Four seasons not enough for Pier 1
Cecile Corral -- Furniture Today, May 3, 2004
Pier 1 Imports is expanding its merchandise seasons to six from four to place better emphasis on the "summer" and "back-to-college" periods which the store sees as growing segments, the company said during the Lehman Brothers Retail Seminar last week.
"We always brought in Easter and summer merchandise together," said Marvin Girouard, chairman and CEO. "I think you all know back-to-school is a long period of time. back-to-college/ school used to be neatly packaged in a two week period of time. Now it lasts much longer, from late August all the way to October."
The company is also trying to swing its accessories business to 40 percent of sales from 10 percent at the cost of furniture, which once dominated at 90 percent.
"Accessories is now about 30 percent, and we'd like to bring it to between 30 to 40 percent," said Cary Turner, executive vice president and chief financial officer.
The company shared its merchandising initiatives for 2005, which aside from its new six-season merchandise program, includes: continuing to be in-stock on basic items; broadening its price-point spectrum to include entry-level and high-end ticket items; and building its "Special Finds" program with a catalog offering larger furniture pieces, rugs and upholstery, and two-week delivery, all to be implemented by August.
"(The Special Finds program) did well in about 100 stores last fall, and we feel excited about that potential and offering customers bigger furniture pieces for their homes," Girouard said.
Pier 1's merchandise sales mix is made up of furniture at 38 percent — a rate the company hopes to keep to make room for other items, such as decorative accessories, which occupies 24 percent, bed and bath products at 18 percent, housewares at 13 percent and seasonal goods at 9 percent.
Pier 1's products are all private label and are sourced from more than 40 countries. About 65 to 70 percent of the product is unique to the stores each year. Theme-wise, products are broken down into three groups — Trend, 10 to 15 percent of the total mix and very fashion forward; Style — 60 to 70 percent of the mix, Pier 1's "bread and butter, and it truly defines our brand," Girouard said; and Basic — 15 to 20 percent of the mix, targeting "a broader appeal, and always in stock."
Pier 1 is also growing the square footage of its stores by 8 to 10 percent annually, Turner said, from the 8,000 to 9,000 square feet the units used to be, to up to 12,000 square feet in major market locations.
This growth has spurred improvements in Pier 1's customer-service training and boosted its average ticket over the past 14 months.
Enhancing its marketing, Pier 1 will next month film one of several new TV ads, this one being shot in Florida — one of the chain's main markets. The ad will feature the company's new spokesman, Thom Filicia, decorator guru of the reality television program, "Queer Eye For the Straight Guy."
This new ad campaign —supported with print advertising that is more prolific than last year's efforts —launched March 11.
"That's been missing from our approach to the consumer," Girouard said. "We have the products, but the consumer often needs some information on how to better use our products, and Thom, I think, will be tremendous with that."
Furniture Today's Ray Allegrezza Speaks with Stephen Bogart about Fine Furniture's New Bogart Line