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Payless went off. But that does not mean that DSW must follow



DSW's strong sales in November, December and January came at the expense of profits, the company reported Tuesday. DSW posted its fifth straight quarter with comparable sales growth, but the company lost nearly $ 46 million during the holidays, because it had to run campaigns to clean up its goods. DSWs ( DSW ) shares stumbled 15% after the company had made a surprising loss in the quarter.

Despite the rocky holiday, the shoe chain has attempted to adapt to disturbing changes in the industry and learn new tricks to remain relevant to customers. Nail salons in stores, a revolutionary loyalty program and children's shoes section increase DSW.

DSW has searched for different ways to expand its brand with its core women customers. Women shoes account for 69% of DSW's more than $ 3 billion in sales.

"They've done a very good job over the last couple of years honeying at their customer," said Sam Poser, an analyst at Susquehanna Financial Group. "They have a designer customer who wants a good price on some fancy shoes."

DSW has tried to add experiences to shops outside self-catering shoe holders.

In 201

7, DSW began testing nail salons in two stores in Columbus, Ohio. DSW hoped that women would come in for manicures or pedicures and stay after buying a pair of heels or sandals.

Spiker salons have increased sales and driven customers, including highly sought after millennial buyers, to make repeated trips to stores. So DSW plans to extend nail salons to five more stores in Austin, Washington and Dublin, Ohio.

DSW's other strategies have also resonated with customers. It launched a new loyalty program, DSW VIP, which gives members exclusive access to promotions and special events. DSW VIP has 25 million members, and customers in the reward program make up 90% of sales.

The rewards program is important because it gives DSW better insight into customers. The company discovered that more than half of the rewards have at least one child, so it decided to put children's shoes on all their stores.

  DSW adds nail salons to select stores to draw buyers.

"The reason we entered the children was not to sell children's shoes. It was to sell more adult shoes," said DSW President Bill Jordan told investors during a presentation Tuesday .

This plan has worked. Moving into children's shoes has helped the company attract more frequent visits from existing customers and reach new customers. Customers who buy from DSW's children's section spend $ 75 more per year than other customers, according to the company.

DSW plans to innovate, such as adding shoe repairs to stores and developing its own brands. It has also jumped into the booming CBD market and recently announced it will sell CBD lotions and conditioners in nearly 100 stores.

But the company will face major challenges, including increased pressure from discount chains TJMaxx and Marshalls. ) and Gunning for DSW's core customers with their own discount stores. Nordstrom builds rack stores, while Macy sets out Backstage in Macy's stores. Macy says Backstage is attracting new customers, which can be at the expense of DSW.

On Tuesday, DSW, which also owns the brand portfolio Camuto Group and Canadian stores The Shoe Company and Shoe Warehouse, announced plans to change the company's name to Designer Brands. The company's ticker will switch from DSW to DBI. The stores will keep the DSW name.


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