EMBRACING A TWO-TIER APPROACH
Byline: Georgia Lee
ATLANTA — Satisfying the moderate sportswear customer has become a juggling act for many stores.
Looking to attract women from both ends of the fashion spectrum, these stores are pushing to get the latest trends on the selling floor the same season as junior and better brands for the fashion-now woman, while maintaining a fresh supply of basic goods for the consumer who prefers a certain look.
Over the past couple of seasons, department store buyers have stepped up efforts to update their departments with younger-looking clothes, such as stretch tops and capri pants, aiming to entice the Old Navy and Gap shopper.
At the same time, stores want to make sure they don’t alienate the core customer — a traditional, brand-loyal woman — so they are encouraging more updated looks from key labels like Sag Harbor and Alfred Dunner.
Another important vehicle in this merchandising strategy is a two-tiered private label program that targets these two types of customers. Among the retailers embracing this approach are Sears, Rich’s and Proffitt’s.
“Retailers have underrated this consumer. Her experience isn’t confined to her spending ability,” said Wendy Liebmann, president of WSL Strategic Retail, a New York-based retail and marketing consulting firm. “Today’s moderate customer wants more than basic, elastic-waist sweatpants.”
Liebmann added that mass retailer Target Stores had led the way in offering good fashion at a low price, so consumers now expect it from all retailers.
“The traditional career customer is still important. She’s loyal to key career brands, and that’s been part of our success,” said Sheila Kamensky, vice president, fashion merchandising at Rich’s. “We have to balance that business with the younger customer who wants trends of the moment.”
The updated segment of moderate is the fastest-growing for Rich’s, which is developing shop concepts for best-selling lines. Currently, Style & Co., its private-label collection; Emma James; John Paul Richard, and Ivy are all performing well, according to Kamensky.
Items and classifications from private label Jennifer Moore have also been strong. While building updated areas, Rich’s still relies on Sag Harbor, Norton McNaughton and Koret to serve the needs of the more traditional customer. This woman doesn’t want cutting-edge trends, but she responds well to newness in color or fabrics and in softer silhouettes, Kamensky noted.
At Sears, private label now accounts for about half of its overall sales volume and has grown faster than its branded business in the past 18 months in moderate. Private label is divided into traditional and updated areas, with career and casual divisions for each. Laura Scott and Classic Elements are the traditional lines, while Apostrophe and Crossroads are the updated offerings.
“Trends go anywhere with the updated customer,” said Diane Paccione, vice president, general merchandise manager at Sears. “We’re no longer six months behind.”
In Crossroads, best-selling spring items are cropped or capri pants, while strong items for Apostrophe include a split V-neck cardigan. Orange has been the most popular color.
Even traditional areas are increasingly updated, mostly through color or fabric, while maintaining a misses’ fit and comfort features. For the traditional customer, who tends to be brand loyal, Sears maintains two key vendors — Sag Harbor and Norton McNaughton — which have high brand recognition and a reputation for quality, said Paccione.
Sears’ ad campaigns, such as spring’s “The Long and Short of It,” focus on trends, presenting options for skirts, pants and sleeve lengths.
At Proffitt’s, a 31-store division of Saks Inc., updated looks account for a third of the moderate department, and growing. Private label constitutes around 20 percent of overall moderate business.
“We’re pushing it with updated trends. The void has been in brands for the younger customer,” said Carolyn Morris, senior vice president and general merchandise manager of ready-to-wear. “We want to get the Ann Taylor-Banana Republic customer, but we have to be careful not to move too quickly, to keep the right price-value-quality relationship.”
Prices, averaging around $30 retail, are capped at a $60 limit.
Proffitt’s has added updated vendors, including John Paul Richard, Cleo and Ivy. Updated lines — private label and branded — are now clearly separated from traditional lines, which include Koret, Norton McNaughton and Sag Harbor.
“We’re defining our focus within the departments,” said Morris, who added that the updated moderate department flows into better areas, to encourage crossover shopping.
Balancing traditional merchandise with updated looks is a key strategy at Mansour’s, a LaGrange, Ga.-based moderate-to-better specialty store with four Georgia locations and a fifth set to open this summer, according to Luke Mansour, general merchandise manager.
Mansour’s began updating its moderate departments for fall 1998. With Alfred Dunner and Koret as core traditional resources, Mansour’s carries over 150 lines, including updated resources such as Emma James and Ivy.
Adding square footage to expanding updated areas, Mansour’s downsized its low-end commodity business and deleted some core basics. Advertising includes younger models and more full-page statements that emphasize trends or key items.
Mansour said he constantly edits lines, although he added that most vendors, including traditional lines, had successfully updated offerings. With three more stores planned over the next few years, Mansour looks forward to reaching a size where private label is possible. Its moderate category, which now accounts for around 44 percent of volume, will reap the benefits with focused, quality, on-time trends, he said.
“Two years ago, it was unheard of that moderate areas would have the same trends in the same season as better,” he said. “Trends used to flow from juniors to better to moderate. Now all three areas get them at the same time.”
Jimmy Dawahare, general merchandise manager at Dawahare’s, a 27-store moderate chain based in Lexington, Ky., finds that private label is the best way to meet higher quality and value expectations. Private label allows special cuts and key items, without the competition from promotional department store vendors. Dawahare’s brands are all private, excepting Sag Harbor, which Dawahare laments “is everywhere.”
Over the past few years, Dawahare’s has undergone a complete change in “mind-set” toward the moderate customer, said Jimmy Dawahare.
“We [retailers)] are finally waking up. We haven’t catered to her needs,” he said. “This is now a want-based, rather than a need-based business, where the lowest price may not be the best value. This customer wants steak cheap, but not cheap steak.”
Spring bestsellers, in the $30 to $50 range, have been fashion items, according to Dawahare — a floral-print capri pant by Sag Harbor sold 93 units in two days during March, while a boatneck knit shirt with three-quarter sleeves sold 116 units for the same period.
Dawahare’s will add more on luxury items, an untapped area for moderate, testing cashmere and silk knits that push prices up to $70 for fall.
“Today’s economy dictates that we push the envelope in price,” he said. “I’m only sorry we didn’t jump on the pashmina shawl trend at a price.”
Not all stores are taking the two-tier approach. Lerner New York is targeting a customer with a young attitude, and over the past few seasons updated over 600 stores from a multibrand moderate chain to a private brand retailer.
The New York & Co. brand, launched under design director Charlotte Neuville, targets a woman around 33 years old. Store layouts and clothing reflect urban street fashion and casual career looks in a lifestyle collection.
“We maybe lost the knit-stirrup-pants-and-tunic customer we used to have, but we’ve gained a clear point of view,” said Jackie Corso, executive vice president of merchandising. “The moderate market is much more up-to-date now. Department stores don’t give the customer enough credit.”
Key spring trends reflect fashion trends in general — cropped pants, stretch, prints, bareness and a general return to femininity, said Corso.
The new approach has paid off, said Corso. For 1999, the first full year under designer Neuville, sales increases were between high single digits and low double digits. Corso predicts similar sales gains for this year.