Williams-Sonoma's e-commerce revenues grew to almost 52% of total revenues in its fourth quarter 2016. Now the company is setting its sights on investing in the digital customer experience.
"We were early to understand the importance of e-commerce and we now generate almost 52% of our revenues online and we do so profitably," said President and CEO Laura Alber.
E-commerce revenues were up 2.2%, generating 51.1% of total company net revenues for the quarter, compared to 49.9% in the year ago-period.
"In our marketing, we are focused on driving an improved customer experience and further E-commerce growth," said Alber, noting the company has always had a high percentage of e-commerce sales thanks to its catalog heritage.
Now the parent company of the Pottery Barn and PBteen has launched its first Tango Augmented Reality application, as well as 3D room design and product visualization tools developed for the brands. And the company notes these tools are just the first of a suite of new products and site enhancements from Pottery Barn rolling out over the next year.
The smartphone augmented reality app "3D Room View" by Pottery Barn is powered by Tango technology from Google. Tango is a set of sensors and computer vision software that enables smartphone augmented reality.
3D Room View will launch with a focus on the living room and will add additional spaces over the course of the year. The app allows customers to either add products to an existing room, enabling them to see how new products will look with their current furniture and decor, or they can empty the room to start the design process from scratch. The app offers five living room features to start: customers can add, move and remove items, change the color of the upholstery or pillows, and zoom in to see details.
Customers will also have access to 3D Room View with the help and expertise of in-store design specialists at select Pottery Barn stores in the San Francisco Bay Area, with plans to roll out across the country.
The first 3D design and visualization tools launching this month on web and mobile include “Design Your Perfect Desk” for PBteen and “360 Spin” for Pottery Barn. With 360 Spin customers can view a Pottery Barn sofa from all angles, with 120 sofa styles available to start. With Design Your Perfect Desk PBteen customers can pick a desk and build a room around it, from the paint color on the walls to the accessories on the desk.
“Our brands have always been a source of inspiration for customers, and we’re excited to enhance that experience by introducing the latest AR technology and visualization tools to help customers design a room by envisioning how Pottery Barn products will look and fit in their actual space,” said John Strain, EVP, Chief Digital and Technology Officer of Williams-Sonoma, Inc. “Our vision is to offer innovative shopping and design capabilities across all Williams-Sonoma, Inc. brands, starting with Pottery Barn and PBteen this spring.”
Williams-Sonoma's Plans for 2017
The company says it will be implementing digital tools, such as next-generation product information pages and 3D product visualization, and increasing personalization, to deepen online engagement of shoppers. Which it may need to do as company sales fell 0.3% to $1.582 billion in the quarter, while comparable brand revenue in the quarter decreased 0.9% compared to 0.8% growth in Q4 2015.
"In 2017, we will continue to invest heavily in digital technology in a fragmented and evolving retail environment where customers are targeted by multiple retailers," said Alber. "We are investing in powerful ways to increase brand level awareness and convert awareness to purchase.
Alber said, based on 2016 successes, the company is investing "more than ever in advertising, specifically our e-commerce spend." It plans to build digital campaigns across various social media platforms to inspire existing customers and is increasing advertising investments in cross-brand initiatives like key loyalty programs.
Alber also mentioned the company is looking at buy online pickup in store, but didn't reveal any specific timeline for this.
There are also several staff changes in the works. Sandra Stangl, President of the Pottery Barn Brands, is resigning from the company on March 31, after 23 years of service. Her departure has brought on a restructuring of leadership of the Pottery Barn Brands.
Marta Benson has been named President of the Pottery Barn brand reporting to Laura Alber. Jennifer Kellor has been named President of the Pottery Barn Kids and PBteen brands reporting to Laura Alber. Jeff Howie has been named EVP, Chief Administrative Officer, of the Pottery Barn Brands reporting to both Marta and Jennifer.
Marta Benson has served as EVP, Pottery Barn Merchandising and Visual Merchandising, since 2015, and from 2011 to 2015, she served as SVP, Business Development. Marta spearheaded Williams-Sonoma, Inc.’s acquisition of Portland-based lighting and house-parts brand Rejuvenation in 2011, and led its integration and growth strategy for four years. Additionally, she conceptualized the internal start-up of Mark and Graham, the company’s high growth personalized gift business, which launched in November 2012. Prior to joining WSI in 2011, Marta served as CEO of Gumps.
Jennifer Kellor has served as EVP, Pottery Barn Kids and PBteen Merchandising and Visual Merchandising, since 2016. From 2011 to 2016, she served as SVP, General Merchandise Manager for Pottery Barn Kids, and from 2010 to 2011, she served in a similar role for PBteen. From 1997 to 2010, Jennifer held various positions in the Pottery Barn Brands organization.