Ann Taylor Credit Card Program: Multichannel Marketing Best Practice?

Ok all of you multichannel best practice mavens, here's one for you to chew on.

Ann Taylor introduces a credit card program, with direct mail and e-mail marketing of the card provided by Alliance Data Systems Corp.

Read the article, then let the audience know if you think it is a best practice to have a third party market a credit card for a brand like Ann Taylor.

Executive Comments From Leading Brands

Williams Sonoma:

• "We froze our merit increases for the year for our associates, while at the same time we reviewed every associate's compensation with the market and if they were not in line with the market, we did correct that." KH: Try being an employee with no salary increase and fuel costs rocketing skyward. Long-term, employees nationwide will have to find a way to organize or to gain leverage.
  

• "What we are always doing is looking at the productivity of the last catalog mailed versus the next dollar that we can spend on paid search, and over the past couple of years, we have been able to intensify the efforts in search and reduce some of the marginal catalog mailings."

• "We have eighteen million customers who have opted-in and given us their e-mail address". KH: To the e-mail community --- how do you craft an e-mail program, individualized for eighteen million customers? Any ideas?
  

Costco

• "We and Sams continue to be fiercely competitive ... and we are both in each other's warehouses more than once a week shopping key items."

Ann Taylor

• "Internet is a very profitable business segment for us. Within the Ann Taylor division it represents about 10% of the total division’s sales and something less than that for Loft."

Limited Brands

• "Although the Direct business is $1.5 billion, it is the fastest growing channel. We will continue to see growth out of that channel. What you are going to see is within the catalog business. We will not mail as many catalogs or pages. It will still be a heavily integrated web-based business. The community piece is continuing to build and how do you play within the community, which is a new marketing target for us. I think also how do you think about step size, like VS - you know we have VSPink.com and how we are linking that back to the mother ship, and there is some exciting things there. We started to test mobile commerce, and it is just beginning touching in the water so, it may not be a great experience but you get on your mobile phone and you can place orders and through Catalog Quick Orders. It is amazing how many people have already responded to that test. You are starting to see a lot of that in Japan. As our technology and zones continue to upgrade in the United States, I still think that there is some interesting opportunities there."

Urban Outfitters

• "Direct to consumer sales surged by 34% with just 3% additional catalog circulation, with all three brands contributing meaningfully to the result."

• "All three brands continue to innovate in direct to consumer business. For example, Anthropologie began shipping internationally last quarter, Free People introduced product reviews and Urban Outfitters expanded its use of video, generating more than 17,000 YouTube views on its most successful clip."

Macy's

• "The key there is that Bloomingdales.com has a huge potential and we think that that is where we should be investing our resources as opposed to the catalog, and it will have a minor impact on sales and no impact on profit as we discontinue that in 2009. ... We are expecting to do $1 billion this year in volume in our direct businesses and we expect it to continue to grow significantly from there."

Hillstrom's Multichannel Secrets At Lulu.com:

Retail Is Struggling

J.C. Penney merges marketing and merchandising functions across online/retail channels, then cuts 100 - 200 jobs. I'll bet that the 100 - 200 people who lost their jobs aren't big fans of multichannel integration.

Ann Taylor lets go of 13% of their corporate staff, 180 jobs amid a tepid retail environment. In addition, 117 stores will be closed.

Talbots to shut down 78 kids and mens stores. Sure this is old news, but it is reflective of what could be a widespread problem in 2008. This economic downturn could weed-out a lot of over-assorted retail square footage.

Eddie Bauer cuts 16% of its corporate staff, even as sales improved in Q4.

Home Depot cuts 500 corporate jobs, 10% of the corporate staff. Assume these are $75,000 a year jobs (including benefits). Take the $210,000,000 that former CEO Robert Nardelli garnered as part of his golden parachute, divide it by $75,000, and you are able to keep these 500 folks gainfully employed for another five years.

Dell plans to close 140 shopping mall kiosks.

Starbucks will close 100 underperforming stores.

If you are a retail real estate executive, you have to be wondering who the retailers are that will line up for the store locations made available by the great recession of 2008?

Old Navy updates their logo, and elects to move away from families, now focusing on a fashion-based twenty-something target audience.

Trees rejoice as USPS volume drops by 3% in Q1-2008.

Positive News: Multichannel Marketer Innovation

I'm going to start each month with good stories in the world of multichannel retailing. The good news could be about people, marketing activities, or strategies.

Here's a few things I noticed this evening on various multichannel marketer websites.

Ann Taylor has a nice "Trends" landing page. What I like is that Ann Taylor has a point of view about their merchandise. Ann Taylor competes in a very challenging market, with numerous direct competitors, and pressure from the high-end and low-end of the market. I like that they are trying to differentiate themselves from their competition.

L.L. Bean's homepage prominently features catalog requests and e-mail signup above the fold. When you have the type of traffic that L.L. Bean has, it is important to try to build a relationship with visitors. Bean is not shy about encouraging the random visitor to engage.

Visit the homepage of Urban Outfitters. Check out the upper right hand corner of the screen. If you don't have anything in your shopping cart, Urban Outfitters scribbles out the View Basket tab, circles the word "empty" on your shopping cart, and points an arrow to the cart. I visited the homepage, and noticed this immediately. Clever! Move your mouse along the links across the top of the page, and see what happens.

Gymboree has a survey on the homepage. Using the phrase "We Listen", they offer you the opportunity to answer four questions about what you think about their Easter line of merchandise. It would be fun to segment those who fill out the survey, and understand if the commenters are high-value customers, and then link that data to actual visitation, shopping cart, and purchase metrics.

At the top of Lane Bryant's homepage, you see two flags. If you are a Canadian visitor, you can click your flag, in order to see merchandise denominated in Canadian currency. It's always good to make your site friendly to our friends living north of the border.

Patagonia has the courage to publish a voluntary recall on their homepage.

Are there any multichannel retailers you would like to praise, multichannel retailers who are doing unique and innovative things?