Expanded Playing Field

Many retailers have pulled back from real estate investments during the economic downturn, but Columbia Sportswear is pulling out all of the stops in its transition from manufacturer to multi-channel retailer. From designing and opening stores to the launch of an e-commerce site, it is seeking to make its formal retail “debut” a strong one.

The “new look” of Columbia Sportswear is a far cry from its wholesale roots, and it was not a plan that the company undertook lightly. Armed with a strong balance sheet, it saw an opportunity to grab more market share “through real estate,” says vice president of retail Kerry Barnes.

“The idea evolved several years ago, but when we explored how to grow in a down economy, creating a retail presence still remains an opportunity,” he says. “Once the economy turns around, this will help us emerge even stronger and more competitive in the marketplace.”

The transition to multi-channel retailer also is driving the company to expand the breadth of its merchandise offerings in key metropolitan markets. For example, while shopping the six vast blocks that make up Chicago’s Miracle Mile, “you could not find one piece of Columbia merchandise,” Barnes says.

With but a single store as recently as two years ago and a network of outlets focused on liquidating excess inventory from prior seasons, “we were maxed-out on space,” Barnes says. “There was nowhere to go to find the breadth of our merchandise and educate the consumer about Columbia.”

This point truly hit home when the company began planning its 2010 lines. It was set to produce 8,000 SKUs, but even its largest retail customers are only able to carry about 1,000 SKUs per season.

Eager to re-brand itself in the marketplace, the company set a goal to open three prototype stores last November. Rather than leave its retail debut to chance, the company enlisted the help of long-time partner 2Hemispheres.

Here’s how it works: Columbia’s real estate team chooses the location, then works with the Portland, Ore.-based design consultancy to develop a macro-analysis of competitive markets and trends, including potential co-tenancy and shopper traffic patterns. 2Hemispheres also helps Columbia negotiate the best lease agreement and collaborates on interior and exterior space design – a new initiative for the growing retailer.

Columbia’s original outlets were such small spaces that the company effectively relied on rounders and four-way fixtures to display merchandise, and often it was a mass grouping of product.

New outlets will have more open spaces, and an emphasis on lighting will highlight collections and colors that “tell a story within our categories of business, including travel, trail, winter, water, golf, fishing and hunting,” says Cari Coyer, Columbia’s senior director of retail marketing.

Similarly, Columbia’s retail stores have their own distinct look, featuring materials like reclaimed wood and regional stone in the backdrop for the cash-wrap.

For merchandising, 2Hemispheres and Columbia analyze reports on sales turns, stock sell-through, product classifications, how merchandise should be presented in retail, and how much space should be allocated to each line. That data is used to develop a business plan that determines average stock levels and divides the dollars per item in the store.

Once each category is weighed out, the team can estimate how many units will fit on each fixture, and how much inventory to keep on hand in the backroom.

Preparation for openings
“We conduct weekly meetings of our teams to review analysis, ideas and plans, and ensure everyone involved in store openings is involved in the process,” Coyer says. “Everything that is placed on the store floor is run through these studies, from merchandising to in-store messaging, digital signage, fixtures and displays. It helps us create space plans and store sets so, when our operations team is ready to do in-store training and turnover processes, it runs smoothly.”

Merchandise isn’t the only star of Columbia’s new look, however: A combination of digital signage and customer kiosks allows shoppers to learn about merchandise and order out-of-stock items. On average, two web-enabled kiosks are located near the point of sale in each store, and digital signs are being used throughout the store to promote “energy and brand messaging,” Coyer says, “but our digital totems dive deep into our merchandise.”

Similar to totem poles, the digital fixtures display videos of merchandise research and development, as well as the technology used to create product. Retail stores feature two to five totems.

Columbia also is transforming its store windows into interactive billboards. Replicating the online experience, the digital overlay enables shoppers to use nothing more than a fingertip to stay in touch with the retailer.

“It features promotions, allows users to sign up for our loyalty program and browse merchandise,” says senior director of e-commerce Paul Zaengle. Stores featuring the 65-inch diagonal screens attract tens of thousands of users, he says.