SARA LEE GOES RETAIL WITH JOHN & JANE
Byline: Katherine Weismann
PARIS — Sara Lee Europe has gone into the retail business.
At the end of August, the group opened a shop here, called John & Jane, which showcases its European intimate apparel and sportswear brands.
The store is in the new Passy Plaza shopping center in the chic 16th Arondissement, which also houses The Gap’s first Paris store.
The space measures 3,300 square feet and has 2,700 square feet of selling space. Currently, 21 brands representing roughly 4,100 stockkeeping units are sold, including the European lines for Hanes and Champion sportswear, Isotoner accessories and the famed Wonderbra line. It also is selling non-French brands like L’Eggs, Germany’s Nur Die socks and Italy’s Liabel cotton undergarments for the first time in France.
While the store’s opening does not signify a new distribution strategy for the group, depending on the sales results, Sara Lee might open more stores in the long term, explained Dominique Tron, the director of Sara Lee Europe Direct Marketing, S.A.
Sara Lee’s main goal in opening John & Jane was to regain business in this Parisian neighborhood, which it lost after an Inno variety store that carried many of Sara Lee’s brands closed several years ago. In its first weeks of business, the store has already proven its strategic value.
“From a marketing perspective, it gives us a lot of important information,” Tron added. “It enables us to test the power of certain products.”
John & Jane is, in effect, a brand laboratory. The company is able to get valuable consumer information about its own brands on its own turf, Tron said. It also permits brand managers to see how their brands perform in competition with another Sara Lee label. For example, in French department and variety stores, generally 10 pairs of the Chesterfield hosiery brand sell for every 100 pairs of Dim, France’s market leader. In John & Jane, 35 to 40 pairs of Chesterfields sell for every 100 pairs of Dim.
Consumers here don’t know that the giant American Sara Lee Corporation owns some of their favorite French brands like Dim hosiery and Cacherel lingerie.
“They see this as a regular multibrand store,” Tron said. A resulting problem is that clients ask for a label that isn’t part of Sara Lee. Currently, many French women have been asking for Wolford hosiery from Austria, which is one of the few leading European hosiery makers that Sara Lee doesn’t own. “We’ve educated our sales staff all about Wolford,” Tron said. Now, when a client asks for it, the salesperson brings the client to a Sara Lee equivalent and explains the value of the product over the Wolford line. But the sale doesn’t always happen.
The store does offer its neighborhood clients many advantages over traditional lingerie retailers. There is a broad selection and price range of goods in a self-service environment compared to a small boutique, which might cater to only one end of the market. With no department stores in this part of Paris, the store is filling a void. There are also informed, but not overbearing saleswomen to help customers find what they need, and comfortable dressing rooms, often a rarity here.
But full-service comes with full pricing. Tron said that with a relatively high rent, John & Jane maintains department store prices to meet its sales and profit objectives. The Wonderbra sells for between $37 and $47 (200-250 francs), while Dim hosiery ranges from $2 to $13 (11-70 francs).
Tron also said that offering lower prices would hurt its center-city retail clients who are now forced to compete with suburban discounters, factory outlets and hypermarkets. Prices at hypermarkets, like the Carrefour or Auchan chains, where many Sara Lee brands are sold, are between 15 and 20 percent less than department stores and boutiques. At John & Jane, 70 percent of current sales is in women’s products, while 30 percent is for men. The Dim brand, with its men’s and women’s innerwear and legwear combined, accounted for 45 percent of store sales during the first three weeks of operation. And since the store boasts both men’s and women’s wear, many couples shop together. Teenagers are also big customers, especially for the Champion brand, which is undergoing a huge marketing push here, complete with a commercial featuring Queen’s “We are the Champions” song. The younger clients are snapping up Champion’s hefty sweatshirts and team-licensed apparel.
Tron said that the company hopes to achieve pretax sales of $1.8 million (10 million francs) in its first 12 months of operations. In its first month of business, the store is on plan. On a recent Saturday, there were about 500 purchases made, representing about $15,000 (80,000 francs) in sales, Tron said.