Martha Stewart is once again in the middle of a big controversy.  The controversy revolves around whether or not Martha Stewart is a good business partner.  Martha Stewart’s organization, Martha Stewart Living Omnimedia (MSLO) is in a three-way mess with JCP and Macy’s.  MSLO had a deal with Macy’s to exclusively sell home categories merchandise. MSLO is trying to get around its current agreement with Macy’s in order to also open separate MSLO boutiques in J.C. Penney stores.

Currently, Macy’s, JCP, and MSLO are in mediation.  Ron Johnson (former CEO of JCP) was looking for ways to break the exclusive agreement with MSLO and Macy’s.  Terry Lundgren, CEO of Macy’s, actually hung up on Martha Stewart when she announced the potential deal with JCP.  In the end, Macy’s has performed much better than the other two brands (JCP and MSLO) in the “he-said, she-said” argument.

This situation should serve as a reminder to retailers to think long and hard about the benefits before signing a contract with a celebrity.

 

Discussion Question:

What can retailers learn from the litigation between Macy’s/JCP, and Martha Stewart?

 

SOURCE: Al McClain, Retail Wire, March 12, 2013