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For Minneapolitans the death of the Dayton’s retail brand in 2001 marked the end of the merchant driven department store era. Its roots go back to George Dayton’s naming of the Dayton Dry Goods Co. in 1902. Mr. Dayton did for the upper-Midwest, what W. J. Nordstrom did in Seattle in 1901, what Carson Pirie Scott did for Chicago, in 1903, and what Herbert Marcus Sr., sister Carrie Marcus Neiman, and husband A. L. Neiman did in Dallas in 1907. These, among many others, were America’s preeminent merchant kings. They combined vision, business acuity, and merchandising genius to “fashion the middle class” while becoming near sacred retailing institutions in the cities of their origin.
Much has been written about the downward spiral in the department store category. The decades-long unrelenting acquisitions, homogenization, and commoditization of many of these once great American institutions has been well documented. However, an unforgettable set of circumstances, recently brought it all back into focus.
“Vendor” from Down Under
I had the good fortune to be visited recently by one of modern-day retail’s tech gurus. Vaughan Fergusson is the founder of the New Zealand based VEND, a cloud-based point of sale systems company. Vaughan flew up from Auckland NZ, for meetings related to a foundation he and his partner Zoe recently established. They are turning a 100-acre conference center outside of Auckland into a school-camp to teach kids STEM skills; a monumental undertaking.
Besides launching “Institute for Awesome” and running a $200 million international POS software company, Vaughan is writing a book on retail. And by some quirk of fate, decided to come to Minneapolis to interview me and some local retailers for his book. I was highly honored, to be sure. I suggested that Vaughan spend the night at the newly established Hewing Hotel, in Minneapolis’s North-Loop warehouse district. This warehouse-turned-loft-living area is a new mecca to both Millennials and Boomer empty-nesters. Besides becoming a “foodie haven”, it has spawned some specialized indie retailers; most notably MartinPatrick3.
Modern Day Merchant Kings
For those that have not yet heard of, or experienced MP3 first-hand, it’s quite the phenomenon. In November 2017 Fast Company did a feature, entitled The Future of Retail in the Age of Amazon, written by Austin Carr. He wrote “MartinPatrick3 looks like what would have happened if Willy Wonka had gone to Parsons School of Design”. That works for me.
Suffice it to say, Founder Greg M. Walsh and Dana Swindler, CEO threw away the rule book when they conceived and nurtured what is now a 22,000 square foot store. This emporium of exquisite taste combines the ultimate in men’s fashion, furniture, art, accessories, and interior design services. And don’t expect to find telltale signs of twenty-first century tech. There are no tablet-toting salespeople, or any omnichannel ethos at its core. In fact, they recently even pulled the plug on e-commerce (yep). So, what’s going on here?
What Greg and Dana have pioneered is the embodiment of early 20th century Merchandising (with a capitol M) of the kind that George Dayton, Herbert Marcus Sr. and W. L. Nordstrom founded a century ago. These guys are merchants, in the best sense of the word. They had a clear vision to bring together the highest quality interior furnishings, blended with the world’s finest men’s fashion brands and knit these two worlds together in the most artful way imaginable. In fact, once immersed into the retail experience (a most bona fide application of the term) it is neither a furnishings store with men’s clothing, nor the other way around. It’s retail theater, taken to the ultimate level.
Instructive Meeting
Vaughan and I were fortunate enough to steal both principals away for an hour long sit-down to chat about their retailing phenomenon. And like many before us, attempted to figure out what’s in the secret sauce. We were escorted back to the inner sanctum, past the design studio (with its complete Knoll library, available to only the most exclusive specifiers). As we approached a small lounge-area we were greeted by Cole and Ella, two immaculately groomed standard Poodles. They checked us both out, and I guess we passed.
Once seated, Dana and Greg sketched out the origins and evolution of MP3, which Greg started in 1995 as an upscale interior design studio. Along the way they introduced some men’s accessories which began selling quite successfully. In 2008 they became immersed in building out a full store, which through constant experimentation grew as sales grew. In 2010 they moved into a small portion of their current 133-year-old warehouse building. In the years following, they gradually and methodically annexed sections of the building, introducing new showrooms and galleries. Five such additions have been completed to date.
Their respect for the building’s architecture has been highlighted throughout the renovations. Nothing was forced. The resulting customer “exploration” tends to move the shopper slowly through the store, revealing story after fashionable story. In fact, had the entire 22,000 sq. ft. showroom been conceptualized at once, it is likely that it would not have yielded the same sense of discovery, and serendipity. Our discussions with the principals ran the gamut from culture, to marketing and everything in between. Here is a brief summation.
Clienteling
I elicit the term “clienteling” when describing the nature of MP3’s customer service. It implies building deep, authentic relationships with their clients and customers. If there is a secret sauce (which they both deny) it starts with this. Their sales personnel are expected to know all their clients by name; sans computer. Their customers have come to expect, and receive the highest level of service and respect, complementing the diverse and high-quality men’s fashion offerings.
Going hand in hand with developing a culture of service is, finding capable, engaged “brand ambassadors” who love fashion, and providing personalized service. They’ve accomplished this goal by providing their “family” with a high level of autonomy, empowerment, compensation and “goodies”. It also comes with spending every day with other caring, people persons, surrounded by beautiful things. “Our people love coming to work” was heard more than once.
Curating, by the Square Inch.
I would argue, MP3 embodies the highest level of retail theater anywhere. Literally every inch of this store has been carefully curated. What’s more, all those inches belong to stories that are constantly changing; because that’s what keeps it fresh and dynamic. Furniture, fashion, and found objects are interspersed in ways that produces a level of aesthetic cohesiveness one would expect to find in a museum or art gallery. And yet it never feels intimidating or forced. The shopper becomes a participant in an exploration of visually and texturally tasty stuff.
Eyes on The Ball.
To quote Steve Jobs “deciding what not to do is as important as deciding what to do” and the partners (in both sense of the word) are confronted by “shiny things” almost weekly. Landlords and shopping centers are dying (quite literally) for fresh concepts. Mall of America has offered them the moon to clone MP3 at the megamall; not going to happen! A constant request they get by the females accompanying their many returning customers is “why don’t you expand into women’s fashions?” No thanks, “we know what we know.” The fact that the store has grown 30-40% each of the last four years, gives them every indication that they can continue to grow where they are. Besides, as they suggested “taking on another location would be incredibly hard work. We are having fun doing what we’re doing.”
Growth of the Categories.
When asked about the relative growth of the fashion business versus the interior design and the furnishings business (the 3, in MartinPatrick3), they indicated they all were experiencing steady growth. On the design side they are getting bigger and bigger projects. Greg can keep their core team of eight interior designers very busy with interior design and product specification. Clients see the store, fall in love with the aesthetic and attention to detail, and request that their designers “take over their homes and do it all.” That often entails taking on every aspect of the living environment and lifestyle, including space design, millwork, finishes, furnishings, even dinnerware. The whole story.
Organic Marketing.
Much of MP3’s marketing is organic, much through word of mouth, and in store events. Thanks, in part to the many corporate headquarters in the Twin Cities (Target, Best Buy, General Mills, 3M, Cargill, etc.) many business visitors make it a point to come early or stay over after a HQ meeting to shop MP3. That includes travelers from both coasts (including the Big Apple) and Chicago. And as was the case back in Dayton’s glory days, folks from the Dakotas, and other neighboring states will make an annual pilgrimage to the store. It’s also fair to say that while some traditional advertising is shunned, Dana, Greg and their staff are brilliant at PR. While many Minneapolis retailers got little or no lift from 2018’s Superbowl held a mile away from the store, MP3 had the biggest Saturday in history. Special events timed to the game included a Lululemon “pop-up shop”, a Grey Goose hosted an Ice Bar, and a tail-gate party on Superbowl Sunday in their alley.
What’s next?
We asked if they had any projects up their sleeves. They got a cheeky look as one of them produced a photograph of a two-story boiler-room space, long since abandoned. “We think this could be a pretty neat multi-use space for special events and pop-up shops” volunteered Dana. He further suggested that a portion of the two-story space (still containing the mammoth boiler) might be pretty cool with a glass-floored mezzanine. Agreed, that sounds cool. And, I guarantee the boiler will be featured like none-other in the Twin Cities.
