Designing a strong business

11/9/2009 - Housewares retailer Crate and Barrel was conceived by a newlywed couple with good taste, little money and no place to shop.

Gordon Segal '60

“We saw a void in the 1960s — there was very little good design,” said Gordon Segal ’60, Crate and Barrel chairman and founder. “People would get their glasses from the local gas station.”

Segal talked to Kellogg students on Oct. 29 about the history of Crate and Barrel and shared his insights on the future of design and technology in the consumer retail industry.

“We realized we could provide a plethora of goods that people hadn’t seen. Our job was to bring the lifestyle of Europeans to Americans,” Segal said.

Segal and his wife, Carole, travelled throughout Europe on their honeymoon and observed the classic style of European households. Knowing that other American couples were also searching for affordable and stylish furnishings, the couple borrowed $17,000 from family members and in 1962 opened the first Crate and Barrel store in Chicago. The company name was inspired by the packaging that the Segals used to display their beautiful and simple dinnerware, glasses and pots.

The Segals traveled to trade shows across Europe to purchase items for their store. They also cut costs to consumers by buying directly from the manufacturers themselves.

“We wanted to have great products that were affordable,” Segal said. “You have to bring design to people at a price that makes sense.”

Today, Crate and Barrel is still known for offering stylish housewares at an affordable price. It has grown to 160 stores and 7,500 employees.

From its visual displays to its advertising to its product packaging, Crate and Barrel is steeped in design because people desire things that are functional and beautiful, Segal said.

“You want them all to tie together as a cohesive design idea to excite people,” Segal said. “You are the buying agent buying things that customers want and can afford.”

To be competitive in today’s marketplace, design is critical, Segal said. He cited companies such as Phillips Lighting and Proctor & Gamble, for whom he said design is an essential part of their marketing.

Segal has been a strong proponent of design, endowing the Segal Design Institute at Northwestern University. “If you don’t get design thinking in the thought process, we’re not going to be successful against China, Japan, India and the rest of the world,” Segal said. “Design is the key to being unique, to success.”

He encouraged business students to put design top of mind and to employ people who have the passion and vision to recognize design’s importance. “Be a leader in product and innovation,” Segal said. “You need to take us somewhere that we’ve never been before.”