News and Events News and announcements from the Retail Management Institute.
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Wednesday, Jan. 12, 2011
One of the main topics at the NRF 100th Annual Convention (Retail's Big Show) in New York this past week, was m-commerce. By 2012 more than 50% of all sales will be mobile-enabled in some way. The challenge that retailers have to overcome is how to integrate this new channel successfully.
In the seminar “Using Mobile Payments to Increase the Base of Contactable Customers” by Richard Crone, CEO& Founder of Crone Consulting argued that the use of mobile payment is the key to connecting to more customers. The rule is- The One Who Enrolls, Is the One Who Controls. The main goal of retailer is to move a customer from anonymous to contactable, to hopefully make them a loyal customer. If you can get customers to integrate your App through their whole shopping experience, they will be contactable for the retailer.
Customer usually use mobile to locate stores, research prices, or to find coupons and reviews. Mobile is an enabler channel- it is included in almost every other channel. Consumers use it increasingly in their in-store shopping experience. For example, when shopping in a mall the customer can use his smart phone to locate the store, to compare prices or to read product reviews. Barcode scanning has increased 700% last year. However, once the customer is in a store, Crone argues, that the cross- channel self-service has to be optimized. This is achieved by motivating the customer to pay through their mobile. As the rule is, The One Who Enrolls, Is the One Who Controls, mobile payment increases mobile engagement with that retailer.
M-Commerce has to be a customer driven model, and redefines the 4 P’s.
Place- Locator app, In-store locate products
Promotion- customized to area, demographic
Preference- customization of recommendations, coupons
Payment- easy mobile payment!
The integration of mobile allows the retailer to customize the customer’s shopping process through their whole purchasing journey. They key is to get customers enrolled…which is achieved through mobile payments!
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Friday, Dec. 17, 2010
Congratulations to retail studies students Sumeet Chadha ('13) and Bianca Frediani ('12) for winnning the FSF (Fashion Scholarship Fund) YMA scholarship!
The YMA Scholarship Fund is a national nonprofit association consisting of influential members of the fashion community, dedicated to promoting the education of the fa...shion arts and business by granting scholarships to talented students and facilitating internships
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Tuesday, Dec. 7, 2010
Santa Clara RMI students were treated to a visit with a special guest in late October. Angela Caltagirone, vice president of e-marketing at Williams-Sonoma Inc. and an SCU alum herself, talked about her current position, where the industry is headed, and what to expect next.
“I really encourage you guys to take a look at the Web aspect of retail as an area of interest because that’s where things are going,” advised Caltagirone to her eager student audience. After her junior year at SCU in the early 1990s, she interned at electronic retailer Good Guys.
“I really think it paved the way to get the position at Williams-Sonoma right after I graduated,” she said – a position she took upon graduating from SCU. Caltagirone has been with the company for 18 years.
The petite and energetic businesswoman described the growth she witnessed at the company.
“I was there in the late ’90s when we launched our e-programs. I think it’s been a fascinating decade – so much has changed at Williams-Sonoma, and so much more is to come.”
The things that have changed include the launch of a sufficient e-mail program that includes a 50 million customer database and an 18 million e-mail address file. Aside from e-commerce, Williams-Sonoma’s other retail channels include stores and catalogs. Instead of isolating each channel with particular market segments, the company tries to get these three channels to work together, as two-thirds of its sales come from multi-channel shoppers. “The more we can get them to cross-pollinate, the better,” explained Caltagirone.
Regardless of change, Caltagirone says the company stays true to one business fundamental.
“We do not blend brands,” she said.
Williams-Sonoma houses six brands within the company: Williams-Sonoma, Williams-Sonoma Home, Pottery Barn, Pottery Barn Kids, Pottery Barn Teen, and West Elm. “Each brand has a distinct customer…to blur them would be poor customer service.” Each endeavor for each brand has three goals: Conversion, Attribution, and Acquisition.
Caltagirone also touched upon search engine optimization, better known as SEO within the industry. She explained the difference between paid and natural search and how to optimize Williams-Sonoma’s presence in the world of Google.
Natural search refers to a company’s “natural” rankings within the Google results list. “It’s all about winning the popularity contest with Google to get your search result to the top,” she explained. In order to win the contest, a combination of good, descriptive coding and URL names and having your Web site linked on other prestigious sites is needed. “Having our site linked on credible Web sites such as cnn.com, or .gov’s and .edu’s is huge for Google rankings. We should probably work out some sort of link on the Santa Clara Web site,” she said with a wink.
Paid search is a different beast. When it comes to paid search, “We love Google and we hate Google,” Caltagirone said. With a 50-cent charge per click, paid search ads do not come cheap. “We’re always telling our employees, don’t click! don’t click!” she said with a laugh.
