Brendan Hoffman, C’90, WG’97, President and CEO – The Bon-Ton Stores
Studying at Penn is a tradition in the family of Brendan Hoffman, C’90, and WG’97. Beginning with his grandfather, Charles Hoffman, W’37, then his father Bruce Hoffman, W’66, then followed by his brother, David Hoffman, C’98. With a penchant to keep learning, Brendan leveraged an early affinity for retail into roles of greater scope and responsibility.
When did you decide to make retail a career?
As a Penn undergrad, I had considered law, but ended up as a history major. In my senior year, my father said, “With a history degree, you’re going to make $12,000 a year and live at home.” I had to find a path to prevent that. That was the only time I could remember my father not being completely supportive of me, so those words were motivating. I decided to try retail as a career path because it offered terrific training programs and a solid foundation in business. It would allow me to get some good experience, and then go back and get my MBA. At my first job out of school, with Lord & Taylor, I realized that retail offered exactly what I was looking for: the balance of analytics from the business side, fashion, and a tangible product that was ever-changing. In 1996, I returned to Wharton to attend the Wharton Executive MBA program, which allowed me to keep working while I attended classes. I gained new tools to use and made relationships with other students to bring back to my retail career.
How did Wharton affect your career?
I was very fortunate. I joined Neiman Marcus out of graduate school in 1998. In 2002, they promoted me to CEO of Neiman Marcus Direct, the catalog arm of Neiman Marcus, doing $600 million in annual sales at the time. This division had been a catalog business since 1939. With the explosion of e-commerce, they wanted someone who was young, had the right skill set and was not weighed down by baggage of the past. So like lots of things, timing is everything. The board was also very clear that having that Wharton MBA was important to them and helped validate their decision to promote me.
What was that like — bringing an established catalog online?
It was like the Wild, Wild West. Every year, it was like starting over because things were changing so much. When I think of what it was like in 2002, particularly the luxury side of the business, when customers were apprehensive about shopping online, for Neiman Marcus to come out selling Manolo Blahnik, Prada and Gucci online, it was unheard of.
Did those e-commerce skills help your current work?
Absolutely, in today’s retail world, you’re going to be multichannel. For department stores like the Bon Ton, which are over 100 years old, e-commerce is the fastest-growing part of our business. It is not just giving customers the ability to shop online, but also gives us the ability to reach out and touch customers through email, apps, tweets and social media. Every year, the game continues to change. Those six years running a major e-commerce platform were invaluable to me, in that I understand how meaningful the Web and digital are for any business.
You are on the board of the Jay H. Baker Retailing Center?
Yes, it allows me personally to connect with two things I like most: Penn and retail. With the Jay H. Baker Program in its ninth year, today’s retail-oriented student has such a head start. We see them graduating into retail and starting on an executive path. When I went to Wharton, there was no classwork touching on retail, at all. In fact, I remember being in a class, while I was a dress shirt buyer at Lord & Taylor. One of the professors called on me and asked, “What does the dress shirt buyer want?” Through the Baker Program, we have hundreds of students who are exposed not only to a Wharton-based curriculum, but also to extracurricular activities that allow them to really understand a career in retail.
The trend to act local, eat local and buy local only grows. How does this play out with Bon-Ton’s local brands?
The Bon-Ton operates almost 300 stores in different regions, under different brand names: Carson Pirie Scott in Chicago, Younkers in Nebraska and Bon-Ton Stores on the Eastern seaboard. We serve big cities like Chicago, as well as more rural areas, so we serve a wide range of customers. We spend a lot of time trying to understand our different customer profiles, and to understand the merchandise assortment and a marketing cadence that touches all these different customers. In each of these environments, we also spend time understanding our customer as she ages, as the world continues to change, and as new customers find the Bon-Ton.
What’s your sense of consumers and their confidence today?
Retailers are a bit unsure of where the consumer is going, and what’s going on in Washington adds to that. Specific to the Bon-Ton, we focus on what we can control, and there’s enough there to improve the way the business has been run and provide a better experience for customers in the store and online — improve the products they’re considering and the pricing we are able to offer — to make sure this business keeps growing.
How is Bon-Ton responding to online retailers?
Positively. I think Amazon is doing things that other companies can learn from. They’re going to continue to grow and continue to be aggressive, and we just have to focus on what we can do to appeal to our customers. We have plenty of opportunities at the Bon-Ton, which has a thriving e-commerce business.
Boards have made you the CEO of large retail organizations, and it was reported that you were considered to head up J.C. Penney. What are your strengths?
One of the things that being at Penn and Wharton did for me was that it humbled me because I realized how many smart people surrounded me. That kept me grounded throughout my career. As a leader, you set the directions for the business. You have to be able to figure out what your goals are and what your strategy is going to be. You communicate that internally to your team, so you get everyone to buy in, and then externally to your stakeholders. Don’t let your ego interfere. I try to prepare my people to do their jobs so that I can be the least important person in the room. I need a head of marketing who understands marketing better than I do, a head merchant who understands merchandising better than I do and certainly a CFO who understands balance sheets better than I do. My job is to set the strategy and direction for the company, and get out of the way.
You were honored at the 70th annual Father of the Year Awards. Also, Bon-Ton Stores recently gave $426,000 to the Boy & Girls Clubs of America. Do you promote work life balance at your company?
I try to promote an appropriate work-life balance. When I was at Neiman Marcus, my CEO, Burt Tansky, was always very clear that our priorities were at home. Certain companies make you feel guilty for not being at the office. Achieving a work-life balance was a great lesson I learned at Neiman Marcus, and that’s what I tried to do at Lord & Taylor as well as here. Hopefully, that gives the people within my organization the opportunity to be good fathers, sons, mothers, daughters, wives and husbands.
Do you have any favorite books on the retail consumer goods industry?
I certainly have read a few over the years. My favorite was something called the “His and Her Book” by Stanley Marcus. It was about the fantasy world of the Neiman Marcus catalog. When I was named CEO of Neiman Marcus Direct, unfortunately, Mr. Marcus was in failing health, and I wasn’t able to spend time with him, but I liked knowing the history of retail, so I was able to get my hands on this book, along with his other books. As I was now in charge of this Christmas catalog, it was a great resource for me to go back through the archives and read his comments. In the ‘60s, he talked about something he called “sonavision,” which basically predicted the Internet — that someday we’d be able to sit at home and, through our televisions, be able to buy products. That was something that I saw, literally, my first week on the job there, and it gave me a framework for what I was doing and the responsibility I had with this brand. Another author was Marvin Traub, the legendary retailer at Bloomingdale’s, who wrote Like No Other Store … and Like No Other Career. I’ve devoured these books and others because there are great nuggets. I do find that what’s happened in the past tends to repeat itself, and so, I try to make sure I have as much knowledge of the past in my industry as I can.