Ralph Lauren is reaping the rewards of its operational tech improvements.
The apparel company has rolled out RFID technology across its fleet to improve out-of-stock replenishment sales, and upgraded its in-store staff-optimization tools to increase productivity and service during peak periods. Both of these advancements contributed to 4% comp-sales increases in its North America retail channel for its fiscal third quarter.
The company is also rejiggering its marketing strategies to invest more heavily in digital and social channels, and made the decision to increase its marketing 16% for the holiday selling season. President/CEO Patrice Louvet said they were “encouraged by consumer engagement across generations through our campaigns and programs,” which included the “Every Moment is a Gift” campaign that ran in stores, online, in its wholesale settings and across social media.
In addition to its smartphone app featuring a 7Days/7Drops campaign with limited-edition products, Ralph Lauren also launched its own digital game and Snapchat holiday shopping filter during the period. As a result of these efforts, the company saw its total social media following exceed 40 million in the third quarter, including a 30% organic increase on Instagram.
North American brick-and-mortar sales grew 4% and e-commerce sales rose 6%, with the physical retail sales driven by an 8% increase in average unit prices, a reduction in promotions, rebalanced assortments and new market activations.
Sales within the company’s global digital ecosystem — encompassing its directly operated flagship sites, Departmentstore.com, pure players and social commerce — increased low-double digits for the period. Its North America directly operated e-commerce sales were up 6%, which Nielsen attributed to the company’s investments in mobile, personalization and site navigation.
Ralph Lauren’s wholesale channel, however, was less fortunate, dropping 8%, and Nielsen noted its focused on improving consumer experience within that channel via in-store refreshes, more marketing and moving into under-penetrated categories.
Louvet said the company sees an opportunity in North America to expand its DTC footprint through smaller format stores.
“As we look at kind of the next few years, and where we want to take the brand and how we want to drive interactions with consumers across the country, we do believe there are opportunities to expand the footprint so that the brand is better represented in a more dispersed way across the entire country,” he said, “all guided by our brand elevation strategy.”
Regarding the Coronavirus, the company has about half of its fleet closed in China, which amounts to about 110 stores. While Louvet said they’re monitoring the situation closely, he noted that China represents less than 4% of the company’s total business.