Friday, August 24, 2007

Overheard: What does urban mean, anyhow?

This week’s Overhead features Shoe Carnival (SCVL) CEO Mark Lemond, and Clifton Sifford, Executive Vice President, General Merchandising Manager. Basically, Shoe Carnival is a discount shoe retailer like DSW or Payless. They generated $682 million in fiscal 2007 revenue. As usual, all Overheard quotes are being pulled from the investor conference call transcripts over at Seeking Alpha.

We decided to take a look at Shoe Carnival because of their focus on race and their consumers. After all, Mark Lemond is willing to say things like, “We're still looking at income, you know, the lower to moderate income levels as really our core consumer, and try to merchandise around the ethnicity of that core consumer.” He’s honest, right?

In fact, they break down their stores between urban and suburban. What’s interesting, however, is that it does not appear that a commonly recognized measure like, say, population density, determines the urban or suburban nature of the store. In response to a question from Jill Caruthers of the New Orleans-based investment bank, Johnson Rice, about the urban/suburban split, Clifton Sifford responded:

Clifton Sifford - EVP, General Merchandising Manager: Jill, this is Cliff. We have -- out of the 284 stores that we operate today, 179 of them were what we consider to be urban. What turns a store urban in our opinion is at least 30% or more of the traffic that walks into the door is urban. It's because every store that we operate has an urban influence, it's almost impossible to tell you what our suburban business would be minus that.
Jill Caruthers - Johnson Rice:
Okay.
CS:
Does that make sense?
JC:
Yes. So I -- okay. All right. Thank you.

Wait. 30% or more of the traffic is urban? Wouldn’t all traffic in a city be considered urban? Every store has an urban influence? No, it actually doesn’t make sense, Cliff. At least not unless you choose a pretty unconventional definition of urban.

We can look for guidance about the language from Mark Lemond, “Our urban consumer, both African-American and Hispanic, is not shopping as they have in previous seasons.” You know, the urban Hispanics of the central valley of California or the fields of Oklahoma. The urban African-Americans of the farms of Georgia.

I wonder if Japanese people are counted in the suburban or urban stores. How about Chinese people? Vietnamese? Palestinians? At least they count all white people as suburban, which everyone knows is code for uncool, or at least, tapered.

A final question: would it be better if they labeled their stores, Black, Hispanic, White? It’s actually a serious question. Could occluding the racial categories that are clearly operative be a good thing? Or not.

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