chico\'s fas\'s ceo hosts analyst day (transcript)
Analysts called on ETExecutivesTodd Vogensen at 8: 30 a. m. on March 6, 2012-
Vice President, IRDave Dyer
President, CEO and director Murray
President of Brand
President of Brand
White House | black market Mary Lu KellySVP, E-
Executive Vice President, COOLaurie Van Brunt-
President of Brand
Martin\'s lover, Clark.
President of Brand
I\'m glad you were with us today.
We look forward to a wonderful day. .
The purpose of today\'s meeting is to give you the opportunity to hear from some of the key members of our management team to gain a comprehensive understanding of our business strategy.
Of course I have to do some housework before we start.
First of all, I would like to remind you that today\'s speech and forwarding --
Forward-looking statements bound and protected by the security territory declaration in the SEC document. These forward-
Forward-looking statements are influenced by factors and uncertainties that may lead to significant differences in actual results.
The company does not undertake to publicly update or review its forwarding-
Even if experience or future changes clearly indicate that the expected results expressed or implied by these statements will not be achieved.
So we leave an agenda on each of your tables so you can see the queue in the morning.
We will start with CEO Dave Dyer who will outline the company\'s strategy for you;
Each of our brand presidents and e-commerce executives will update you on their brand positioning, growth strategy products, and upcoming marketing and Kleeberger, our COO will brief you on the highlights of our distribution center redesign work, as well as an update on our global sourcing and batting cleanup.
Of course, we hope you enjoy the great products that surround you this morning.
Finally, just a few administrative logistics.
So first of all, if there is a broken sound on your phone, you will (inaudible).
In addition, we do provide you with Wi-
Fi login and password is part of the agenda that is in front of you.
So, please feel free to connect, we have a charging station on your left and you can use it if your electronics require a little energy boost.
The meeting is live webcast, so a presentation will be provided on chicosfas.
After the meeting.
Again, for those who are here, after the meeting, we will have a copy of the presentation on the flash drive in the background.
The bathroom is here for the last thing.
We don\'t have a formal break for lunch.
So feel free to use the facilities, or go out for a coffee or snack as needed, and eventually we\'ll bring all the speakers up so you have plenty of opportunities to ask questions.
At this point, we would like to continue the demo without a problem so we can finish the day and I would like to introduce our President and CEO Dave Dell.
Thanks Todd. Welcome to Fort Myers.
It was a great day in Fort Myers and we are glad you joined us in person or through our webcast.
As Todd just commented. -
Troy, it\'s too loud. Thank you.
I just said Oh Troy, he fixed it.
So, when he just reviewed, we have a great team here today for you, and I believe this is the best executive team in women\'s professional retail.
I am very proud to lead this team and thank you for the opportunity to show their talent and our business commitment.
Before I started my state of the union meeting with Chico FAS, I again highlighted our color of growth and set the framework for today\'s presentation, and I would like to briefly review the highlights of 2011. EPS of $0.
84, representing our third consecutive year of double growth of 31%
Earnings per share growth, comparable store sales 8.
2% capped three-
Annual stack 24%.
In terms of cash flow, our business, mainly stores, received a capital investment of $0. 132 billion for the first time;
$0. 213 billion get Boston properly create a positive contribution to its massive excess cash return shareholders for the first quarter totaling $0. 217 billion we are still $0. 248 billion liquidity and debt-free for the year.
It is important that the right leadership team is in place.
I have basically rebuilt my team since I became CEO, except to join our White House | Black Market President Donna in 2007, and everyone cheers for change.
At the end of today\'s meeting, I hope you will agree with me that we are fully prepared for the next phase of our exciting growth trajectory.
So let\'s start the federal FAS status of Chico.
Chico\'s FAS is a brand of nurturing that serves the lifestyle needs of fashion women.
Everything we do puts our customers first.
Our goal is to be the biggest customer.
A company centered on women\'s professional clothing, providing eye-catching fashion-
The right goods, provide the most amazing personal services, build deep relationships through all our interactions with our customers, no matter through what channels.
Our commitment is to optimize the great potential of each of our brands for continuous, double
Achieve digital growth by connecting with the lifestyle of the shopping channels chosen by our customers.
We will carry out our plan to drive excellence across all functions and set priorities to ensure we achieve our goals while we will create the most amazing workplace, by attracting, developing and retaining talent and adjusting our corporate culture, learning and growing around the following values, you see some on the wall over there.
