Click on the link below or scroll down for this month’s top headlines and tekservePOS analysis and tips.

• How 'Tweet' it is
• NRF invites legislation to fight ORC Washington, D.C.
• Forever 21 set to open first wave of new stores
• The Buckle, Hot Topic, Aeropostale shine in apparel category

The new world of e-marketing

By Deena M. Amato-McCoy

Tory Burch was eager to speak with its loyal shoppers, but didn’twant to launch a loyalty program that would get lost among thosealready featured in the retail industry. By embracing crowd sourcingthrough a collaborative online forum, the retailer is connecting withloyal shoppers while managing to keep its marketing budget in check.

Even before the downturn, New York City-based Tory Burch wasinterested in learning more about what makes its customer base tick. Italso wanted to use this data to uphold their shopping frequency andmarket basket sizes. “We knew what she was buying, but knew nothingabout her,” Vicki Cantrell, COO and CIO, Tory Burch, said during theRetailConnections Executive Summit, held in Aventura, Fla., Feb. 18 to20.

“We wanted to know how and where else she shops, and how can we keepher as a loyal shopper,” Cantrell said. “We needed a way to leveragethis information and keep her connected to the brand.”

The chain achieved this goal by launching a “crowd sourcing” projectconsisting of a closed communication network that encouraged shopperinteraction.

In November and December, the chain sent thousands of e-mails anddirect main promotions, inviting shoppers to become a member of itsexclusive “Team Tory” community. The response helped the chain create acustomer base that exceeded its expectations. Cantrell declined toshare the specific number of members.

Next, the retailer partnered with Think Passenger, a LosAngeles-based company that offers on-demand platforms that combinesocial-networking, community building and collaboration technologies tohelp companies collaborate with shoppers in a private community.Members were invited to log into a dedicated, password-protected Website managed by Think Passenger, where they are asked questionsspecific to their thoughts of the Tory Burch brand, as well as theirpersonal style and shopping habits.

A database stored all consumer responses, and all results weredisplayed via Web-based dashboards. These dashboards feature graphsthat drill down into responses about specific topics. For example, amajority of its Team Tory shoppers make regular purchases atToryBurch.com. They also a very social group that tends to shop withtheir friends.

“Their responses taught us that our customer base is devoted to Toryand they also shared information that helped us capitalize on thatloyalty,” Cantrell explained.

For example, Team Tory enabled shoppers to weigh in on theimportance of some potential exclusive services, including advancednotice of promotions, campaigns or new lines, as well as in-storealterations.

“We provided them with seven choices and allowed them to rank the services in order of importance to them,” she said.

Their feedback helped the company invest in the proper services,“and not waste money on the wrong ones,” she said. “This informationallows us to be forward thinking. It is also an ongoing work inprogress.” -- TechTalk Tuesday, March 10, 2009

How 'Tweet' it is

By Samantha Murphy

Retailers are always looking for ways to communicate with customersonline, and social-networking sites are blazing the way. Advertising onsocial-networking sites is one option, but some retailers, such asDell, are leveraging networks to target promotions to specificshoppers. Twitter has become the retailer's network of choice.

Twitter is a micro-blogging service that is quickly becoming ahousehold name among consumers. Similar to Facebook's status-updatefunctionality, the service allows its members to send and read otherusers' updates, or "tweets," which are short text-based posts comprisedof up to 140 characters. Updates are displayed on the user's profilepage and delivered to other users who have signed up to receive them.

Realizing the impact of Twitter, Dell jumped on board in March 2007.To date, the Round Rock, Texas-based retailer has raked in $1 millionby alerting its 11,000-plus Twitter followers to sales items.

When Dell was ready to take its Twitter presence to the next level,it decided to reward its members with exclusive deals. Earlier thismonth, Dell began using tweets to "award" its social networkers withbig discounts, such as 30% off XPS laptops. Dell's Twitter followerscan see offers listed on their Twitter homepage.

