March 22, 2015

Lands' End Sales: 2013 vs. 2001

As you know, Lands' End went "dark" while it was fully owned by Sears. Having been spun off, we can now compare net sales and ad costs and the like, before going dark, and after emerging from the darkness.

There are two things worth noting here.
  1. Lands' End was not a promotional company in 2001. Lands' End became a highly promotional company by the end of 2013.
  2. Lands' End was a classic cataloger in 2001, with online sales being +/- 20% of the total. Lands' End was a classic omnichannel brand in 2013, with a presence in more than 200 Sears stores, and an e-commerce channel capturing the vast majority of direct channel sales.
The pundits tell you that you have to be promotional.

The pundits tell you that you have to be "omnichannel or die".

Given what the experts tell us, it should be a no-brainer that Lands' End experienced unfettered growth over the course of more than a decade, right?

Let's find out.

2001 Lands' End Metrics.
  • Total Revenue = $1,462,000,000.
  • Catalog Marketing Costs = $218,000,000.
2013 Lands' End Metrics.
  • Total Revenue = $1,563,000,000.
  • Total Marketing Costs = $199,000,000.

That's a compound annual growth rate of 0.6% ... you add dozens of e-commerce marketing channels ... you add hundreds of stores ... you add discounts and promotions that didn't previously exist ... you add dozens of social media channels ... and you add a fully functional and fully multi-channel integrated 24/7/365 website ... you add mobile. Heck, you've added a lot, don't you think? Shouldn't all of that nonsense result in a doubling of this business?

You do everything the pundits tell you that you have to do, or your business will die.

And sales don't increase!

I know, I know, you want to blame Sears. STOP IT! Sears / K-Mart combined still do north of $30,000,000,000 in annual net sales. Yes, thirty billion. THIRTY BILLION! Does your business generate thirty billion in annual net sales? So there's retail benefit via Sears that should lend itself quite nicely to the omnichannel thesis.

Lands' End, one of the great direct marketing brands of our time, an omnichannel pioneer, cannot grow by using pundit-centric omnichannel strategies. But you're supposed to implement omnichannel strategies or your business will "die". Uh huh.

Please think carefully about what you're being taught about success. Is it possible that you're being taught tactics and strategies that benefit trade journalists, vendors, consultants, and research brands far more than the tactics and strategies benefit our companies?

Focus on demographics, merchandise, and the story you tell the customer. That's where the profit is.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.

Alex Morgan (Yes, This Will Be About Merchandise)

When the USWNT Olympics Team was announced, all-time great Alex Morgan wasn't on the team. Nor was she on the four player alternate list...