Customers are our top priority.
Customer first, we expect to be honest and trustworthy 100% of the time.
We love fashion and everything we do.
We respect our colleagues, customers and business partners.
Our startup spirit makes our work productive. We like to have a good time.
Finally, we are committed to developing a culture of high performance across the company.
Now, a review of the pillars of our strategic growth plan;
First, the organic growth in providing the most amazing personal services of the trademark.
Second, develop innovative and creative marketing plans around a defined and ideal product target audience.
Third, through best-in-
Fourth, optimize the potential of the four brands.
I gave a detailed account of our domestic organic growth opportunities at the conference call on February 22, and today each of our brand presidents will further highlight their details in their presentations.
I just want to say that we are confident in our ability to open 120 stores annually in the country over the next few years and continue to be one of the few professional retailers that can grow significantly and make a profit in the US.
This brings us to the question of whether any of our brands have international opportunities.
If so, which country? Which brand?
What is time?
What is the size of the price?
What is the risk?
We do have some promising signs from our international online sales.
I\'m glad to share with you that we added [Rossman Kurt]
Join our team as vice president of international operations.
Rose joined us with oversight responsibility for the Middle East, Eastern Europe and Africa.
He is an international department of ours, moved here from Dubai and reported to me that since June he has started our efforts to determine the way forward.
We are in the first phase of the assessment, but early indications are that whether through our own organic development, strategic partnerships or franchising or e-commerce, our brand\'s strengths on the international stagecommerce.
We look forward to providing you with the latest information in the future as this exciting initiative unfolds.
The second pillar, innovative marketing;
Each of the four brand presidents will be discussed, including sampling a few TV shows and some of the behind-the-scenes footage we \'ve recently shot.
In addition, Mary Lu Kelly, our senior vice president of e-commerce
Business will introduce you to many of the activities she oversees, whether it\'s digital acceleration or gaining deeper customer insight by identifying individual customer behavior or more targeted communication or strengthening our loyalty programOur direct-to-
Consumer efforts are the primary goal of all brands to create first-classof-
Raise our awareness and maximize our opportunities
Channel customers. Multi-
Channel customers, as we discussed last year, you know our most important customers because they spend two to three times as much as anyone and only shop in a single channel.
We are organizing ourselves around this new reality to better serve our customers in the medium of their choice.
When we announced the right deal in Boston in August, I raised the company\'s online sales target from 20% to 15% because that acquisition allowed us to break through the lower target. The role of E-
The business of each of our brands is different.
Today, the Boston hotel is only available online.
With a small store, Soma needs a strong online product to get customers across the country, and of course our national TV supports that effort.
White House | black market customers are prolific users of all digital media.
Interestingly, what happens online when we do something like our recent TV commercials.
Even Chico\'s customers are using these online tools, and their usage is growing at a double rate. digit phase.
Our goal is to achieve 20% of total sales through our website in the next few years, each brand has its own unique goal and its own unique digital plan in the brand.
We will continue to invest resources in this important transportation construction program and we will be innovators in all media to further differentiate and stay away from our competition.
Our third pillar, the cost leverage, is the foundation of our ability to maximize the potential of each brand.
We are eager to provide the best servicein-
First-class shared services, whether it\'s infrastructure investment or technology distribution, can take advantage of our procurement department or use our human resources leadership to develop employees across all of our brands.
We will implement state-of-the-art tools and features for each of our brands, which no brand can afford alone.
We have done so much to achieve the sales and profit targets we set.
Kent will share with you two more important initiatives that we are working on this morning.
Last but not least, optimize the fourth pillar of the potential of our four brands.
Our strategic goal is to become a company with high performance brands.
What does this need?
In addition, it is really the first job to provide customers with the right, compelling fashion.
We need to provide it at the time and place she wants to buy it.
This requires savvy leadership, excellent operational execution and adequate capital resources to fund our strategic plan.
The company has four elements: fashion, savvy leadership, excellent operational execution and capital.
To ensure our success, we have also created a structure that allows each brand team to focus on real difference.
This is all about design, sales, marketing and customer relationships.
Brand President has full autonomy in these areas, can focus all their energy here, and believe that the shared service team I just mentioned will provide the necessary services at cost
Efficient, professional way.
Another key factor in our ability to focus and coordinate resources is that we focus only on women\'s clothing defined by Chico FAS as women over the age of 30.