"With over 11,000 followers, our team wanted to show its thanks tothe Twitter world through these new deals, which will continue eachweek," Bob Pearson, Dell's VP, communities and conversations, said in amessage to its subscribers on the company's Direct2Dell blog.

Dell's blog reported that the company plans to offer moreTwitter-exclusive deals moving forward. The retailer expects to use theservice to "build its follower base and ultimately influence sales,"the blog said. – TechTalk Tuesday, Feb. 24, 2009

As seen on tekBLOG:   Reading through the possible story ideas for this month’snewsletter, a common theme quickly emerged: e-commerce, e-marketingwith a little more e-commerce, and a sprinkle of Twitter. The digitalworld is no longer something people talk about and only a few aredoing. Now that everyone is doing it, it’s about who is doing betterand faster. In a recent blog, we talked about retailers needing to think outsidethe box and diversifying offerings in order to get and retaincustomers. The longer the recession goes, it seems that retailers areusing e-commerce, e-marketing and social media as the avenue of choiceto get shoppers attention. Read more at tekBLOG ...

NRF invites legislation to fight ORC Washington, D.C.

The National Retail Federation supports three bills introduced onFeb. 25 that can help law-enforcement agencies fight organized retailcrime.

Besides eating up $30 billion of retailers’ profits annually, ORC ison the rise as more shoppers are hunting for bargains in a sloweconomy. Customers may be unaware, however, that cheaper merchandisemay be stolen or tainted.

ORC rings typically target consumer items that are in high demandbut easy to steal such as infant formula, razor blades, cosmetics andgift cards, as well as DVDs, CDs, video games, electronics or designerclothing. Besides the financial loss, ORC can present a public healthhazard because items such as infant formula or over-the-countermedications might be improperly stored or mislabeled.

“Retailers that are struggling to survive are seeing their inventorydisappear in increasing amounts, and the goods end up at flea marketsor on the Internet at prices that put temptation into the path ofcash-strapped consumers trying to stretch every dollar,” said JosephLaRocca, VP loss prevention, NRF. “Losses from these crimes drive upthe price of legitimate merchandise at a time when consumers can leastafford it, and do serious damage to our nation’s already weakenedeconomy.”

In a move to fight ORC, three bills were introduced on Wednesday:the Combating Organized Retail Crime Act of 2009; the Organized RetailCrime Act of 2009; and the E-Fencing Enforcement Act of 2009. While thebills offer different approaches to combating ORC, as a group theydefine ORC as a federal crime for the first time.

They require amendments of federal sentencing guidelines forcriminals convicted of ORC, and require operators of online auctionsites to cooperate with retailers and law-enforcement officials intheir investigations of ORC. They also hold auction sites responsiblefor the sale of stolen merchandise that could have been prevented.

“This legislation shows that Congress is ready to stop treating theperpetrators of ORC like petty shoplifters and recognize them for theprofessional criminals they really are,” he said. -- ChainStoreAge.com, Feb. 25, 2009

As if the bad economy was not enough for retailers to deal with, another issue emerges: increased crime. A recent article “Retail Crime Up Thanks to Down Economy” found on Multi-Channel Merchant, highlights the Retail Industry Leaders Association’s 2008 Current Crime Trends Survey. Of the 52 major U.S. retailers that participated in the survey, which was released Dec. 1, 84% reported an increase in theft/amateur shoplifting; 76% reported an increase in financial fraud; and 80% reported an increase in organized retail crime. Retailers also reported a sharp uptick in robberies and burglaries in 2008. So the bills introduced by NRF could not have come at a better time. “Unlike simple shoplifting or other crimes of opportunity, ORC growth attributed to a slowed economy is less likely to decline as the economy improves,” RILA’s report states. “The criminal enterprises associated with ORC become reliant on the revenue derived from the commission of this crime and thus will likely continue to commit these crimes as the economy improves.” Click here to download the study.

