Many Channels, One Customer

As a cross-channel apparel company serving a largely preppy clientele, Stamford, Conn.-based Vineyard Vines knows it must work to keep its customers happy and shopping.

Preppy still generally connotes well-heeled, well-educated and affluent, and these days you can add tech-savvy to the list of descriptors.

With 11 stores between Boston and Orlando, Vineyard Vines’ success relies on a robust and coordinated shopping experience, no matter the channel. Purchase online or from the catalog and need an immediate return? Bring it to the nearest store. See an attractive promotional price in the store? Apply that same discount to your online purchase.

Dave Ruback, Vineyard Vines’ information technology manager, says the objective is to keep all the selling channels in sync, regardless of how customers choose to connect with the business.

“We see them as one customer and not different customers in different channels,” he says. “It’s not that we want to lose the idea that there are single-channel shoppers who prefer to shop one way,” but the approach affords all customers the ability to “hop back and forth across channels … with ease.”

By 2014, more than half of all retail sales in the United States will be influenced by e-commerce, according to a March Forrester Research study, and selling strategies must account for consumers who desire to move between the offline and online worlds.

Understanding the customer
Vineyard Vines was founded in 1998 by brothers Ian and Shep Murray, who each left behind corporate jobs in New York City. Initially, they sold their distinctive neckties on the beach, in bars and on boats in Martha’s Vineyard. Its flagship store opened in 2005, and the company now leverages multiple sales channels along with distribution of its clothing and accessories for men, women and children in some 600 specialty and department stores worldwide.

In the middle of the last decade, Vineyard Vines underwent a technology upgrade to meld its various channels into a seamless mix and find new and innovative ways to reach consumers. In 2006, the company began swapping out its legacy enterprise resource planning (ERP) management system in favor of IBM’s WebSphere Commerce, used by major bricks-and-mortar retailers like Sears and Target.

Inherent in WebSphere Commerce software is the ability for retailers to compile and compare purchase histories of customers and use that data to develop specialized promotions – an opportunity right down Vineyard Vines’ alley.

“We realized that we were at a point where the [legacy ERP] system itself probably wouldn’t be able to handle more transactions,” Ruback says. “The volume also required a lot of customization as we grew into a full apparel retailer.”

By July 2008, Vineyard Vines had rolled out the base WebSphere Commerce platform throughout the enterprise, targeting its call center and order management processes. It migrated e-commerce to the platform last September; retail point-of-sale systems are slated to be moved to the platform this summer.

Vineyard Vines is already starting to see a fuller, holistic view of its customer base, Ruback says. Company managers, merchandisers and marketers now have essential information to drive more timely business decisions.

“As each stage [joins the platform] we are able to see the benefit by being able to help the customer cross those channels,” Ruback says.

Targeting customers where they shop
The demand for personalized shopping experiences is driving retailers to embrace new methods, says WebSphere Commerce program director Bill Holtshouser. Customers “want it perfect for them,” he says. “They are traversing back and forth between shopping channels and researching products online. This popping back and forth makes it hard for retailers to track their buying habits.”

Still, IBM has determined that retailers typically lose about 47 percent of sales to competitors during the cross-channel shopping process. Cross-channel “interaction points” whether on the web, TV or in print — “kind of fragment the journey,” Holtshouser says. “If you are a retailer trying to control all these messages to consumers, it is hard to do.”

Last November, IBM released the latest version of its WebSphere Commerce platform, which now fully integrates the mobile commerce channel and also allows retailers to tie in social networking.

The updated platform will help retailers reach potential customers regardless of how they choose to shop, Holtshouser says, and precision cross-channel marketing capability gives retailers the opportunity to quickly grasp customer-buying behaviors — and respond immediately with targeted promotions or other content.

The m-commerce component allows consumers to browse an online store, conduct product comparisons, view store locations and check inventory availability from their smartphones – all before committing to the purchase. Mapping technology can direct them to the nearest store, where their purchase will be ready when they arrive. Additionally, retailers are able to respond to queries through applications like text messaging or e-mail to mobile devices.

“It just gives the retailer more ability to establish a stronger relationship with their customers,” Holtshouser says. “They want to be able to have a consolidated view across channels.”

Vineyard Vines sees WebSphere Commerce as a foundational building tool to spur the organization’s long-term growth. “For us, it means managing it once and not in different systems,” Ruback says. “It means managing everything at the enterprise level regardless of the channel.”