In the United States, the women\'s clothing market totaled $108 billion, and professional marketing or professional clothing was nearly $40 billion.
This is a space we know very well and we intend to continue to know it better than anyone else.
Over the past three years, the women\'s professional clothing sector has grown by 5%, in stark contrast to our 11-year three-year compound growth rate. 5%.
In order not only to win the game, we clearly show our ability not only to win the game, but even in difficult times, we can really surpass and develop market care in this field.
In fact, this exclusive focus on women\'s clothing is an overall principle that guides our strategic path, as demonstrated by the recent acquisition of a very free brand Boston clothing, at the same time, it is also a unified element of our brand. all brands are in the same field, but there is still a unique difference between each other.
Our compensation philosophy is also a key factor in our success.
Our compensation program is designed to attract and retain talent, with a focus on pay by performance.
Our business needs must be aligned across the organization to drive growth in shareholder value through long-term and short-term net asset gains and returnsterm.
In 2012, we further strengthened our plan by canceling executive options and adding performance stocks based on RONA, 
Return on net assets
Set appropriate goals according to the brand, there is sufficient risk of compensation in order to coordinate the interests of management and shareholders.
My role in all of this is to set the overall vision for the FAS of Chico, set goals and priorities for each brand, allocate capital to the highest priority plan, and make sure not
Our shared service organization has managed the strategic activities well.
Ultimately, in the coming years, our expectation is that our actions will culminate in achieving the medium-term goals.
Through sales growth, taking advantage of the increased occupancy costs of the company and the store, increasing online sales for each of our brands, thereby increasing the operating profit margin of young people, by purchasing and reducing promotional price cuts, maximize profits and increase investments such as the recent proper and ongoing gross profit margin increase in Boston.
Our goal today is to share with you the major issues of Chico FAS.
Executing the brand with eye-catching products, experienced, savvy leadership team has brought huge growth and huge profit growth to our company.
I am sure you will find the following speech insightful.
Now, first of all, we don\'t do anything anymore, we are the brand president of Chico and the White House | black market, Cinny Murray and Donna Noce. Cinny?
I\'m Cinny Murray, brand president of Chico.
I\'m a woman from Chico.
I was born on 1957.
More than 4 million women join my generation every year.
£ 6,000 per day, over £ 200 per hour, approximately £ 4 per minute.
There are many new friends and customers who like it.
But there is more than the obvious.
Most importantly, our women are Chico\'s customers, the perspectives, wisdom and knowledge they have, and only with age and life-rich experiences, mothers, daughters, wives, friends of community members, workers, survivors;
Chico\'s woman lives her own life without a due date.
She is transitioning to the next part of her life with ease and achievement.
She defines her as, and likes to write her own story.
She was fully engaged in life, satisfied with her passion, and was not afraid of taking risks.
The clothes she likes to wear look and feel good because she knows that the style will not grow old; it evolves.
Our customers get the right to have fun, and the clothes she wears express her happiness and happiness.
Walk into any of our boutiques and you\'ll find it\'s more than just shopping.
This is the connection we share with our customers.
This is about friendship and relationship.
The relationship starts with a warm welcome to your door and we will introduce you to our special size if you are new.
Today, at our first-line boutique, we ask you to pick here-
On your slimming jean, our greetings are very strategic and make her feel like she has found a new home.
She came to Chico for that particular piece and wanted us to create a unique look for her unique personality.
There is no formula for the original design of Chico, the original printing, the original customer clothing of each customer.
Our brand positioning is: fashion, charm, passion;
We celebrate these values in our brand, in our customers, in our fashion, in the trend, to expressof-
A design designed to illuminate women wearing them.
We are committed to building personal connections through our most amazing personal services that inspire our customers to feel beyond the myth.
Our goal is to give her the feeling of confidence.
The most beautiful thing any woman can wear.
Chico\'s revenue is $2011 and total sales exceed $1.
2 billion up to new records, comp up 5% or 3-
Year comp stack 17%.
Three of our four quarters had more full-price sales than the previous year.
Yes, our customers dropped surprisingly in the third quarter from strong sales and the strongest sales and gross margin we \'ve ever had, but because she\'s sensitive to the portfolio, it\'s not that surprising
My team responds with speed and agility, which is part of my amazing machine.
We immediately cut our excess inventory in the slow category and repositioned our orders for the fourth quarter.
