Yahoo Finance EXCLUSIVE: A Smaller, Revived Century 21 Talks One Year Back in Business
Century 21 remains a New York City fixture, despite all its ups and downs.
Next Thursday marks the first anniversary of the storied off-pricer’s return to business with a single site at 22 Cortlandt Street — its original flagship situated in Manhattan’s financial district.
More from WWD
Tom and Ruth Chapman on What Went Wrong at Matches and Luxury E-commerce 2.0
How Jordan Brand Streetwear Designer Aleali May Plans to Disrupt Sustainable Fine Jewelry
“It’s really been a year of relearning retailing and relearning New York City, but we are definitely optimistic,” said Larry Mentzer, the chief operating officer of Century 21. “Our roots go back to 1961 in New York where our brand grew up. New York is where see our past and our future.”
The Century 21 flagship was destroyed during the terrorist attack on the World Trade Center on Sept. 11, 2001. It was rebuilt but forced to close in September 2020, along with the off-pricer’s 12 other stores, when the business went bankrupt claiming its insurance wrongly failed to cover the loss of revenues due to the pandemic. Other retailers were also pushed into bankruptcy by the pandemic, but Century 21’s filing came as a surprise considering how consistently popular and productive the off-pricer had been, particularly in lower Manhattan.
But since reopening a year ago, “We hear from our customers daily that Century 21 is not what it used to be and they’re actually right. It’s better,” Mentzer said in an exclusive interview with WWD.
In the following Q&A, Mentzer details how Century 21 has evolved in the year since it reopened, how it differentiates from competitors and what the future holds for the famed retailer.
WWD: What’s new and different about your remade flagship?
Larry Mentzer: “While we are in the same location, the footprint is not quite half the size. It’s about 100,000 square feet, gross, with approximately 70,000 square feet selling over four floors. We don’t carry some of the categories we had in the past, specifically a lot of the home categories, children’s shoes and lingerie. We don’t carry full beauty any longer. But what we’ve really tried to do is modernize the brand in terms of what we bring to the customer.
WWD: How does Century 21 differentiate?
L.M.: Designer brands at amazing prices is the white space we fill and which makes Century 21 different than the other off-price guys kind of in our lane. We watch the more moderately priced off-price players, but we really look toward what Saks Off 5th and Nordstrom Rack are doing and try to fill (the space) we don’t think they fill — an ever-changing assortment of real designer merchandise. We don’t make any private label. Our buyers are out every day looking for the best deals on the best brands we know our customer wants and can’t find at other stores, off-price, aside from maybe an occasional sample sale.
You’re not going to find the amount of Versace or Balmain or some of the other great designers we have at these prices anyplace else. We’re constantly curating. Our business can be dramatically different in two weeks. We can have a totally different assortment before the end of the month, which is what some of these bigger guys really can’t do. They’re not as nimble as us. We’re so liquid, and we are turning so fast. What you see in the store today, by Tuesday of next week, it won’t be totally different but it will be dramatically different.
We get new arrivals every day, Monday through Friday, one to two trucks. Thousands of new units come in every day. You don’t see that at some of the bigger retailers, whether their full-line or off-price. And the fact that we’re in New York, we can (readily) get into the showrooms. We’ve got great relationships with our vendors from the old Century 21 as well as new vendors that can quickly pump new goods into our store. It brings newness to the customer because at the end of the day, that’s what she’s looking for — something new, something different and something at an amazing price. We check all those boxes.”
WWD: Century 21 recently staged a “Deal of the Century” event with Moschino. What’s that format all about?
L.M.: We work with some of our vendors to bring in an expanded assortment from them. So with Moschino it was women’s apparel, men’s apparel, footwear, accessories pulled together under the headline, “Deal of the Century,” and we dropped it right on the main floor and used social media and our partner ShopShops (the online livestreaming shopping app) to market the event.
WWD: What are some top brands you might find at Century 21?
