Three retail comeback stories that’ll inspire you

  • Opinion
  • February 11, 2016
  • Francesca Nicasio
Three retail comeback stories that’ll inspire you

Retail may be one of the best and most exciting industries around, but it’s also one of the most competitive. From price wars and retail rivalries to rapidly evolving customers and tech updates, keeping up with (or staying ahead of) trends, customers, and other merchants is a huge challenge.

But that doesn’t mean the endeavour isn’t worth taking. As you’ll learn in this post, many retailers just like you are also feeling the pressures of the industry. But thanks to a bit of creativity and innovation, they were able to overcome their challenges.

Check out the retail comeback stories below and let them inspire you to take positive action towards your business.

Kohl’s uses tech, loyalty, and better merchandising to turn things around

Kohl’s was one of the retailers that was hit hard during the recession. As Fortune reported, economic downturn meant fewer people qualified for the Kohl’s store card, “depriving the store of both millions of potential new customers to mitigate natural shopper attrition.”

This, coupled with slow growth, strategic errors, and the rise of off-price chains and discounts stores resulted in little to no comparable sales growth in four years.

To address this business slump, Kohl’s has made several strategic moves, including going omnichannel, launching a loyalty program, and revamping its merchandising efforts. And fortunately for the retailer, it seem like things are starting to look up: Kohl’s had a strong 2014 holiday season and saw comparable sales grow for two quarters in a row.

So what exactly did Kohl’s do to turn things around? Here are some of the steps the retailer took:

Investing in technology

The retailer decided to keep up with the modern needs of consumers by making an effort to be more omnichannel. Kohl’s is integrating its brick-and-mortar stores with ecommerce, allowing them to serve shoppers across multiple channels and offer services such as buy online, pickup in store.

It also launched a mobile app that lets users scan and store Kohl’s cash, get product availability information, and place orders for pick-up. Customers who are part of Kohl’s loyalty program can also manage their memberships using the app.

Yes2You loyalty programme

Kohl’s launched a loyalty programme called Yes2You, to attract shoppers who don’t have a Kohl’s store card. The loyalty programme allows shoppers to earn points for every dollar they spend, and enables them to share offers with friends, receive bonuses, and more.

According to Fortune, the programme seemed to be paying off. Michelle Gass, Chief customer officer at the company, told the publication that 30 million shoppers have joined the programme; half of those weren’t Kohl’s card holders, which meant the department store was attracting new shoppers.

Improving its merchandising efforts

Kohl’s also made an effort to freshen up their product presentation and in-store experiences. For one thing, the retailer started to invest more in national brands, rather than just private labels. In 2014, it created “super-sized Nike areas” in its stores, and this resulted in a 20 percent jump in comparable sales for the brand.

Kohl’s also partnered up with fitness gadget FitBit, and prominently promoted its activity and fitness trackers in enticing store displays, which helped deliver sales that were four times higher than expected.

Additionally, the retailer launched beauty sections in several of its stores to better promote its cosmetic products, and this helped them generate additional sales.

Timberland becomes more data-centric to refresh the brand

A while back, Timberland was facing some tough times. According to the Washington Post, the retailer’s revenue was flat from 2006 to 2012 and it was losing market share in the Americas. Not only that, but the brand had become stale and a bit confusing.

“Here in the United States, it had become something of a hip-hop brand as rappers name-checked ‘Timbs’ in countless songs. In Asia, it was thought of as a comfort brand; in Italy, it was more fashion-oriented,” the Washington Post noted.

But in 2014, things began to shift in a positive way for the company. Sales were up in every global market and category and margins were up to 13 percent from about 8 percent in 2011.

Timberland was able to accomplish their comeback by making improvements to a number of aspects in the business, including product design, marketing, and merchandising. However, at the heart of their efforts is the move to be more customer data-centric.

The company gathered data from thousands of customers and potential shoppers to figure out what made them tick. They sought insights on their lifestyles, preferences, fashion profiles, and price sensitivity.

Timberland’s research allowed them to figure out exactly the type of customers it should be targeting. The company discovered that it should be pursuing the “outdoor lifestyler,” a person who’s in touch with the outdoors but in a more casual way (as opposed to hard core outdoorsy people). From there, they revamped their products, marketing and merchandising strategies.

Some of the changes included introducing more fashion-focused items and incorporating more of the color black in its merchandising mix. Timberland also designed more “seasonless” pieces to attract shoppers year round.

In terms of marketing and advertising, the retailer shifted their messaging as well as the positioning of their products. Instead of just talking about performance and sustainability, Timberland made ads and collateral a bit more fashion and style-centric, to entice the outdoor lifestylers it was targeting.

West Elm introduced more personality into its products and stores

When Jim Brett started as West Elm’s president in 2010, the furniture retailer wasn’t doing so well. The company wasn’t profitable, it was closing some of its stores, and its merchandise lacked personality.

But as Fast Company puts it, when 2014 came along, Brett help bring West Elm into a whole new place. The company was seeing “double-digit comparable-brand-revenue growth” and its physical stores were at the center of the company’s revival strategy.

Here are the steps West Elm took to pull that off:

Revamping the company's product lines

To breathe life into its products, West Elm replaced its lifeless, “brown box” merchandise with more “statement” pieces that had a more global and feminine look.  “Brett sourced handcrafted textiles from places like Nepal, and he re-merchandised the stores and catalogs to convey a sense of creativity and discovery,” Fast Company reported.

West Elm also put more focus on American-made products, and unveiled a home goods spin off called West Elm Market, which sold at least 75 percent Stateside products.

Changing how the staff interacted with customers

In addition to refreshing its merchandise, West Elm also refreshed the attitudes of its staff. Sales associates were instructed to enhance their interactions with customers.

Rather than just selling to customers, employees were tasked to connect with them by talking about things that aren’t necessarily related to what they’re selling. They could recommend local establishments, introduce them to new songs, and just generally cultivate relationships with their customers.  

Strengthening communities through its stores

West Elm also conducted classes that customers could attend to learn new skills. Note that these events weren’t salesy in nature. West Elm wasn’t trying to get people to buy; rather, the retailer focused on improving their local communities.

But the good thing is, despite their non-promotional nature, Brett told Fast Company that their classes still encouraged customers to “come back more frequently and spend more.”

Bottom line

We hope the stories above were able to inspire and spur you into action! If you have other comeback stories to share (perhaps one of your own), we’d love to hear them. 

 Francesca Nicasio is a retail expert and blogger for Vend, an iPad-based point-of-sale software that helps merchants manage and grow their business. This article was republished from Vend's retail blog, where Vend talks about trends, tips, and other cool things that can help stores increase sales and serve customers better.

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