Industry News - September 11th, 2009
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RETAIL AND TECHNOLOGY
NEWS
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Borders Reduces Store Inventory by 50%
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Border is in the best shape possible to drive sales in the back half of
the year due to a reduction in store inventory and an ongoing store
redesign according to Ron Marshall, CEO of Borders. "The company
executed on an aggressive set of initiatives to reset virtually every
one of our stores, says Marshall."
For example, certain categories such as music, DVD and newsstand have
been hit particularly hard, therefore Borders has scaled back
tremendously on its multi-media business, music and DVD. It has reduced
store inventory by $150 million of retail which is approximately 50
percent less than last year. Additionally, unproductive inventory has
been moved through heavy promotional discounting.
Borders also announced that it has completely revamped its children's
section, increasing square footage by 20 percent. Borders doubled its
SKU count in toys and games with a focus on educational, creative and
imagination sparking items from brands such as Lego, Play mobile, Alex,
and Scientific Explorer.
Borders also is developing a "store within a store" geared towards
young adults. The store is stocked with young adult titles, graphic
novels and related non book items. The company is actively using social
media and unique in-store events as part of our outreach to teens.
"Everything we did in the second quarter to address these opportunities
and challenges was absolutely necessary, but disrupted our stores as we
moved categories, expanded sections, shipped out fixtures and replaced
inventory," says Marshall. "The important thing is that our stores
today are better positioned now than they were a year ago to drive
sales in the critical quarters to come."
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Price Chopper Synchronizes Yard and Dock Activities
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Price Chopper synchronizes yard and dock activities at its distribution centers with.
Retalix Yard Management. Retalix Yard Management is designed to
automate the yard and dock management process through predictive logic
and optimization algorithms. Using enhanced software engines and
visibility tools, RYM helps eliminate operational silos and coordinates
yard and dock activity with distribution center demand.
"The Retalix Yard Management system was very attractive because it
offered unmatched and real-time control over all yard and dock
operations in our distribution centers," said Dave Schmitz, director of
distribution for Price Chopper. "The solution will help us quickly
locate equipment, personnel and products anywhere in our yard, and will
greatly reduce trailer wait times - all of which means higher supply
chain visibility, efficiency and productivity."
Price Chopper will use radio frequency identification (RFID) technology
in tandem with the Retalix solution. RFID readers are being installed
at the entry and exit points of the
company's distribution centers,
and all of its fleet will be affixed with a rugged RFID tag, automating
the processing of arrival and departure information.
RYM was designed using the Microsoft .NET platform. The application is
part of the Retalix Transportation solutions suite, which is designed
to fulfill transportation requirements of inbound and outbound traffic,
yard management and dock scheduling for retailers and distributors.
Additional offerings include Retalix Transportation Optimization, which
provides freight management for planning, optimization, procurement,
execution, settlement, visibility and supplier control; and Retalix
Dock Scheduling, which facilitates dock appointment scheduling via the
Web, predicts labor demands, optimizes dock resources and streamlines
the flow of goods through the distribution center.
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Juicy Couture Launches Web 2.0 Community, Boosts Conversion Rates by 162%
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Juicy Couture leverages unique Web 2.0 community features on
JuicyCouture.com and now directs its shoppers to Club Couture, an
exclusive online portal that contains social shopping elements.
These shopping elements includes:
- Create a Look - Shoppers can mix and match outfits and accessories in
a virtual dressing room and browse through "looks" created by other
members
- Rate My Juicy - Shoppers are encouraged to upload photos of
themselves in their favorite Juicy looks, sharing how they "do Juicy"
with the rest of the community
The brand has implemented CTS/SOCIAL platform, part of CREATETHE
GROUP'S digital commerce software platform. Since implementing
CTS/SOCIAL, Juicy Couture has experienced a 162 percent increase in
conversion rates, 141 percent increase in page views per visit and a
150 percent increase in the average time spent on their site.
"It's important for Juicy Couture to have a central hub where our
customers can interact with each other, as well as members of our Juicy
team," says Frances Pennington, VP of Global Marketing at Juicy
Couture. "We've seen a significant increase in traffic and repeat
visitors since implementing social shopping and believe that this
community atmosphere has been integral in bringing the fun, Juicy
shopping experience online."
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Boycott Whole Foods on Facebook Begins to Lose Steam
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After shooting up to 33,200 members in just three weeks, Boycott Whole
Foods on Facebook has only picked up 1,000 members in the past week and
is beginning to trail off. Nevertheless, the current group is a
sizeable chunk compared to the Do Not Boycott Whole Foods which stands
at 4,300 members.
