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Stewart's high-profile retailing strategy may doom her brand

Published: March 25, 2004

By JACQUELINE GHOSEN
Reporter Contributor

Martha Stewart's hands-on, high-profile retailing formula—once the key to her unprecedented success—may be her brand's death sentence as the possibility of prison looms in her future, according to a retail-marketing expert in the School of Management.

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"Rarely do you see designers out there touting their products and showing us how to use them," says Arun K. Jain, professor and chair of the Department of Marketing. "That sort of work usually is done by beautiful models and is why the Versace line still has cachet even though he is gone, and Chanel still has Chanel's imprint though few have seen Coco Chanel."

"Martha was selling herself; Versace sold the products," says Jain. "Martha's brand benefited tremendously from her image as a style diva and her uncanny ability to promote it through her TV program and magazines."

With Martha Stewart the domestic diva gone missing from TV—replaced by news accounts of her criminal lapse in judgment—the Martha Stewart brand may collapse into a void, no longer propped up by Stewart's diva status, Jain contends.

"With Martha gone, the gloss will be tarnished and opportunity for product promotion obviously diminished," he says.

Die-hard supporters may continue to buy Stewart's products, but Jain questions whether in the long run even these supporters will stay at her side, given the fickleness of the fashion-buying public.

"No matter what her supporters may say, Martha will not be hosting a show from prison," Jain says. "Nor will she possess the same authority to write a column about what mainstream America should be serving for Thanksgiving."

As far as Kmart's relationship with Stewart, Jain says the slumping retailer may have no other option but to ride out Stewart's predicament, hoping her brand has some staying power, at least through the holidays.

"Given its poor performance, Kmart is not in a great position to dictate much to Martha Stewart Enterprise," Jain says. "If I were sitting in the CEO's chair, I would not be a very optimistic. This is the last thing Kmart needed."