A new look is in the cards for shoe and accessory retailer DSW Inc.
The company’s chief executive officer sat down with WWD while in Los Angeles for the National Retail Federation’s annual Shop.org conference to talk about the steps the retailer is taking to be relevant to consumers. DSW, with more than 1,000 stores in North America, is currently trying out a new store concept in Ohio and later this year will begin testing a shoe concierge service with some of its employees.
“I think the consumer over the last three or four years has not seen the kind of assortment that they had historically grown accustomed to at DSW and we are getting a little more edgy when it comes to the fashion element – not to an extreme,” ceo Roger Rawlins said. “If you look at good, better, best and how that stacks, elevating the better and best assortment, that’s a big part of what we’re trying to do. Over the last couple of years, the market had seen that we had stepped down the strengths of our brands [and] we’re getting very aggressive to go back after that.”
The company for the three months through July 29 saw same-store sales up 0.6 percent, turning positive for the first time since 2015. DSW notched a sales increase of 3.3 percent to $680.4 million in the same period.
DSW in January unveiled a new store concept it’s calling the Lab in Columbus, Ohio. The design of the store is industrial-inspired, going back to the retailer’s roots as an actual warehouse selling designer shoes on weekends. The assortment is increased with the new format, going from about 30,000 units to some 50,000 with technology for both employees and customers to help navigate the new layout.
The goal would be to expand the new concept to four or five more doors in the next 12 months, Rawlins said.
“We’ve got to get it out there and also learn how to operate it because it is more product and more complexity in operating that model and then we would make a decision on how many doors that ultimately would fit into after that,” he said.
While the new design was revealed earlier this year, it really wasn’t ready until around May, Rawlins said, as the company tweaked fixtures and made other improvements based on feedback.
While the company will continue to test and learn from the new design, the ceo said DSW has already observed two key factors that give it the confidence to continue forward with the test. The first is that while the new design reflects a significant change, it wasn’t so dramatic that customers wanted to stop shopping with DSW. The other observation Rawlins noted was people who hadn’t shopped with the retailer expressed interest in the store format.
“I think those two data points are important data points for us because we need to attract a new Millennial customer to our brand and we think this will be a great way to be able to do so,” he said.
Also in the mix for testing is a concierge service that includes shoe storage for customers’ out-of-season shoes and a rental service. Rawlins said those initiatives will be tested this fall in one or two stores in Columbus. It’s too soon to determine pricing on rentals, but it will likely be on higher-ticket items where a rental on a $250 pair of shoes would make more sense than, for example, a $29 pair of flats, the ceo said.
“You’ve got to figure out a different way to connect emotionally with the consumer. Some way to make you relevant to them so that the minute you think shoes, you think Designer Shoe Warehouse – whether it’s repair, rental opportunities, storage, buying an in-line item, buying something that’s a close-out, buying something that’s on value,” Rawlins said. “We’ve got to play in all of those places. If all you’re doing is selling shoes, that’s the same stuff that [competitors] have at a better price; eventually they’re going to figure out how to match your price and take your customer. You’ve got to have different reasons to why you exist.”
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