We took advantage of the environment in the fourth quarter to clean up excess products, as you heard on the phone, we cleaned up our inventory and started the spring with strong and fresh goods.
I am pleased to say that we will have another strong start in the brand of Chico in the spring, and I am confident that we will continue to gain market share from our competitors, as shown in our customer profile.
Our client profile grew to 7%, the highest level ever.
She responded to several favorable initiatives in direct mail, television and shops.
More than 60% of new customers have joined these brands through our first-line boutiques, and our winding machine design is original and no two have to look alike.
Each brand president of Chico FAS plays a different role.
I run the Chico brand with a vision and become the best in the class.
My financial role is to drive cash flow and support the growth of FAS in Chico and the growth of my sister brand.
They used to call me a cash cow. seriously, have you ever seen a cash cow with a lot of jewelry?
Thank God Pam is here and now I am cash fashion.
The brand of Chico is a well-functioning machine that earns more than $1. 2 billion. We deliver 14 [state sets]
The front line has mail every year, and the store has 12 new state episodes every year, ensuring the fresh flow and freshness of all parts of the brand.
In addition, we have created at least one monthly exclusive product for our online business.
No one in the Boomer arena can provide the fashion range of the Chico brand, so it requires a highly standardized, air-tight craft.
Chico\'s brand will be 30 years old next year, but we are just getting started.
We will continue to revitalize Chico\'s brand by expanding e-commerce, profitable store growth, social marketing and incredibly exciting products.
Chico\'s growth will come from four key areas.
First of all, our online business.
I am very optimistic about this channel.
Through our online purchases, our customers have increased by more than 25%, not to mention those who do research online and then enter our boutique.
This gives us an opportunity to both expand our product category and dazzle her in new ways to create exciting outfits.
Mary Lou Kelly will be introducing you to all of our exciting initiatives soon.
Our second area of growth will be real estate expansion.
Chico currently operates 683 boutiques and is likely to grow to more than 800.
We will open about 35 stores, 18 first-line stores and 17 stores this year.
We will close 5 boutiques when we leave the bigger and less efficient places, so a net increase of about 30 new stores.
We will continue to expand into the target market.
This is a very profitable place for us.
They usually pay for their investment in the first 15 months, and with our unique products, we become fashion destinations in these small markets.
Outlets is a very successful example of the brand.
We started to make a profit in the first year of delivering our products.
If you go to our branch, you will find that it is not a typical branch. formula].
Our fashion products make us very different from other retailers.
We currently have 70 of the world\'s 100 largest export centers.
Our final growth segment will be released through new and expanded products.
The accessories business remains the focus of the brand.
Jewelry is the first area to bring new customers of all ages to the brand and number one, bringing our last customer back to us.
We will continue to maintain a leading position in this regard.
I am very optimistic about spring 2012.
Our products look great on all three channels.
We are passionate about prints.
More than 40% of our merchandise is available in spring print on all three channels.
Chico customers like prints because they are original and colorful.
We design more than 250 original prints per month, 150 front-line boutique designs and 100 export department designs.
Women in Chico like color.
In the spring of 2012, we provided her with more than 50 new colors.
We have amazing colors at the top and amazing colors at the bottom.
We balance our colors with neutral and neutral this spring, they are female, fluid and wonderful.
The average customer of Chico is only 5\'4, but she is already voting for her right (inaudible)
As usual, the final style of Chico is the ornament, the beads and the pearls, which she cannot satisfy.
Praising all of our fashion, we quietly sold several key items in a stylish Chico way.
Like all fashion brands, product innovation is essential.
At this point, you may be aware of the success of the weight loss program we have registered.
We started in the cowboy quarter and I was happy with the results.
We will expand to other product categories earlier in the fall.
In addition, we launched our Black Label collection at 75 top boutiques online.
This series is designed for more boutiques and online consumers, far beyond our expectations.
These collection plans float between our monthly state collections, providing us with additional access to top consumers.
We are also testing the golf series for the green grass market.
This is just the beginning of many product growth opportunities that exist in the Chico brand.
Finally, and of course not least, I want to spend a few minutes on marketing.
Innovative Marketing and innovative products are equally important to brands.
I believe that over the past three years, you have noticed that the brand appearance and sound of Chico, mainly expressed for our emails and TV commercials, has undergone a dazzling transformation. We regard our (inaudible)
As a true fashion magazine, Meller targets a fabulous, valuable target audience that monthly fashion magazines seem to ignore.
