Focus on: Consumer-Centricity

Brooks Brothers is getting “back to basics” regarding merchandise strategies. The venerable brand is merchandising individual stores based on customer preferences and demands.

“We were running our business with a ‘cookie cutter’ approach, one that diminishes opportunities and efficiencies,” said Jon Westergreen, director of store planning, Brooks Bros., New York City, which operates more than 200 stores. “We realized that to maximize sales we needed to engage with the individuals we were serving. This included cultivating the names of each store and the inventory it carries.”

This epiphany sparked an organizational restructuring that commenced almost two years ago—a move that is helping Brooks Bros. streamline inventory styles and levels that coincide with consumer demand. Besides appointing directors of store planning who act as liaisons between specific stores and corporate, the chain also restructured its retail districts; previously grouped in 12- to 15-store districts, they are now bundled into groups of approximately four per region.

The new configuration enables store managers to share their merchandising insight with corporate so that marketing, financial planning and merchandising departments can support each group’s individual selling plans. To make this new strategy come to life, Brooks Bros. implemented analytical technology: the Advanced Allocation system from JDA Software, Scottsdale, Ariz.

The operation begins as Brooks Bros. loads weekly location category sales and inventory plans, style assortments plans and 78 weeks of historical SKU sales data into the allocation solution. The system’s algorithms analyze data and execute allocations based on a consumer-centric merchandising strategy that takes into account pre-planned store-specific assortments and sizes, selling tendencies and seasonal builds.

The technology has helped the chain easily revise plans and manage its shopper-focused strategy much more easily. Most stores have assortments that are between 70% and 80% similar in content and flow.

“Meanwhile, between 20% and 30% of the assortment is individualized by specific need,” said Linda Rooney, VP planning and allocation, Brooks Bros. “By having a way to differentiate shopper demand and assortments and add a ‘resort wear’ category in hot markets, for example, we have created a change that accounts for a sales trend between 10% and 20% better than previous years.”

Consumer-centric analysis is also improving the chain’s marketing campaigns. By enabling stores to provide the marketing team with information about upcoming events and merging this data with inventory allocations, the chain has been able to increase sales between 30% and 40%, according to Westergreen.

Brooks Bros. plans to expand its consumer-centric practices across all of its retail channels. By applying a consumer-centric strategy to its cross-channel operations, the chain plans to analyze size opportunities and style demand, for example, which will enable it to target its shoppers with merchandise regardless of the channel they are shopping through, according to Rooney.

“Our store managers and online consumer transactions will both give us insight into consumer demand, and the technology will continue to give us the intellect we need to understand the ideal assortments we need,” she explained. “It is a true balance of corporate culture and science.”