While 33,200 may not appear to be a lot of protesters compared to the
millions that shop at Whole Foods, the backlash the retailer now faces
in a media hurricane (social and otherwise) of Mackey's own making and
it is highly likely that the brand's reputation has been tarnished in
the short-term. Mackey's controversial statements have spread like
wildfire throughout popular social media Web Sites including Facebook
and Twitter as well as across major media outlets in a span of just a
few short weeks.
Mackey's comments and the social media aftermath is a lesson that all
retailers must pay attention to the power of social media and what is
being said about their brand. Whole Foods depends on the good will of
its customers and the social media uproar indicates it has taken a hit.
In time, Whole Foods can and probably will recover, but social media
sites clearly have delivered a big punch.
The Boycott Whole Foods Facebook page launched on August 13th, just a
day after John Mackey, CEO and co-founder of Whole Foods had
controversial remarks appear in a Wall Street Journal op-ed piece. The
Facebook page currently stands at 33,200 members.
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DemandTec Signs Business with Price Chopper, Ahold, RadioShack
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DemandTec offers insights into its next-gen solutions for retailers and
announced several key client wins including Price Chopper, Ahold USA
and RadioShack in its first quarter earnings call.
DemandTec's next-gen solutions combine category, brand, and shopper
insights into one system that provides a unified understanding of
shopper behavior and the ability to leverage those insights to make
better business decisions on pricing, promotion, assortment, and
collaborations with their trading partners.
According to Dan Fishback, DemandTec's President and CEO, the company's
next-gen approach helps retailers stop treating shoppers as statistical
averages. Instead, they leverage the digital footprints and the data
they already collect from every shopper interaction, and provide
DemandTec science to create actionable insights in an on-demand
offering. Several client wins that DemandTec announced in its first
quarter include:
Golub Corporation: Price Chopper Supermarkets, which
operates 116 supermarkets in the northeast United States, selected
DemandTec's life cycle price optimization solution, which includes
everyday price management and everyday price optimization software
services in the first quarter.
Ahold USA: The grocer plans to expand their use of
DemandTec's next generation solutions across all their retail banners
in the United States, including Stop & Shop and Giant Food Stores.
DemandTec's next-gen solutions will help Ahold USA leverage category,
brand, and shopper insight and execute merchandising and marketing
strategies by anticipating the needs of the customers they serve.
RadioShack: Consumer electronics retailer, which has
been a DemandTec customer since 2003, renewed its agreement for
next-gen software services that allow for merchandising and marketing
optimization solutions that can help better understand, attract, and
serve their customers.
Additionally, with the acquisition of Connect3, DemandTec has renewed
maintenance agreements with certain former Connect3 customers. Several
retailers renewed their advertising and marketing execution or AME
software maintenance agreement with DemandTec as the company develops
its end-to-end promotion management solution.
BJ's: Four Ways to Improve Operational Efficiencies
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BJ's outlines four ways it is improving operational efficiencies in its
most recent financial quarter. According to Laura Sen, President and
Chief Operating Officer of BJ's, the retailer is committed to the
following:
1. BJ's continues to build proficiency in its processes for ordering
and replenishing perishable foods. Presentations have improved
significantly and BJ's has reduced shrink and salvage, resulting in
better freshness for its members every day.
2. The loss prevention team achieves a substantial savings in shrink
reserves during the first half through the implementation of new
processes and procedures. BJ's already has one of the lowest shrink
levels in retail, less than 25 basis points of net sales, and the
company's loss prevention team achieved similar results in last year's
first half.
3. The company improves operational efficiencies in distribution by
completing the implementation of a new warehouse management system in
its Jacksonville, Florida distribution center. The new system, which is
now fully operational at all three distribution centers, helps the
company accelerate inventory flow to the clubs and gives better
visibility of inventory.
4. BJ's transitioned to a new data center provider with a selection of
Witpro Technologies as its business processing partner. The
relationship will allow BJ's to leverage Witpro's global infrastructure
management experience and IT best practices.
Total sales in the company's fiscal second quarter decreases 5.2
percent to $2.51 billion, compared to $2.64 billion last year. However,
BJ's remains focused on chain expansion, which Sen says is key to the
company's growth strategy. BJ's plans to open as many as seven new
clubs this year.
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