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At every company he joins, Gary Kusin hangs three words on the wall: “Data is oxygen.” This simple mantra led him to co-found the company that became GameStop, co-found the Laura Mercier makeup brand, and manage $2.4 billion merger between Kinko’s and FedEx. In his book Always learning: Leveling up lessons from GameStop to Laura Mercier and beyondKusin emphasizes that his breakthrough achievements in retail are as a consequence of his attention to data.
“I need the data, and it’s very hard for me to just say, ‘Well, we’ll blow it up. Let’s open these stores». No, let’s not do that,” says Kusin. “Let’s have answers to questions that the landlord may ask us. When entering into negotiations, let’s find out what percentage of the rent we can afford. So when the landlord tells us what the offer is, whether it’s that much or less, we’ll be fine.”
When we think about data, we often think about data quantitative data or numbers. However, some of the most vital data Kusin collected over the course of his profession was qualitative in nature, focusing on characteristics relatively than quantity.
For example, he observed that malls were losing out to emerging markets specialty stores like Blockbuster. He shared this commentary with his former Harvard Business School colleague Jim McCurry, who worked in the emerging video game industry. Drawing on the similarities between video games and Blockbuster, the two launched the world’s first software retail store, Babbage’s – or as we know it today, GameStop.
“We did our homework,” Kusin says. “We made sure we had hypotheses about what would happen. We tested them. Sometimes it took six months and we learned a hard lesson that we had to back away from. But [collecting data] that’s kind of my modus operandi in almost everything I do.”
After his success with GameStop, Kusin took on his next challenge in the beauty retail industry. He heard about MAC from a former colleague, then-CEO of Neiman Marcus, and desired to see if he could start his own line. Kusin has a deep knowledge of the history of cosmetics, tracing its evolution from makeup artists equivalent to Estée Lauder, to lab-developed brands equivalent to Clinique, and finally to fashion houses equivalent to Chanel. He liked the idea of bringing the highlight back to makeup artists.
A friend introduced him to an older salesman and together they began looking for their makeup star. “We interviewed various makeup artists and Laura Mercier was the only one who had a very clear idea of what she wanted to achieve with her makeup lines,” says Kusin. “So we signed a long-term licensing agreement with it, took off, and the rest is history.”
Kusin proves he has his finger on the pulse industry trends is the key to building a sustainable business. More importantly, he never made these efforts alone. By cultivating relationships with classmates and colleagues, you’ll be able to discover untapped opportunities and turn them into global brands.
Kusin’s obsession with hypothesis testing and data collection proved especially useful when he was tasked with turning the $11 million-loss Kinko’s into a profitable business and preparing it for sale.
“I realized that everything I learned between starting Babbage’s and Laura Mercier would apply to Kinko’s,” Kusin says. “For the first time in my life, I truly felt like I was born to do this.”
While most individuals in his position might have began at the top, arranging meetings with senior management at corporate headquarters, Kusin had other plans.
“We had 42 regions in the United States and 1,200 stores,” Kusin says. “I said, ‘Over the next two to three months, I’m going to visit every one of our 42 regions and hold town hall meetings on every shift, in every market.’ I asked the same thing at every town hall: “What the hell happened to this company?” How come we lost money while offering such an amazing service that customers need? When I finished, I knew what the problem was and what the solutions were.”
After three years, Kinko’s achieved EBITDA of $240 million, and Kusin facilitated the sale of the company to FedEx for $2.4 billion. This illustrates two key lessons for every entrepreneur. First, when your business fails, get down to earth and talk to your employees and customers. You may have theories about what the problem is or what customers want, but you’ll never know for sure unless you ask and collect that data. Second, there are many ways to achieve the same goal. – Kusin emphasized paving your personal path based on what you prefer to do.
“Any path leads to the podium, as I call it,” he says. “There is no one way. If you ever hear the word “should” appear in a sentence coming out of the mouth of someone who is trying to tell you what you should do, you run the other way. You need to think about what will work for you. What are you comfortable with, and how are you going to take the things that you’re comfortable with and use them to gain knowledge that will make you better at the business you’re trying to start?”
From creating the first components of GameStop to finalizing the multi-billion dollar merger, Kusin attributes his success to the following philosophies:
- Nurture your relationships with old friends and colleagues. By staying connected to your network, you never know what untapped opportunities may arise.
- If you need to know what’s happening on the front lines, take a look. When it involves marketing, you never know what customers want unless you ask them. Armed with this data, you’ll be able to do it use customer feedback to enhance operations.
- Before you make a decision, do your homework. Entrepreneurs often get so excited about a recent enterprise that they forget to do the calculations and research to make sure its functionality and effectiveness financial stability.
- When your small business is down, ask your employees why. While generating hypotheses is essential, it is equally essential to talk on to the employees who best understand the day-to-day issues. They may also have the best insight into potential solutions.
- There are many solutions to the same problem. Just because someone can solve a problem once does not imply you have to follow their exact method. Use your intuition to unravel problems in your personal way, consistent with your small business model and goals.
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Editorial contributions by Erin Palmero and Kristi Lindahl