As for the TV campaign we launched in the fall of 2009, we mainly use them to bring the fun, color and fashion that is unique to Chico to life.
Although most of our activities since then have been featured today, we like to mix it up from time to time.
It\'s worth noting that last holiday, as you may remember, we had an absolute class that offered a real idol to millions of women of different ages.
Diane Keaton\'s presence on our TV shows, emails, online and windows brings a lot of great buzz to Chico, attracting millions of existing customers and customers.
I love to end the filming of the behind-the-scenes video, which will let you know how wonderful it is to work with Diane Keaton on a pure work page, and then, we\'ll take a look at our current 30-second position, and maybe you \'ve seen it in the air, a campaign that started at the end of February.
This is also a departure for us as it only focuses on one product, new weight loss jeans and I will finish our last spring on accessories.
This is an exciting moment for the brand of Chico. [Commercial]
Donna cool good morning.
For those of you who I haven\'t seen and have no chance to know, I\'m Donna M.
White House President coraco | black market brand.
Today, I will introduce our brand to you, and I will introduce three aspects of our strategy that define our roadmap for the future.
First of all, what is the difference between the White House | black market and other specialty retailers?
Second, the growth potential of this powerful brand, and third, the key role marketing plays in supporting our growth and our unique brand status.
As you may know, the black market has been around for over 25 years.
Initially, a unique boutique concept, defined by a simple and effective palette, evolved from 2000 to a national retail chain.
In August of 2007, I joined the White House | black market as president, and my top priority is to develop a vision and future growth plan for the brand.
Then is the huge task of achieving my decision;
Build a team;
Build design and operational models to achieve the vision;
And implement the strategy in a very planned way, so as to achieve sustained and profitable growth.
While the first four and a half years were amazing, as the White House | black market has completely transformed into a vibrant growth tool for Chico FAS, this vision has become a reality.
It is our mission to make women feel beautiful.
Our faith determines who we are;
Making women feel beautiful is more than just selling clothes.
It includes understanding who she is, defining and living our values on a daily basis, and ensuring that the decisions of each colleague in the business are very clear.
I would also like to point out that the transition from specialty stores to brands is not easy.
It needs to develop a consistent voice, a unique, very recognizable style, to make a commitment to establish a continuous high level of execution and relationships with our customers and our colleagues, building on trust and credibility;
It\'s easy to say, but it\'s hard to execute.
White House | the black market organization\'s guiding principle is to always make the right decisions for our customers, and it is this commitment of our dedicated teammates that has led to an incredible surge in sales, profits and growth prospects.
So this reminds me of a very important point, what is the difference between White House | black market and other professional retailers?
Our unique approach is to deliver products, services and experiences that will be a replacement for designer brands.
We are affordable, safe and reliable, providing a platform for fashion women aged 30 to 55 to express their personality and create their own unique style;
Whether it\'s us or the good women we touchoutperform].
We have nothing ordinary.
Our product range is very unique, the detail design is highly refined, and the focus on quality and intrinsic beauty is never taken for granted.
We don\'t accept fend.
We add it to our customers with a unique and consistent vision.
Secondly, perhaps most importantly, we cherish the relationship we have established with our customers, and we insist on our commitment to truly make her feel beautiful in every interaction we have.
Our marketing is a reflection of our personality and is a perspective that captures the wonderful, wonderful creative wins our women and her desires.
It\'s not an impressive or distracting mask, it\'s a real representation of our brand.
Finally, the design of our elegant storefront is also different.
Crystal chandelier, spacious cloakroom, beautiful curtains and furniture.
Our boutique is not a biscuit.
Knives and times are usually designed to be unique to the community or to a particular shopping place.
Over the past few years, the migration of brands has changed.
In 2007, the focus of the brand is very, very narrow, only in black and white, mainly in the destination, when you have a special place to go, this is a place to go.
We are known for clothing and special tops, but the variety is not rich enough to grow and expand the coverage of the brand.
As we took the time to travel, hold focus groups and talk to customers, my vision for the brand changed.
It is clear that the White House | black market has a huge opportunity to expand its collection to attract a variety of women\'s lifestyles from leisure to work to dress up.
We firmly believe in our unique product approach, our value proposition combined with our unique customer service, will fill the niche in the market for women looking for a complete lifestyle brand they can rely on and trust.
