Christopher & Banks charts turnaround after losing its way

As she zipped around the Christopher & Banks store at the Mall of America, LuAnn Via candidly pointed out the many ways the retailer had lost its way before she arrived.

It added too many styles, but then didn't have enough depth in sizes.

Its clothes became too modern and devoid of color — then it went the other extreme and went color-crazy.

"We went what I call ditch to ditch," said Via, who has been leading an impressive turnaround at the Plymouth-based retailer since she became its CEO at the end of 2012. "Then everything was purple, pink, aqua. The store looked like an Easter egg."

Now under Via's leadership, the company that sells moderately priced clothes to middle-aged women has been finding more of a middle ground that respects its customers' love of pink intermixed with black and white. The goal is to give customers an updated look without scaring them off by being too trendy.

"Our customer is not fashion-forward," Via said. "She's not a fashion leader. But she is a fashion follower and she likes to be relevant. She wants to know someone else is wearing it."

Via brought prices back down after they were raised 25 percent in 2011. She revived core categories the company mostly walked away from such as pants and denim.

And she added new items such as wrinkle-free shirts.

It seems to be working. Christopher & Banks, which floundered in the years coming out of the Great Recession, has begun to finally show some momentum. The retailer reported its first profitable year in the last fiscal year following three years of losses.

Its stock has begun to recover, too. While it traded as high as $29.48 in 2006, it plummeted to a low of $1.03 in 2012. On Friday, shares closed at $9.53.

"They've done a good job of re-establishing dependability for the consumer," said Neely Tamminga, an analyst with Piper Jaffray in Minneapolis.

Some of the groundwork for the turnaround was laid out before Via arrived. In 2012, the firm closed about 100 underperforming stores that were often in not very desirable locations.

Now a major focus of the business is combining its plus-size stores, which were launched under the CJ Banks brand in 2000, with its missy and petite stores under the Christopher & Banks name.

After showing some initial positive results, the retailer has been accelerating its plans to convert more stores and open new locations in the format referred to internally as MPW stores (missy, petite, women). It plans to have 190 of its 545 stores in this format by the end of the year. By 2018, Via hopes to have mostly phased out stand-alone CJ Banks stores.

The inspiration behind the push stems from the fact that the average American woman is a size 14 and so sits right on the cusp of being a plus size, Via said.

"And a lot of women wear a different size on the top of the bottom," she said, noting that they may be a 12 on the top, but a 14 or 16 on the bottom.

And Christopher & Banks found that about 20 to 25 percent of its customers cross shop between the two stores, which were sometimes located on opposite sides of the same mall or in different centers altogether.

"The brilliance of the MPW strategy is first and foremost that it was tested," Tamminga said. "Second, it speaks about authenticity. In a world of frictionless commerce where you can be served at your fingertips, it's important that selection can be found in the store."

In the next month or so, Christopher & Banks will unveil a merged website for both brands. Currently, customers have to make separate transactions to buy items.

The blending of the two brands has also included uniting the merchandising teams, which previously were separate. In the past, Via said, the approach was to buy different clothes for the plus-sized customer. And those clothes, frankly, were a bit frumpy.

"The customer that is a plus doesn't want special-made fat clothes," Via said. "She wants to wear the same thing her friend is wearing."

So now the selection is pretty similar across the missy and plus-sized spectrum with some nuances in sleeve length or cut depending on the size.

As it retools its business, Christopher & Banks is hoping to draw more customers from the bankrupt Coldwater Creek, which recently shuttered its 385 stores across the country. The two retailers were in about 100 of the same shopping centers. So now Christopher & Banks has been sending some promotions through direct mail to target customers.

But Christopher & Banks still has a number of challenges — for one, traffic in its stores has been dropping. But Via noted that it's happening across retail. So the key is to clinch more sales from the shoppers who do come in the door. And that's what it's been doing by offering better merchandise that customers are more willing to buy for regular price.

As it has made a big push in denim and pants, Christopher & Banks has been standardizing the fits — curvy or classic, for example — and color-coding them on tags.

In order to get there, Via has become more of a stickler on sourcing, requiring that merchants use its own size parameters. If they don't, she sends the orders back.

But throughout it all, Via is staying laser focused on its core customer, who is 45 to 60 years old and still includes many teachers, nurses and administrative assistants. Many other retailers have walked away from this customer in an effort to be more young and hip.

"It's like, well, we're not dying off that fast," said Via, who is 61. "And we have more disposable income. I don't have the college loans that those kids have."

Kavita Kumar • 612-673-4113