Urban outfitters social responsibility

BUSINESS CASE STUDY NAVAJO NATION AND URBAN OUTFITTERS1

Instructions: Read the entire case study to understand the expectations and components of this assignment.

Urban Outfitters In 1970, Dick Hayne, Scott Belair, and Judy Wicks opened a second-hand store named Free People across the street from the University of Pennsylvania. Their target market was the college student with little money. The company was created as part of an entrepreneurship class. It was successful enough that the owners incorporated it in Pennsylvania as Urban Outfitters in 1976. In 1992, they created a new store - Anthropologie - to target 30-45 year old upper middle class women – the same women who would have been “poor college students” in the early 70’s and may have shopped at Free People/Urban Outfitters. They took the company public (ticker URBN) in 1993 offering shares for $18. In 1998, Urban Outfitters opened its first store in Europe in addition to beginning its direct-to-consumer business and web page. In 2002, the Free People label again emerged in Paramus, New Jersey. Six years later (2008), Urban Outfitters acquired a popular garden center in Glen Mills, PA and developed Terrain at Styers, a retail store, event space, and café. In 2011, Urban Outfitters launched BHDLN, adding bridal gowns, accessories, party dresses, and gifts in to the portfolio. In 2016, URBN expanded in to the restaurant sector, acquiring The Vetri Family Restaurant Group and several independent cafes and restaurants. And in July, 2019, URBN launched a clothing rental service, offering their own brands and several other labels and vintage pieces at nuuly.com.

As of 2020, Urban Outfitters is one part of Urban Outfitters, Inc., which also includes the Anthropologie, Free People, Terrain, Nuuly, and BHLDN brands. Headquartered in Philadelphia, Pennsylvania, Urban Outfitters, Inc. had sales of over $3.9 billion for fiscal year 2020 (ended January 31, 2020) and net income of $168 million. As of January 31, 2020, there were 248 Urban Outfitter stores and 623 total stores (plus 11 restaurants) affiliated with the URBN brands. Urban Outfitters touts itself as a “ lifestyle retailer dedicated to inspiring customers through a unique combination of product, creativity and cultural understanding.”2

1 References and sources available with Professor Yordy. They intentionally have been left out of this case study write up because of some of the assignment requirements to use outside sources. This real lawsuit was settled out of court in a confidential settlement so we don’t know what the legal outcome would have been. In any event, the students’ task is to evaluate the ethical issues in this situation and not the legal issues.

2 https://www.urbn.com/our-brands/urban-outfitters

The Navajo Nation The Navajo Nation has been a sovereign nation since 1868. The tribe, known as Navajo since at least 1849, prefers the name Diné, which means “The People” or “The Children of Holy People.” It is the largest tribe in the United states and currently has over 332,000 registered members. The capital of the Navajo Nation is in Window Rock, Arizona, approximately 190 miles from Flagstaff, Arizona and 160 miles from Albuquerque, New Mexico.

The first Navajo Tribal Council was established in 1923 and served as the official government for the tribe until 1989, when the Navajo Nation established a three-branch government, similar to that of the United States and other major democratic republics around the world. Under its current structure, the tribe elects a President and Vice-President for four-year terms to oversee the Executive Branch. The 9th President of the Nation, Jonathan Nez, has served since January 2019. The tribe’s Legislative Branch, called the Navajo Nation Council, consists of twenty-four (24) Council Delegates who represent the 110 Chapters and who are elected to serve four- year terms. The Judicial Branch is headed by a Chief Justice. The nation’s Supreme Court was founded in 1985 and the courts work with tribal legislation under the traditional Navajo principles of “Peacemaking.”

Approximately half of the Diné live on the largest Native American reservation - approximately 27,000 square miles (17.5 million acres). This reservation, located in northeastern Arizona, northwestern New Mexico and southeastern Utah consists of high desert lands. The median age is 28, the median family income is $27,389, and the unemployment rate is approximately 56%. Approximately 10% of homes on the reservation do not have electricity and approximately 40% of homes have no plumbing (so water is hauled in) and have outhouses. The tribe is known for its beautiful silver and turquoise jewelry and its hand-woven rugs.

In 2004, the tribe created the Diné Development Corporation, or DDC, to provide economic opportunities for the Navajo Nation. The DDC trademarked the term NAVAJO and is the only entity authorized to issue licenses to others to use the name Navajo. According to tribal documents, the DDC registered over 80 different trademarks for a variety of products, including jewelry, backpacks, clothing, and tableware.

The Assignment You work for Urban Outfitters in the Marketing Department. Your research has shown that Native American designs are quite popular today. You developed “mock-ups” for some new products based on traditional Navajo patterns - included in this case study below. Because you live near the Navajo Reservation, you know how devastating the recent COVID-19 pandemic hit that population. As you put your proposal together, you included a provision that 1% of all profits made on these items go to the Navajo Nation Department of Health.