After building the necessary teams, infrastructure, and a lot of research, we have gone along this path in the last few years.
First of all, I would like to highlight it as I know it is a very good question;
The role of color in the growth of our brand.
Our intention is to remain faithful to the brand\'s defined attributes, simple but unique color palette, keeping white and black.
That is to say, first of all, we listen to our customers and she obviously likes the surprises of seasonal fashion colors.
In 2008, we first introduced color in our collection.
Starting with that first color, our customers are very responsive and motivated to expand our range of choices.
Over the past few years, we have had a huge learning and have enough colors, but not a lot of colors can really push the incremental volume.
However, we are still working on our core DNA and carefully monitor the penetration of colors in each season.
The work bag has become a very successful entrance to the clothingto-work business.
Our goal is to design modular work clothes for busy working women.
The work kit allows to start with a new basic fashion piece, and then every season she can add novelty, mix and match and update her work outfit. Think about it.
We barely wore clothes a year ago. to-work business.
Today, we are a destination. for us, this is just the tip of the iceberg.
Our Recreational varieties have also expanded by increasing value.
Price and reposition our denim range.
The customer\'s response to our complete lifestyle product is very positive, as evidenced by our comparable sales results; up double-
Over the past two years, with the significant growth of new customers, the expenditure of our existing customers has increased, and the launch of new stores has been very successful. While wear-to-
On the basic value, casual workers of the type of work and value do not seem unique, and the way we design collections, merchandise stores and build customer relationships is not equal.
The reason why we are so successful and the reason why we will continue to gain market share is that we are focused on disciplined design diligence and customer focus and do everything we can to ensure every aspect of our products, our services and marketing are unique.
Our product design is complex and the series is well coordinated so women can build headsto-
Suitable toe choice for work, night or day play.
These works are processed and reworked to create fashionable and modern multi-functional clothing;
Never ordinary, always extraordinary.
The last but not least difference between White House | black market brands is the relationship we build with our customers.
When someone enters the White House | Black Market store, the experience is positive, memorable, and special to me, which is crucial.
Everyone should feel welcome and comfortable in our boutique.
Therefore, we strive to recruit the right people and train our staff to appreciate the lifetime value of the customer\'s relationship with the brand.
We are not traders.
We focus on the value of opportunity for everyone who enters our boutique, allowing us to create interactions far beyond the normal transaction nature of clothing retail and build meaningful and profound relationships with our customers.
So, back to the original question, how can we differentiate ourselves by expressing our vision in every single thing we do.
Through the series we offer, the shopping experience we create, and the real relationships we build with our customers, vibrant women, women feel beautiful and want a unique and affordable designer for women
Next, I would like to talk about our growth potential, which is something I am very enthusiastic and excited about.
With the establishment of the White House | black market, we have a very clear understanding of our niche and landscape, and we have also developed an efficient and profitable boutique base.
I am now leading a $0. 7 billion brand with sales up 18% per square foot, up 2010.
Now, we are ready to accelerate the pace of organic growth and achieve positive comp sales for 12 consecutive quarters.
Starting in 2011, over the next few years, I am very proud to say that the White House | black market will account for more than 50% of the company\'s newly opened boutiques.
We currently have 364 first-line boutiques in 27 stores, and as Dave mentioned earlier, we expect to grow by 600 to 700 in the future.
What is amazing is that it means that our potential is barely half played, which marks a huge advantage for the brand.
Regarding my vision for export growth, you know for those who don\'t know that I have quite a bit of experience and success with the export business.
During my tenure at Ann Taylor, I restarted their export operations and facilitated the transition to liquidation of export products.
So far, our focus in the White House | black market is to lay the foundation for the overall brand.
With this foundation, we are now ready to push forward export growth and fully deploy our manufacturing-for-
Today, about 40% of our goods and outlets are produced for outlets.
By the end of 2012, we plan to increase this ratio to nearly 60% and double the number of our chain stores.
Our early March. for-
The export products have been well received, and I am confident in our ability to design and produce high profits, to manufacture for export products, and to maintain the ability to use our outlet as a pressure release valve for first-line store goods, we are unable to effectively liquidate these goods on first-line or online.
As Dave now mentioned, the growth of export centres is accelerating.
So now is the perfect time for us to find the right brand location.
As the mall is more than 20 miles from our nearest first-line boutique, we expect to have the least number of crosses.
