STRIVING TO GET BACK ON TRACK
Byline: Marc Karimzadeh
NEW YORK — For accessories makers, the times of merchandise reaching record sell-through rates and stores writing orders with seemingly unlimited open-to-buys has passed.
Clearly one of the hottest categories in fashion the past three years, many accessories executives admitted that business this year has been challenging as a result of low consumer confidence and declining store traffic. But many said the category traditionally weathers economic volatility less severely than apparel, for instance, since accessories offer an easy and often affordable way for women to update their wardrobes. As a result, while the fast times have slowed, vendors said they have been able to register slight increases over last year.
“In accessories, we depend on traffic because it is impulse driven,” said Abe Chehebar, president and chief executive officer of Accessory Network. “When traffic is down, there is a decrease in spending in our category, and although we have been getting decent [weekly] sell-throughs between 6 to 10 percent, we usually look for 10 to 15.”
Many firms have lowered their second-half projections and strengthened their focus with new ideas to capitalize on sales opportunities.
Among the strategies:
An increased emphasis on tracking merchandise more regularly to analyze what isn’t selling and quickly react through promotions or shifting merchandise to other store locations.
Reducing inventory levels.
Simplifying trend and brand messages through clear displays and more advertising.
More innovation in gift packaging to boost holiday sales.
A major issue is how stores, which are already buying closer to need than ever before, will plan their holiday season, if early fall continues to move slower than expected. Some said that because open-to-buy was lowered for many stores, buyers now have to reduce their assortment, since inventory is backing up.
“If this trend continues, it will have an affect on the holiday season because the key to success is constant newness,” said Chehebar. “The customer needs to be motivated to buy and if goods are backed up, it lessens the possibility of the retailer having newness on the floor.”
At Accessory Network, Chehebar said there will be an increased effort to “micromanage business and evaluate performance by store.” He added this could include offering help on product that isn’t selling by moving it to more productive stores in other regions or supporting markdowns.
Cherie Christmas, president and co-owner at Maxx New York, said: “You need to build the relationships with stores by servicing them, watching the selling and merchandising and getting them back into product that sells.”
For fall, the company has hired two new in-store merchandisers who will travel nationwide to analyze store performance and assist with merchandise presentation. Maxx has lowered its inventory stock position from nearly 100 percent to 20 percent to avoid being stuck with unsold goods.
“Everyone is more atuned today,” said Carolee Friedlander, president and ceo of Carolee Designs. “We are a little more conservative in our mind-set by careful scrutiny of EDI [electronic data interchange] plans and by working more closely with stores on marketing events.”
Carolee was just sold to Retail Brand Alliance Inc., the former Casual Corner Group. (See story on page one).
This fall, Carolee is increasing its marketing efforts by 15 percent. Besides 100 in-store bridal events, the company also is holding 50 trunk shows or informative events on how to combine pearls with vintage jewelry.
“We are focusing on the opportunity of vintage pins and brooches and how they tie into the successful pearl business,” Friedlander said.
Newness, she added, also will be more important to lure customers this fall, and the company has stepped up its new product offerings.
The need for newness rather than playing it safe with more traditional looks, was voiced by many vendors.
“A lot of closets are full, so we have to design product that inspires an emotional response,” said Steven Roberts, president of Echo Design Group, where up to 90 percent of merchandise is new this fall. “People want to feel good about the product and the purchase more than ever, since they aren’t buying as freely as they have in the past.”
Echo is launching a home decorating book titled “Time at Home” this September and is continuing to develop its advertising campaign, which launched last spring. For fall, the ad campaign was shot in Connecticut by Perry Ogden and features wintery lifestyle images with the tag line: “Every moment has an Echo.” The ads will bow in September issues of Harper’s Bazaar, Marie Claire and House Beautiful.
Many accessories firms are stepping up their advertising efforts to strengthen the brand awareness in these tough times.
Cole Haan is increasing its handbags presence in ads tenfold, said Matt Rubel, chairman and ceo. The ads will launch this September in books such as Vanity Fair, Vogue and Departures.
“[A challenge is] to really entice the consumer with relevant yet exciting product because you don’t want to get too basic during more challenging moments,” said Rubel, adding that Cole Haan is also introducing colors into some of its core programs “to really pop the floor, sprinkling in novelty, but allowing a focusing of the assortment.”
The way in which items are being displayed will be key to snare consumers for fall and holiday. Friedlander at Carolee said her firm is continuing to update stores with new display props that were introduced last year. They allow for a cross-merchandise presentation with a group theme, which Friedlander said increases multiple sale opportunities.
“We try to be very proactive, otherwise you wind up with unsold inventory,” she said.
Ed Bucciarelli, president of LCI Accessory Group, echoed that when he said: “We really put the marketing effort in-store.”
For fall, the company put together a focused gift-giving strategy that tied together product, packaging, graphics and fixturing, he said. Traditionally, the firm wrapped some of its fashion jewelry, but for the first time this holiday, other classifications such as small leather goods and socks will be included in the program, too.
The Aigner Group also has redesigned its gift boxes, which will be used for several items including key chains and wallets. Each burgundy box interlocks when put on display “to give [departments] a different look,” said Jay Friedman, president of accessories, adding that the packaged holiday gift business is ahead by more than 20 percent. “We anticipated business in open-to-buy would be difficult, so we need to give buyers and consumers reasons to buy.”