L.M.: In addition to Moschino, there’s Burberry, Bottega Veneta, Dolce & Gabbana, Zegna, Balmain. Also, our merchant team has been working to go after the contemporary business, brands that you don’t normally see off-price like Reformation, Rag & Bone, All Saints, Ted Baker, John Varvatos.
WWD: What’s your pricing like?
L.M.: From a marketing point of view, it’s up to 65 percent off, 100 percent of the time. Some deals are even better. The Moschino Deal of the Century was marketed at up to 90 percent off.
WWD: How is Century 21 performing?
L.M.: We are doing OK. New York is not what it was in 2019. Traffic is different. The customer is different. Tourism is different. You don’t see that rush in the morning, with hybrid work schedules and less people coming to the office, specifically in the financial district, Monday through Friday. But we’re optimistic and learning a new way to survive in New York City and prosper in the retail sector.
WWD: Is the smaller flagship more productive than the previous flagship?
L.M.: From a dollars-per-square-foot point of view, it is not. But again, the assortment is so different. We’re not comparing apples to apples. At the old Century 21 we had full beauty, with vendor installations on the main floor. We had a huge tie department. Now I don’t know when the last time I saw someone wear a tie. People shopped and dressed differently.
WWD: Wasn’t beauty regular-priced, and not off-price?
L.M.: From the vendors’ point of view, it was full price. From Century’s point of view we offered you a bounce-back coupon to bring it under the off-price umbrella. Basically, the more you spent, there was a bounce-back offer to the customer on full price.
We are going after beauty in a different way, not with vendor-installed counters. We don’t think customers are coming to us for beauty per se, traditional beauty. We do offer pickup items. Every time you come into the store there are beauty and skin care items that are more like grab and go. Like our apparel offering, it’s an ever-changing beauty offering. There’s color treatment, skin care, hair care and all the accessories that go along with those, whether it’s brushes, hair dryers, curling irons. We believe beauty is an opportunity for us but not in the way we did it in the past.
WWD: On the operating side, what other changes have been made over the past year?
L.M.: We’ve expanded our store hours based on consumer feedback. When we first opened, (store hours) were 10 to 6. Then we went to 10 to 7. And now we are 9 to 9. We are definitely seeing more people on the street in the morning, and as it stays lighter later, we’re seeing more people out and about after 6 o’clock at night. Quite honestly, we’re doing a healthy business between 6 and 8:30 p.m. on Thursdays, Fridays and Saturdays when we’re open until 9 at night.
WWD: What’s the situation with tourists? Century always had a sizable out-of-town following.
L.M.: We’re working with New York City Tourism and Conventions to understand who’s coming to New York. We’re not a store for tourists. We’re a store for locals. We believe we are the largest store below Canal Street both in terms of footprint and volume, the neighborhood store in the financial district. That’s what we want to be and that’s what we were before. But we also know a lot of tourists come to Century 21. So we’re working with the Downtown Alliance and the New York City Tourism and Conventions to understand where tourists are coming from. How long are they staying? And how do we get our fair share of tourism dollars being left in New York. A lot of folks visiting New York are more about experiences — sporting events, music events, cultural events, eating out. Retail is not at the top of the list as it had been in the past.
We’re gearing our attention on hyper-locals, people who live in Jersey City, lower Manhattan, probably below Canal Street, and downtown Brooklyn, and on day-trippers, which are people who come in and go out of the city. Then there’s the gatekeepers, people in northern New Jersey, Westchester, upper Manhattan, Queens, Nassau County, even Staten Island, people who come into the city for work or play periodically. It’s where they work, where they go for entertainment and restaurants. They’re also very comfortable coming in and out of the city, but it’s a commute. Everyone else is really a tourist.
WWD: What about opening a second store, to reach more shoppers?
L.M.: We are eager to get more stores open within the New York City area. As I said, New York City is where we’re from. We lean into that. Our stores flourished here, up until COVID. And we believe there is room in the retail marketplace in New York City for at least another Century 21 if not more, in the near future.…We’re always talking to people and looking at space, but we’re not actively talking to anyone about a Century 21 in the next 12 months.
