NEW YORK — Lands’ End is having a seismic effect on Sears, Roebuck & Co.
The Internet and catalog brand has shipped its goods to all 870 Sears stores this fall. Top Lands’ End managers have assumed bigger roles covering Sears and its Lands’ End division. And now, Sears has a changed philosophy about selling apparel online. Sears.com will begin selling apparel late next year, along with tools, appliances and replacement parts.
Selling apparel online — something Sears has resisted ever since sears.com went live in 1997 — is a strategy to boost revenues and get the Sears selling channels in sync, so sears.com mirrors what the Sears stores sell.
It’s also a strategy that will take advantage of Lands’ End’s fit technology and fulfillment capabilities. The Sears distribution center for Internet fulfillment is geared for hard goods, while the Lands’ End distribution center can handle apparel. Sears bought the $1.6 billion Lands’ End in May 2002 for $1.9 billion.
“We intend to sell apparel online by the end of 2004,” Sears chief executive and president Alan Lacy said at the Shop.org conference here at the Grand Hyatt. Shop.org, a forum for Internet retailers, is a division of the National Retail Federation.
In addition, Lacy said Sears will relaunch its Web site on Sept. 30. “The new site makes browsing and researching easier,” he said. “You will be able to zero in on choices with fewer clicks.” He also said it will have more information on products, particularly appliances, the first category Sears brought online. Hits to sears.com lead to $1 billion in appliance sales, either made online or at the stores. Appliances are the biggest single component of its online operation and it remains a healthy business, even as Sears struggles in apparel and works to improve the offering.
Lacy’s confidence in selling apparel online is partly based on his own experience shopping Lands’ End online. He purchased a Lands’ End custom shirt via the Web and wore it for his speech at the conference, along with a Lands’ End suit.
There’s also a general sense that apparel has huge sales growth potential online. According to Forrester Research, there will be a 54 percent increase in U.S. apparel, footwear and accessories sales online this year to $8.3 billion, from $5.6 billion last year.
Further encouragement springs from Lands’ End. The brand did $435 million in online sales last year, compared with about $325 million the year before, Bill Bass, senior vice president of Lands’ End e-commerce, told WWD. Bass, who also holds the title of vice president and general manager of Sears Customer Direct, said the online business is the most profitable part of the overall Lands’ End operation.
The Sears officials said it’s too soon to disclose what apparel will be on the site. But it’s logical that Sears would include its top apparel brand, Lands’ End, as well as other key proprietary brands, such as Canyon River Blues. With Lands’ End products in all 870 Sears department stores as of Sept. 8, “it becomes a natural to get apparel up at sears.com,” said Bass.
The Sears site has a few links to other branded apparel sites, including Lands’ End, but Bass said, “We’re not happy linking up to other people’s sites.” He suggested it’s a hassle for shoppers to link up with other sites because they have to first check out their Sears basket, and create another basket at the next site.
Sears has been a follower, not a leader, online. The retailer has historically kept a low profile online, though that’s been gradually changing. In late 2001, customers could start picking up items bought online at the stores and in 2002, the site “crossed over into profitability,” Lacy said. Last May, Sears began including the Web site in national advertising.
The Sears site gets 4.3 million unique visitors each month, and the rate is picking up, Lacy said. He added that 15 percent of store sales are influenced by customers researching products online.
He also said one of the factors that led to acquiring Lands’ End was its custom-fit technology. Customers feed in such information as height, weight and shoe size, and clothes are customized to their body type.
Lacy said the integration of Lands’ End into all 870 stores has gone “remarkably well,” though he acknowledged some obstacles. “Lands’ End has a northern climate bias and does not have a multicultural customer base.” Bass did say the company is “trying to come up with a southern and some regional strategy” for Lands’ End. Also, some retail observers believe more has to be done to distinguish the brand presentation in the stores.