Williams-Sonoma does have some advantages in its relationship with Google. Currently, Williams-Sonoma is part of a new local search initiative in which it sends Google daily inventory reports so potential consumers can see what is in stock in their area.
The company has also created its own YouTube channel for the various brands, which was an instant success.
As far as what is to come for the e-marketing facet of Williams-Sonoma, the future looks bright. Caltagirone and her 15-person team have dabbled in Facebook ads, a fantastic tool that provides a ton of demographic insight given the nature of the social media site.
Additionally, a few months ago, Williams-Sonoma launched mobile sites. The sales aren’t huge – yet.
“We get 5 percent or less of our sales from mobile, but we expect to see it grow dramatically. I’ve heard that by 2015 mobile will completely outpace the desktop.” Caltagirone’s strong leadership can clearly be credited with anticipating the trend and getting in front of it.
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Tuesday, Dec. 7, 2010
Cynthia Gamage, RMI associate director, and Danielle Gustafson, office coordinator, were recently awarded the 2010 Leavey School of Business Extraordinary Team Award. RMI’s Executive Director Dale D. Achabal said, “They are the ‘heart’of the Retail Management Institute and work together very closely. Cynthia and Danielle are outstanding in their ability to work with students, faculty, on-campus speakers, the RMI Advisory Board, and visiting global executives. With a strong commitment to customer service, they are excellent mentors to over 80 students in the Retail Studies minor, setting high standards and at the same time remaining compassionate in working with students to develop their professional leadership skills.”
Given every year, this award recognizes the recipients among their colleagues at a special lunch and ceremony and is hosted by Drew Starbird, dean of SCU’s Leavey School of Business.
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Monday, Dec. 6, 2010
by Bianca Frediani ’12
“I believe that the young people of today are at an inflection point … it’s a time when this industry needs young thinking and needs people to change it.” This is only one of the brilliant insights that Vice Chairman of Phillips Van Heusen, Ken Duane, shared during his visit on November 10, 2010.
Duane, a member of the Retail Management Institute’s Advisory Board, was a part of the Retail Speaker Series. He gave a captivating presentation to students, addressing two main topics: Phillips Van Heusen and global sourcing. Duane stated that Phillips Van Heusen is a “company built on the back of a dress shirt … from that it has become the second-largest apparel company in the world.” Phillips Van Heusen licenses brands such as CHAPS/ DKNY, MICHAEL Michael Kors, Geoffrey Beene, and Hart Schaffner Marx. Also, Phillips Van Heusen owns brands such as Van Heusen, Izod, Calvin Kleinn, ARROW, and the recent addition Tommy Hilfiger. Tommy Hilfiger, a dominant force in Europe, was purchased for the price of $3.2 billion. Recent strategic plans have transformed Phillips Van Heusen from a company that had only 11 percent of its business international to now 36 percent of its business international. Tommy Hilfiger had been essentially closed down in the U.S. because it was not thriving here as it was in Europe. Phillips Van Heusen decided to bring it back into the U.S. after purchasing the brand. The key to its future success is maintaining Tommy Hilfiger’s European identity as preppy, young, and fun. The class had the privilege of seeing some of the new Tommy Hilfiger commercials that would soon be airing. The commercials were very entertaining and were successful in portraying the brand’s young and fun identity. It will be fascinating to see how the brand grows here in the U.S. after hearing how it endured in the past.
Next, Duane spoke about the global supply chain. He began by explaining that cotton is at a 140-year high because of a cotton shortage. This is due to various factors such as the recession, the growth of China, and the consumption of developing countries. He spoke about supply cost dynamics and the key issues for global apparel: raw material cost escalation, tight factory supply, competitive country movement, labor wage escalation, and freight/logistics supply and increasing costs. Duane made it clear that the retail industry is struggling with apparel inflation. He declared that at this time next year, prices will be up at least 15 percent. However, directly after describing the dilemmas the retail industry is dealing with, he went on to proclaim, “Never a better time to enter the business.”
He also explained how cost pressures and supply availability are affecting speed to market. The costs of labor and apparel have pushed companies to move to countries such as Bangladesh where costs are lower. Bangladesh produces 25 percent of Phillips Van Heusen’s units. This is part of a strategy to keep costs low and consumers happy. However, Bangladesh poses a problem for distribution because it only has one highway and one port. Phillips Van Heusen decided to take seven Boeing 747s to the one port, loaded them with their products, and brought them back to the U.S. Duane stated that this move added “… a $1.50 to each garment that we brought in from Bangladesh, but we did not want to interrupt supply.”
He concluded with Phillips Van Heusen’s plan to mitigate sourcing. The company will focus on capacity planning, fabric mill planning, greige commitments beginning of season, raw material consolidation needs, and diversity sourcing base.
Although he spoke about global sourcing issues that are plaguing the retail industry, Duane still offered some hope by firmly restating that this is the time to enter the retail business.
RMI
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