Martha, Macy’s and definitions

Posted by Marty Brochstein on February 03, 2012

As many of you know, I spent most of my professional life as a business reporter and editor, covering such industries as consumer electronics, retail and, oh yes, licensing. One of the things that is drummed into any reporter (or should be) is the need for clarity in all phases of the editorial process — from asking precise questions, to making sure that the answer you get is clear, to communicating the story in an understandable way.

One of the great lessons that I learned over the years is to not let interviewees use vague generalities in describing the retail business. There has always been (and continues to be) the inevitable point in a conversation when somebody uses a term such as “department store” or “mid-tier” and I reflexively say: “Such as? Give me an example. ”

It’s far from a superfluous question, though some get annoyed at having to explain such an “obvious” term that “everyone knows.” But I always want to make sure that we’re using a common vocabulary. Vocabulary is an ever-changing tool, where the meanings of words morph on a regular basis. Go back a few years, and there was a retail tier that many referred to as “National Department Stores” that consisted of Sears, JC Penney and Montgomery Ward.” If somebody, in describing his distribution strategy, used the term “department store,” and I asked whether that included Penney, sometimes the answer was yes, sometimes no.

The tier now known as “mass” included “Discounters” and a subset known as “Upscale Discounters.” The term mid-tier hadn’t been invented yet. Is Toys R Us specialty or mass? What’s Bed, Bath & Beyond? When somebody asks how much of your business is done online, does the answer you give include the websites of bricks-and-mortar stores, or just online-only businesses?

I’ve been thinking about that a lot this morning as I read press coverage of the dispute between Macy’s and Martha Stewart Living Omnimedia (MSLO) over the latter’s deal with JC Penney that would see Martha’s licensed good sold in Penney’s restrategized stores.
According to reporting I’ve seen on arguments and documents filed so far, an extremely important point of contention is the definition the terms under which the Martha Stewart goods would be presented and sold in JC Penney, and whether that infringes on exclusivity definitions in MSLO’s agreements with Macy’s.

“The issue… is the contract says that Martha Stewart, which has a standing agreement with Macy’s, can sell goods in MSLO, Martha Stewart Living Omnimedia, stores, and we are creating Martha Stewart Living Omnimedia stores inside of J.C. Penney,” said JCP attorney Eric Seiler in court this week, as reported by WWD. “We have the absolute right to sell whatever we want in MSLO stores.”

Ah, that old question of definitions. What’s a “store?” Is a shop-in-shop in a JC Penney store the same as an “MSLO store.” What’s a “shop-in-shop” anyway? Is the term defined in any contracts?

Or is just one of those terms that “everyone knows”?

(I highly recommend that you sign up at www.licensing.com for the free LIMA SmartBrief daily news aggregation that regularly includes stories about the Penney transformation and the Macy’s-Martha face-off, among other licensing, marketing and branding topics.)