Consumer jury still out
Retailers say Martha Stewart sales holding up, so far
By Clint Engel -- Furniture Today, March 14, 2004
High Point — High Point— Martha Stewart was convicted on securities-related charges this month, but key furniture retailers say the real jury — the buying public — is still out.
It's too early to say whether the domestic diva's woes will hurt sales of her furniture line with Bernhardt. Some retailers are concerned, but most say the early signs are favorable. Sales of Martha Stewart Signature Furniture by Bernhardt held up at retail throughout her trial and in the first weekend after her conviction.
Although some retail and branding experts predict the Stewart brand is a goner, retailers say they haven't heard that from consumers. While stores aren't going out of their way to advertise Stewart's name right now, they're not changing their game plans just yet.
"It's a concern for the future, but right now (the furniture) is doing fine," said Barry Tatelman, CEO of Avon, Mass.-based Jordan's Furniture, which shows Stewart's furniture in all its Boston-area stores. Jordan's even aired funny TV commercials with Stewart last year to launch the line.
"Obviously, it's a concern for everybody. Her name is certainly tarnished, that's for sure," said Tatelman. "I'm not going to market (the name) right now. That's just asking for trouble."
But that's not an unusual practice for Jordan's, which only ran the Stewart commercials for eight weeks to introduce the line.
"The furniture stands on its own," Tatelman said. "It's the furniture we're selling — it's not necessarily Martha Stewart — and it's well-designed and well-priced."
Indianapolis-based Kittle's pulled the Stewart line from its smaller-community stores because it wasn't doing well there — but that move had nothing to do with the verdict, said CEO John Durkott. In fact, the product has been a hit at the Castleton, Ind., superstore and Columbus, Ohio, stores, generating more than $300 per square foot.
But like other retailers, Kittle's is adjusting its ads. A recent direct-mail circular had a "Think Spring" theme with sections such as "Think Leather" and "Think Upholstery." There was going to be a "Think Martha" page but Durkott thought twice and changed it to "Think Fashion."
Lancaster, Pa.-based Breuners Home Furnishings Corp. carries the Bernhardt line in about half its Huffman Koos, Breuners and Good's Furniture stores. "We haven't seen anything yet that would cause us major concern," said CEO Joe Reddington. "We'll continue to monitor it."
His educated guess is that since the controversy came to light in January 2002, most consumers already have made up their minds about whether or not they like Stewart.
"Frankly, we don't expect (a consumer backlash) but you just never know," he said.
Coconut Creek, Fla.-based Carls is "dedicated to the product because we're doing so well with it," said President Fred Friedman. In the past eight weeks, while Stewart was on trial, business from the line actually increased. A few consumers told the retailer they think Stewart "might have gotten a raw deal," he said.
"I'm more encouraged every day by the feedback and reaction I'm getting," said Alex Bernhardt Sr., chairman and CEO of Bernhardt, which launched the licensed collection with Stewart in fall 2002. Although he's not happy with "this turn of events" for Stewart — whom he knows personally as well as professionally — "I don't see any significant harm being done to our furniture program whatsoever."
After the verdict, Bernhardt quickly issued a statement saying it will continue to support the furniture program, now offered in over 250 galleries nationwide.
"We believe that consumers have learned to differentiate between occurrences in the personal lives of celebrities as compared to products that offer consumers good solutions for their own uses," Bernhardt said.
Asked if new retailers would still want to take on the line despite the legal baggage of its namesake, he said: "Great product is the simplest thing I can tell you. And some retailers are predisposed to gallery presentations like that."
The Martha Stewart retail presentation includes prepackaged formats with correlating paint colors, floor coverings and fabrics. The furniture also has another brand behind it — Bernhardt — with a 114-year history "that's pretty well thought of," he said.
Gabberts CEO Jim Gabbert said he plans to add Stewart's latest collection, Turkey Hill, while awaiting the consumer verdict.
"We're getting the new collection, and we're going to present it with conviction, and we believe it will sell very well because it is well-styled, well-priced furniture," Gabbert said.
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