Urban Outfitters Needled for Lack of Common Sense

New drug-inspired salon at flagship store calls management's judgment into question.

Jun 23, 2014 at 8:00PM

Source: Hairroin.

Can you smell that? It's the smell of desperation. Urban Outffiters (NASDAQ:URBN) is trying to show just how edgy its fashions are by opening a new salon named "Hairroin" (see what they did there?) in its new flagship store in New York while handing out pens designed to look like hypodermic needles that say "I Love Hairroin." Instead, it comes off looking like some irrelevant reality TV star grasping for more than her 15 minutes of fame.

Maybe 20 years ago when Kate Moss was the epitome of so-called "heroin chic" in the fashion world, Urban Outfitters would have been seen as trendy, but does anyone really think mainlining deadly drugs is cool? The new promotion is just so much crying out for attention -- and maybe the company ought to spend more time focusing on its clothing lines, since revenues at its namesake stores tumbled 12% to $277.7 million in the first quarter as comparable-store sales fell year over year.

Although its Anthropologie and Free People concepts performed much better than Urban Outfitters, CEO Richard Hayne said that the chain is still working to "regain its fashion footing." Apparently that includes glamorizing illicit drug use.

At the risk of coming off as prudish, heroin is no joke, as the death of actor Phillip Seymour Hoffman earlier this year attests. Between 2006 and 2010, heroin overdose deaths surged by 45%, according to the U.S. Attorney General's office, though the vast majority of drug overdose deaths still involve pharmaceuticals. That's OK, Urban Outfitters had that covered too: Last year the retailer thought it would be great fun to sell shot glasses, flasks, koozies, and beer mugs that looked just like prescription pill bottles.

Screen Shot

Source: Urban Outfitters.

With the vast number of teen retailers populating a mall, the need to stand out from the crowd is understandable. Abercrombie & Fitch used to push the envelope of decency and good taste with its advertising; American Apparel, which just tossed its CEO on his ear, definitely did; and Nike has been no stranger when it comes to controversial ads. Video-game makers have also been accused of glorifying crime, such as Take-Two Interactive's popular Grand Theft Auto franchise, where the whole purpose of the game is to commit murder and mayhem.

Yet you have to wonder about management's judgment when it thinks heroin usage and hypodermic needles are cool. Yes, Hairroin is a business apart from Urban Outfitters, with salons in California, so the paraphernalia is not the retailer's per se -- but the teen retailer has been courting the salon for several years now, and having it go bicoastal, with a presence in its flagship location, indicates management sees it as lending it "street cred."

Just because you can do something doesn't mean you should. Urban Outfitters was forced into pulling its "fun" prescription bottle tchotchkes after a swell of protest rose up around selling such goods to teens, and I can't imagine heroin usage would be any different. Perhaps it's going by the motto that any publicity is good publicity, but being so edgy means it also risks falling over the edge.

With its stock down 22% from recent highs, Urban Outfitters might want to instead focus on how to make its threads more fashionable rather than on figuratively urging its customers to get high.

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Rich Duprey owns shares of Abercrombie & Fitch Co. and Nike. The Motley Fool recommends Nike, Take-Two Interactive, and Urban Outfitters. The Motley Fool owns shares of Nike. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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