newly minted Smith graduate in Neiman's customer relations when she got a 7:30 a.m. phone call from the loading dock. "Miss Patterson, could you please tell me what to do with this baby elephant?" the voice asked. "Mr. Stanley [Marcus] had ordered it for the Far East Fortnight and it arrived six months late," Patterson says. "We called the zoo."

As president and later chairman, Stanley Marcus burnished the store's reputation of meeting any request. But when an elderly woman wrote asking Neiman's to find her a man, Mr. Stanley demurred. "The risk to us is too great, particularly when you specify that you're looking for a companion between 70 and 75 who is completely and absolutely finished with sex," he wrote. "Frankly, I wouldn't know where or how to search for such a man, nor do I think I would believe him if I found him, nor would I recommend that you put too much faith in any man who claims to answer your specifications."

Because of its top-of-the-line merchandise, the store is known as "Needless Markup" in some circles. But you rarely hear that complaint from well-heeled, regular customers. A Neiman Marcus box or shopping bag signals that they have arrived.

"(Neiman Marcus) understood the aspirations of the American dream, and they sought to define it materially. So if you have an aspiration to be wealthy, this is what you would wear, this is what up would have, this is what is good taste," Sakowitz said.

He said Neiman Marcus Group Inc. president and CEO Burt Tansky once proudly told him that the store no longer carried any men's suit that cost less than $1,000. "I remember thinking what an extraordinarily gutsy thing that was. But, in point of fact, it had become such a small percentage of their business anyway, it didn't make a difference," Sakowitz recalled. "It takes that kind of conviction to be at the absolute pinnacle."

All four of the Marcus sons, Herbert Jr., Stanley, Edward and Lawrence, worked at the store with varying specialties. Stanley was the retailing prodigy. Herbert Jr. opened the men's area, while Lawrence ran women's apparel and ladies shoes. Edward was the most adept with numbers.

"Eddie went to Harvard for a few months and learned to play bridge," says Lawrence affectionately, "and was not asked back... Then he went to the University of Texas and taught bridge and was not asked back... Then he came back to the store. He was very, very good with figures."

Stanley proved to be the family Nostradamus. In a 1966 speech at Indiana University, he predicted something he called "phonovision."

"The mass use of color phonovision will introduce a completely new dimension to remote buying and selling," he said. Customers will be able to "see the articles over the monitor that will interest them right in the comfort of their own living rooms."

Today, neimanmarcus.com has larger sales than any of Neiman's brick-and-mortar stores.

To commemorate its 100th anniversary, Neiman Marcus is featuring a wide array of special limited edition merchandise — including clothing, jewelry and more, from major designers.

Yesterday, shoppers received free samples of the store's famous chocolate chip cookies. Legend has it that a shopper who once asked for the recipe was told it would cost "three ninety-five." He charged to his bill, thinking they meant $3.95. When the bill came for $395, he published the recipe out of spite.

Officials insist the story has no merit and are serving the cookies as a playful riff on the urban myth. The recipe is available for free on the Neiman Marcus Website.

All 39 stores are also asking customers to bring in treasured pieces of Neiman Marcus memorabilia on Wednesday from 11 a.m.-3 p.m. The entries will be photographed and forwarded to Dallas for final judging. One lucky winner will receive 1 million points in the store's customer-loyalty program. (info from the Houston Chronicle & Dallas Morning News)

Although your humble editor's full name is Michael Neuman Marcus, he is not related to the store's founders. Darn!

No comments: