Century 21 Stores’ CMO to Drive Innovation
The off-pricer is testing a small store concept in two locations.
Century 21 Stores has a growing appetite to test new merchandise and service concepts.
That’s the word from the off-price chain’s new chief marketing officer, Michael Kustermann, who has a strong background in the coffee business and innovating the customer experience, having worked at Starbucks and Nespresso.
“The off-price sector is a part of the market that has a lot of opportunity still — a lot of white space,” Kustermann told WWD. And Century 21’s big base of loyal shoppers “gives us a green light to test different concepts, whether that manifests in the brands we sell or how we communicate,” to customers, Kustermann added.
The retailer is testing a small store concept called Century 21 Edition. Two are operating, in the Roosevelt Field Mall in Garden City, N.Y., and the Staten Island Mall in Staten Island. “The initial response has been very good,” Kustermann said. “We are excited to offer a smaller, curated assortment. The mission is to see what the customer experience feels like with different categories.”
Century 21 Edition sells handbags, shoes, fragrances and eyewear as well as vintage designer handbags through a collaboration with LXR & Co., which specializes in vintage handbags and accessories from designer brands including Hermès, Chanel and Louis Vuitton.
The Edition format introduced the company’s first optical departments, which offer free eye exams. Asked if other services not typically seen in the off-price setting might be tested, Kustermann replied, “I wouldn’t say no to that. There is a changing customer expectation that shopping includes more experiences and services. We are trying to provide experiences that help our customers live better.”
On the company’s e-commerce business, Kustermann said Century 21 has a “tremendous amount of runway to grow it from a dollar standpoint and a customer base standpoint.” Century 21 Stores, a private company distinguished by its high penetration of designer fashion and accessories at up to 65 percent off, does not disclose sales of its brick-and-mortar and e-commerce operations. Kustermann did acknowledge that operating an off-price e- commerce business is challenging, with a different planning cycle from traditional retail. “Keeping newness and relevance and allowing things to turn quickly, that is a challenge within off-price,” he said.
The position of chief marketing officer is a new one at the company. Kustermann will be leading all marketing, creative and digital efforts, including e- commerce. He reports to Century 21 Stores co- chief executive officer Raymond Gindi and is a member of the executive committee.
Kustermann last worked with the Bose Corp., the high-end audio equipment company, as global chief digital experience officer for about a year and a half. Earlier, he worked at Starbucks for more than four years as director of global innovation, leading efforts to identify and create new products, services and partnerships for international markets.
However, Kustermann considers working at Nespresso, a unit of the Nestlé Group, from 2003 to 2010 as “the formative part of my career.” He was a senior leader and ultimately assumed responsibilities for trade marketing, sales and retail development.
“When I started my career at Nespresso in 2003, it was a very small company. When I left it was a $4 billion company,” said Kustermann. “The common thread throughout my career is, what do we do to keep the customer experience exciting and knowing that the customer always comes first.”
Gindi said Kustermann is joining Century 21 Stores “at such a pivotal time during our organization’s growth and expansion. He has a consistent track record of driving sales, loyalty and marketing effectiveness through the customer- centric approach.”
He cited Kustermann’s expertise in innovation, customer experience and omnichannel marketing as “critical to the future growth and success of Century 21 in the ever- changing retail climate.” Century has been steadily expanding, in recent years opening in downtown Brooklyn and Florida as well as launching pop-ups and Century 21 Edition.