Thursday, April 21, 2011
Dene Rogers, president and chief executive officer for Sears Canada Inc., speaks during the company's annual general meeting in Toronto on Thursday, April 21, 2011. - Dene Rogers, president and chief executive officer for Sears Canada Inc., speaks during the company's annual general meeting in Toronto on Thursday, April 21, 2011. | Nathan Denette/The Canadian Press
Sears shoppers make fashion link with Skype
MARINA STRAUSS — RETAILING REPORTER
TORONTO— Globe and Mail Update
Published Thursday, Apr. 21, 2011 12:13PM EDT
Last updated Thursday, Apr. 21, 2011 7:01PM EDT
An old-world retailer is embracing new-age digital tools in a race to woo younger customers.
Sears Canada Inc. (SCC-T19.58-0.08-0.41%) has introduced Skype technology in 10 of its trendy new fashion shops, allowing shoppers to get instant online feedback by modelling would-be purchases for friends or family on an in-store, 58-inch-wide screen!
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The Skype initiative is one of an array of Web efforts at the department-store merchant, which is among a breed of retailers that many experts deemed to be dinosaurs. But Dene Rogers, chief executive officer at Sears, is pushing hard to bring Sears into the 21st century, banking on the chain’s leading e-commerce position to give it a virtual edge.
“We’ve been looking to provide new technology to assist the sales process,” Mr. Rogers said at the company’s no-frills annual meeting on Thursday. It was held at the retailer’s head office in its flagship Toronto Eaton Centre store, just five floors up from the Skype setup in its fashion “modern shop.” “Skype is really the start of that interactive effort, allowing customers to communicate with friends and family outside of the stores,” he added.
Sears is rolling out other online capabilities, such as allowing customers to design their own furniture on the Web. And it’s looking at providing free in-store WiFi connections so shoppers can use their smart phones to check product and price information on the Internet.
The moves are aimed at drawing younger customers to Sears’ stores and e-commerce site, broadening its base of a mostly older clientele and bolstering its financial results. In a tough 2010, Sears online sales grew in the double-digits in its crucial fourth quarter, which includes the heavy holiday shopping period; in contrast, Sears’ overall revenue dropped more than three per cent in that quarter.
Sears and other department stores are trying to lure back customers lost over the last two decades by more agile specialty chains and discounters. Sears’ biggest challenge is spurring young consumers to consider it as a fashion shopping destination, said Jim Okamura, managing partner of retailing strategist Okamura Consulting in Chicago. “It takes more [than Skype] to dress that dinosaur up into something more contemporary.”
Mr. Rogers said Sears’ focus on a younger-minded customer is starting to pay off. “That customer is responding. I think it bodes well for the company that we’re able to play a role as a broad-based department store.”
His team came up with the Skype idea when brainstorming for ways to provide technology-driven interactivity in its modern shops, “sort of an Apple-like experience,” said Sears spokesman Vincent Power.
Sears’ research found that young women often shop in groups, with one of them considered the “style expert,” he said. The Skype concept is designed to connect the “style expert” with the customer even when they’re not shopping together, providing the shopper with an instant virtual opinion. “We thought this would reduce the chances of a customer waiting to make a purchase until she talked to someone whose opinion she valued,” Mr. Power wrote in an e-mail. “Now, she could get the go-ahead (hopefully :-)) right there.”
Samsung, one of Sears’ suppliers, provides the wide-screen television screens. They are in 10 of the 43 stores with the “modern shops,” which cater to younger-minded women with the retailer’s revitalized Attitude private label fashion line as well as trendy labels including Kensie, Calvin Klein and Buffalo. Sears plans another 35 of the shops at its 122 full-line department stores this year.
Already, the modern shop’s offerings and Skype online viewings appear to be resonating with young customers. In 2010, sales of brands in those shops grew 32 per cent from a year earlier, the company said. It added the Skype last summer, placing it outside the fitting room areas.
Mr. Okamura said that Sears can learn from retailers that tapped into early interactive kiosks about a decade ago. Neither staff nor shoppers used the kiosks much initially because they felt intimidated by them, he said. Sears needs to train its staff to encourage consumers to use its Skype technology, he added.
But he gave Sears full marks for developing an innovative and edgy way to try to engage younger people in the shopping experience.
Mr. Rogers said the company is assigning specific staff to take charge of each modern shop (and other in-store boutiques), tying their compensation to the results in their area. The company also poured more marketing dollars into touting its fashions, including billboard, magazine and television ads, he said.
Mr. Rogers is focusing on boosting Sears’ overall online presence and e-commerce. Last year, the retailer increased the number of items it carries on its Web site by 67 per cent, to 150,000; the number of its e-mail subscribers jumped 27 per cent and visits to its websites were up 2.4 per cent from a year earlier.
Now Mr. Rogers intends to add even more interactive capabilities for shoppers. “That’s exactly what we should be doing,” he said, “and we plan to do all that.”
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