Home Textiles at Home Online
Carole Sloan -- Home Textiles Today, April 9, 2007
The latest internet explosion at retail seems to be engulfing the home area as well as apparel and other consumer products. It seems to have been happening in spurts over the last decade.
The news that Restoration Hardware will focus its efforts more on its "direct" business falls right in line with the energies that competitors like JCPenney and Federated already are putting into this selling channel. And Resto's efforts appear to be largely internet-directed, although they are dropping new catalogs as well.
Meanwhile, just last week, Federated's Terry Lundgren announced a new spending budget of $100 million to juice up its internet activities — a move designed to raise that segment of the business from $620 million in 2006 to $1 billion next year. It's a mighty hefty investment, but obviously one that Lundgren believes will create a surge for the company.
And already at Federated, macys.com appears to be surpassing the Macy's Home Store in terms of sales, assortment and service, market observers report. As with other internet retailer tie-ins to brick-and-mortar stores, macys.com offers a broader range and different price points from its siblings.
When Kohl's launched Casa Cristina last month, it showcased the bedding collection on the cover of its circular — but sent customers to its website to see the balance of the program.
As for Penney, when it hit more than $1 billion in direct sales in 2005, the home area accounted for more than half of the sales and quite a bit more than that in profits, company officials said. And the internet was a key player in that performance.
Specialty retailers like Crate & Barrel and Room and Board are using the internet particularly, as well as the combined internet/catalog marketing thrust, to serve customers out of their store realms — and to dentify real estate areas that would be potential successes for new retail locations. The Room and Board store in Manhattan's Soho district is a specific result of this strategy.
What the trend is saying to retailers large and small is clear: Get your act together now in terms of "direct" marketing — or be lost in the shuffle.
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