Forever 21 set to open first wave of new stores

As many over-stored retailers continue to purgelocations, Forever 21 plans to open 11 stores in former Mervynslocations owned by Macerich by the end of March.

Shopping center developer Macerich purchased 39Mervyns sites in Dec. 2007, and two more locations in the first quarterof 2008. During an auction in Dec. 2008, Forever 21 and Kohl’s won ajoint bid to take over these sites.

The first of Forever 21’s Macerich-owned stores,which opened Feb. 26, is located in The Mall of Victor Valley, inVictorville, Calif. In March, Forever 21 will open five more stores onMacerich mall properties across California, Utah and Arizona.

The remaining six stores that Forever 21 plans toopen during this first wave will be in shopping centers across Texas,Arizona and California. These will not be in Macerich-owned properties.

"Our business is primed to execute significantgrowth this year in these large-format spaces," said Christopher Lee,senior VP, Forever 21.

The chain plans to open more stores throughout the year, according to a company statement. -- ChainStoreAge.com, Feb. 23, 2009

The Buckle, Hot Topic, Aeropostale shine in apparel category

Most apparel retailers continued to struggle in February, with somenotable exceptions. The Buckle posted a 21% increase in Februarysame-store sales, far above the 9% gain expected. Hot Topic reported onMarch 4 that its same-store sales rose 10.8%, more than double whatanalysts estimated. At Aeropostale, February same-store sales rose 11%,beating analyst expectations, as shoppers purchased spring merchandise.

Although most other apparel retailers remained in a funk inFebruary, the results, in most cases, were not as bad as Wall Streetpredictions. One of the hardest hit retailers was Abercrombie & Fitch Co., whose same-store sales plunged 30% in February due to muchweaker results at all its chains.

American Eagle Outfitters posted a 7% decline, less than the 13.4%drop forecast by Wall Street. The Wet Seal posted a 6.6% decline, lessthan the 12% drop expected by analysts.

Limited Brands, which operates Victoria's Secret and Bath and BodyWorks, posted a decline of 7%. Analysts expected a drop of 7.1%. StageStores said same-store sales fell 8.6%, less than the expected 9.3%drop.

At Gap, same-store sales fell 12%; Wall Street had expected adecline of 15.5%. Destination Maternity Corp. said its same-store salesfell 3.5%. --ChainStoreAge.com, March 5, 2009

Dunkin’ Donuts announces 15 new locations

Dunkin’ Donuts announced a multi-unit store development with Dunkin’Development of Greater St. Louis for the development of 10 restaurantsin the greater St. Louis area. The franchisee’s plans call for one unitto open by 2011, and the balance within the next several years.

Dunkin’ Donuts opened St. Louis for franchise sales in February2008, and has since signed a total of three store-developmentagreements totaling 34 units, although no stores are currently open inthe area.

The company also signed a development agreement with franchisee ChiYung Wang for the development of five units in the Savannah, Ga., area.The franchisee’s plans call for one unit to open in 2009, and thebalance within the next four years. -- ChainStoreAge.com, March 5, 2009

Since there are no billboards on the side of road saying such things as “Change is here,” “Retail sales are back,” and “Houses now selling in 30 days,” we have to look for the small signs that change is actually coming. As mentioned in last month’s newsletter, the news is slowly changing direction, but sometimes we have to take a closer look to see it. For example, the article above “The Buckle, Hot Topic, Aeropostale shine in apparel category,” is most interesting not because of the how well some retailers are doing in a bad economy, but that in most retail cases, revenue losses were not as high as predicted. While small, it’s a sign that things are slowly moving in the right direction. To help find and promote the positive that does exist, we will continue to use this newsletter as an avenue to highlight good financial results, positive growth and fresh ideas. Additional stories of interest from ChainStoreAge.com Cyber Monday Bloopers Cost Sales Target, Best Buy Launch Innovative Gift Cards Report: Online Shopper Satisfaction Remains Steady Report: Online Retailers Opening Stores May See Sales Drop

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