Sell Tactics Lululemon, Coach and Gilt Groupe Share Secrets

Trend forecasting firm WGSN and Fashion Group International gathered four industry experts at Parsons The New School For Design last month to share key insights on communicating with a new generation of consumers. “Right now it’s not necessarily about making a sale, but creating a connection,” said WGSN retail and events editor Claire Hamilton, who also moderated the panel and identified five retail trends that permeate. Each brand took a different approach.

1. Empowering the Customer: With the current recession, luxury brands are attempting to be With the current recession, luxury brands are attempting to be portrayed as less-standoffish to attract consumers. Emphasis is also placed on regional trends. Loud, garish logos of five years ago are being re-evaluated. “We’re global and in China, people want a logo,” said Coach’s Penchansky. “In the U.S., younger people want their own identity.” Lululemon’s logo was one-and-a-half inches 10 years ago. Now it is three-eighths inches. “I can spot older garments a mile away,” said Schweitzer. “But people still want it.”

2. Community and Localization: Urban Outfitters attracts customers and keeps them lingering with a concept called Space 15 Twenty in Los Angeles. It has a bookstore, art exhibits, a flea market and ever-changing pop-up shops, along with its Free People and Urban Outfitters retail brands. A new concept called Lululemon Lab puts retail and factory space in one store in Vancouver. Consumers get to see pieces being made by 10 sewers on the premises. The retailer also has weekly events at every store, empowering store managers to become ambassadors and recruit their own yoga instructors. Coach took a localized approach during Fashion’s Night Out in September 2009, hiring a graffiti artist to create customized bags.

3. Experience-Driven: Retailers are pulling out all the bells and whistles just to get consumers to step foot into a store. “In the new American Eagle in Times Square, you can have your photo taken and it appears in Times Square for fifteen seconds,” said Hamilton. In cyberspace, it’s tougher to draw fast-fingered shoppers in. “We know that our younger consumers may have eight apps open while shopping, said Gilt Groupe founder Alexandra Wilkis Wilson. “At the same time they are also talking, Facebooking and double-shopping during a competitive sale.” The e-shopping site practices sophisticated exclusivity offering certain designer sales to clientele that meet selected criteria
4. Seamless: Hamilton pointed out Norma Kamali as a retailer that makes shopping easy and efficient by offering e-shoppers the option to Skype with live salespeople. Coach launched an iPhone gift finder for the holidays to reach the consumer on the go. “Now is the time to exploit mobile,” said David Carroll, a Parsons assistant professor and founder of the Center for Mobile Creativity (funded by grants from Nokia and Adobe). “In Japan, they don’t spend any time on a PC. It’s all mobile. You don’t pay with a credit card; you pay with your mobile provider.” Gilt Groupe tapped into Japanese mobile customers, offering subscribers a $25 reward to refer friends to the membership-based site.

5. Building Intimacy: Psychographics are emerging as often more important than demographics. Coach did an extensive amount of research before launching Poppy, their preppy and flirty brand. “We talked a lot about our customer,” said Raina Penchansky, vice president of global communications for Coach. “We know who she is and what her interests are. It’s a combination of magic and logic.” Lululemon doesn’t segment its customers, but rather targets an aspirational girl. “We want to know if she is running with an iPhone so that we can make the right size pocket,” said Deanne Schweitzer, head of global strategy for Lululemon Athletica.

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