We ran large footprints in the past. The right-size store for us is probably somewhere between 50,000 and 80,000 square feet, not the 120,000- to 150,000-square-foot boxes we ran in the past. It’s a new world in retail and having those big footprints aren’t really what the customer is looking for. You see a lot of retailers now looking for smaller store formats. We were on that path anyway, back in 2019. We were opening up a prototype store in Staten Island pre-COVID that never opened. But shrinking the footprint, making it easier to shop, creating a frictionless environment for the customer, all those things are important today, and that’s hard to do.
WWD: Are you considering e-commerce?
L.M.: It was our intent to launch as an omni-retailer last year — the store and the website at the same time. We had a variety of challenges, really about the logistics, that forced us to put the website on the back burner. We do intend at some point to get back into the e-commerce business.…We’re working with a 3PL (third-partly logistics firm) called Dynamic out of New Jersey. So part of our agreement with Dynamic is that they will do our warehousing as well as our pick, packing and shipping for the website when it launches. We had a different 3Pl before. The IT component, and the digital nature of e-commerce, provided a lot of challenges as to whether all of our partners were able to interface with each other to create a seamless experience for our customer, the whole thrill of the hunt. In the past, we did it all in-house. Our systems were in-house; we owned and operated our own warehouses. We’re using partners now because we believe that’s the right way to relaunch Century 21.
We’re not yet able to bring the full website back to the customer, meaning Century21stores.com. But are working with ShopShops on a super-curated online assortment that is similar to e-commerce, but I’ll just call it digital revenue. It’s not a website per se. It’s done off of their app where we will also feature a super-curated, tight assortment, and again, amazing deals from Century 21. We’re also working with ShopShops on a TikTok store.
Now we’re working with some other partners to try to generate some digital revenue and bring at least a piece of the store to the customer who can’t get downtown. ShopShops are in the store three or four times a week. They have different on-air hosts who have big followings. To be able to get anywhere between 2,000 and 4,000 people to watch a streaming show from Century 21 about sunglasses, that’s pretty good. So there’s a great marketing halo effect to this. It brings the brand to people outside of the financial district and outside of New York City.
WWD: What’s your position on pre-owned merchandise?
L.M.: We try to meet the needs and wants of our customers and our customers have told us that it’s important to them. So we are in that business through a partner, Two Authenticators. They do all of the authentication and the price setting. Probably 95 percent (of the assortment) is handbags, on occasion there’s some accessories and jewelry. The merchandise rolls in and out and probably changes every 90 days. There’s a good assortment. It’s a lot of Louis Vuitton. We do have Chanel handbags.
WWD: Company-wide, what’s been selling best?
L.M.: Our men’s business is good across the board, whether it’s the contemporary brands, the designer, or the traditional brands, it is good from one end to the other. Century 21 historically had been a destination for men’s apparel. It was on the main floor and the second floor at the old Century 21. It’s on the third floor today. Definitely it’s different.…(However) we’re seeing great growth in men’s.
The same is true in women’s apparel. We’ve been thrilled with our business in true designer. It’s probably about 8,000 to 10,000 square feet of a constantly changing amazing designer assortment. The designer business is very healthy. We’re definitely going after women’s contemporary. We see growth there. We see growth in active. And we are planning on reopening our lingerie department in the fall of 2024. It will be right off the the women’s floor so the adjacency is great.
We’re using data to make decisions, and gathering feedback from the customers about what’s missing. From day one, she expected to find a lingerie department at Century 21.
WWD: What’s your outlook on the business?
L.M.: We’re not seeing the traffic that we saw in Q3 of 2023. So it’s definitely been different January, February and March. But I can tell you post-Easter, we’ve definitely seen it, you know, which would be the end of fiscal Q1. It’s improving, every day is better than yesterday. We’re getting some traction and traffic is picking up and sales are picking up. So I don’t know if that’s a function of it getting lighter, but I don’t have a last year to base it on; it’s difficult to tell.
Best of WWD
