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As contemporary specialty retailers struggle to compete with the deep discounts offered at department stores, designers are developing new ways to help them capture customers.
This story first appeared in the January 15, 2009 issue of WWD. Subscribe Today.
Take Rebecca Taylor, where the sales team met Tuesday afternoon with Beth Bugdaycay, Taylor’s business partner and chief executive officer, to discuss new ways that they can get closer to their customers.
“We are working to make sure that the entire company is aware of our objectives,” Bugdaycay said. “While product and brand visibility were always important key factors in running the business, we realize we have to offer accelerated customer service these days.”
That service, Bugdaycay said, means the company is eager to help out the more than 400 specialty boutiques that carry the line in any way it can. Her sales team, which travels nationwide regularly, will make more store visits than ever in order to help a customer shop the store, answer questions and understand how the retailer does business. And so far, this tactic has worked.
“I cannot say enough good things about Rebecca Taylor,” said Stacey Pecor, owner of the four Olive & Bette’s boutiques in Manhattan. “They will do just about anything to learn my business. Their salespeople are on my sales floors helping my customers. I swear, they would sweep the floor for me if that meant they can get closer to the customers. It’s really such an amazing thing, and because of this, I will always support them.”
While this is a time-consuming process, Bugdaycay said there is no better way for the firm to get a handle on what its customers want from them.
“We encourage the team to ask questions, listen and try to read between the lines to hear what the customer really wants,” she said. “This sort of information has been extremely helpful to us when we plan for the next season.”
In addition, Bugdaycay said she is working on new ways to get shoppers into their company-owned freestanding SoHo store.
“It’s very important that we get her to pay full price for at least the first six weeks the product is on the floor,” she said.
To that end, she has various events planned, such as having a manicurist in store for a couple of weekends and a gift-with-purchase, where customers will receive a bottle of nail polish, the color of which was seen during the Rebecca Taylor spring 2009 runway.
Other contemporary firms are developing different ways to connect to their specialty store customers. This is especially important as these stores have to offer special merchandise that can’t be marked down in department stores.
“Specialty stores we have been selling for 10 years are going out of business,” said Shoshanna Lonstein-Gruss, owner and designer of Shoshanna. “They just can’t compete in this environment. When department stores are marking things down by 80 percent, there is no way a small specialty store can do that and stay in business.”
Many of those stores have already gone out of business — Sugar Mag in Chicago, ChicFash in Silver Spring, Md., Chic in Cold Spring, N.Y., and Tracy Ross in Los Angeles, to name just a few. While each store places relatively small orders from each brand, added together, they represent a significant amount of business lost. That business is particularly important to contemporary companies, which sell primarily to specialty stores.
Lonstein-Gruss said that in the months ahead she plans to be in the stores more often — working with customers on swimsuit fittings and helping women find the perfect dress for their body type.
“It’s all about the customer. I’m the customer — it’s the reason I started this business in the first place,” she said. “My first year in business I did 56 trunk shows and I had fun doing it, so now I will hopefully be doing even more. It gives me direct feedback from shoppers, and it doesn’t get any better than that.”
Abbey Samet, contemporary market analyst at The Doneger Group, said it’s services like trunk shows and personal appearances that will help specialty stores survive in a recession.
“Designers should be in the stores, talking to as many customers as they can. That can only help business and strengthen a partnership between a designer and store owner,” Samet said. “But ideally, what stores should be doing is concentrating on what makes their specialty store special. We need to go back to what we saw in the Sixties, when fashion retail was all about service — all about making the experience exciting and glamorous.”
Samet said that sprucing up fitting rooms by adding a more comfortable chair, offering the customer a bottle of water or a cup of coffee are just a couple of things that specialty retailers should be thinking about. Doing trunk shows and appearances, she said, can be part of the services offered.
Andy Oshrin, chief executive officer at Milly, agrees, especially since more than 50 percent of Milly’s business is conducted through specialty stores.
“Our regional sales teams will be visiting these retailers frequently throughout the spring, and we have budgeted for special events throughout the season,” Oshrin said. “Currently we have 11 trunk shows or focus days planned for specialty stores during this time, many of which will be attended by [our] designer, Michelle Smith. We also plan to offer special gifts and shopping incentives at these events to create a good feeling about our brand for both retailers and customers.”
With that said, Oshrin said he has worked to find a balance between satisfying his specialty store base while growing in the department stores, like Bloomingdale’s, where Milly also sells.
“Milly currently maintains over 25 local brand specialists in our key doors throughout the country. These individuals serve to promote our business and to communicate what is special about our brand. They also provide valuable feedback about what is working and sometimes what is not working,” he said. “We will visit all of these focus doors throughout the season and have confirmed at least five meet-and-greets with Michelle. At these personal appearances, Michelle will interact with customers, help organize fashion shows and partner with local charities to create excitement. In addition, we have another 15 to 20 Milly department store focus days planned where our regional coordinators will meet with our customers and the full complement of sales staff in order to promote our brand.”
For Nanette Lepore, one of the most important factors to running a thriving business has been to continue manufacturing in New York. This practice not only ensures that the company can get product on the sales floors faster, but it is also working to feed the American economy — an issue that many consumers praise.
“People want to feel good about what they are acquiring, and we know this from being intimately in touch with our customers and shop owners,” said Heather Pech, chief executive officer of Nanette Lepore. “If I could, I would have Nanette in the stores all day, every day, but that’s just not realistic for us, so we are working with individual stores to make sure they have product selling. Nanette is stepping up her appearances, but because we manufacture in New York, we can take a close look at what’s happening today and make quick adjustments. It’s easy for us to work directly with our factories since they are literally right here in the Garment Center.”
In addition, Pech said the company is currently working on new technologies that will bring social networking directly into Nanette Lepore stores. Without divulging details, Pech said it will be a major step to pushing the business in a new direction.
“This is no longer business as usual,” she said. “So we can no longer run our businesses in the same way.”