In the end, I predict that our export products will account for about 80-90% of the total portfolio, and can easily go to the export of more than 100 stores that we will develop in the future.
Mary Lu Kelly will talk more about our online opportunities in a moment, but I do want to mention, online is an integral part of how we intend to increase brand awareness and provide services to our customers whenever and wherever it is convenient to her.
It\'s not a secret.
Channel customers are very valuable and cost a lot more than customers who only buy boutiques.
Our experience will exceed every touch point of the brand.
So, look back at the three growth drivers of our future first-line boutiques, direct stores and online businesses.
The last thing I want to share with you today is to simply talk about our marketing strategy.
The White House in history | the black market has always focused on luxury fashion magazines.
With the growth and importance of digital media and the impact of social media, we have a new thinking about the distribution of marketing expenses.
In 2012, we will reduce our spending trends by investing extra money on social platforms such as digital marketing, Facebook, twitter, and television.
We have been successful in all these areas and are confident that our target population is active and engaged in all areas.
It turns out that our customers are highly involved on Facebook and our fan base is growing rapidly.
Our fan-only events and fashion editorials have been well received and brand loyalty and engagement have been established.
We continue to explore opportunities in the social arena, and as an example, we will launch a live chat between me and our fans on Facebook later this month.
We will continue to print and pay better attention to our ads to influence the largest number of customers in our population.
Building strategic partnerships with magazines like our current efforts at Marie Claire has been very successful in increasing brand awareness and gaining new customers.
Last fall, we tested TV for the first time. inaudible).
We are very satisfied with the positive impact of advertising on new customer acquisitions, so we will launch more important TV products this spring.
The ad began in February 20 for five weeks.
I will end with the ad.
But first, I want to summarize our commitment to continue driving sustainable growth and profitability over the next few years.
In the long run, our goal is to achieve sales of $1 billion, ranking first;
With our unique products and wider lifestyle appeal, stand out in the market and continue to deepen our relationship with our customers, expanding our influence through front-line boutiques, expand and online channels through innovative and innovative marketing and social media to increase brand awareness and connect with customers.
It\'s commercial now.
Last fall, we introduced TV into our marketing field.
I must say that the place we feel beautiful is a small part of the reason for the amazing performance in the second half.
Not to mention the welcome and very significant growth of our new customer profile.
This season, which started a few weeks ago, we gave you a whole new position and to be honest, they all laughed at me, but they still got me goose bumps, I want to say thousands of times now because I \'ve been replaying on my [Kego]
But it caused a huge stir in the fashion industry and women who often show up at night, and I replied to some women on Facebook who said before I like to watch your TV commercials, I have never heard of the White House | black market.
So this is great.
Its star is a very famous and mythical model named Coco Rocha, who actually started her career as a dancer, on blogosphere and social media
This is a celebration of our work package, which has been running on online prime time shows, indicative shows and cable networks.
I think you would agree that this is a shower, an example of how we can expand the White House | black market in the overall lifestyle of our customers, in this case, in the office
Please enjoy yourself. [Commercial]
Good morning, I\'m Mary Lou Kelly, senior vice president of e-commerce
Business of Chico FAS.
Today, I would like to introduce you to the three key areas of e-commerce that will continue to develop and differentiate our amazing brands.
First of all, there is no doubt that expanding online sales remains a key component of our brand\'s overall growth strategy.
Second, new and emerging marketing strategies will help this growth, including personalized mobile and social marketing. Third, we are committed to building the most amazing personal relationships with our customers, an extension of our most amazing personal services to increase customer loyalty and truly differentiate Chico\'s FAS.
One of the reasons I joined Chico is that I recognize that there is a huge increase in online growth no matter what life stage the brand is in.
It is important that, under the leadership of David, the advantages encountered by chance have been given priority, and what I bring is expertise in order to realize the unique potential of digital space, create compelling online shopping no matter how the channel interacts.
As you can see in this slide, online sales grew significantly from 2008 to 2011, with a compound annual growth rate of 40%. E-
The role of business as a shared service that supports multiple brands enables Chico\'s FAS to do several things.
First, recruit top talent, leverage supplier relationships, share best practices across all brands, and invest more in technology and online capabilities.
However, we do not want to give the impression that we have a one-size-fits-all focus.
We also balance the unique needs of each brand to achieve its goal of service fashion
Savvy Women enable them to shop and connect with our brands and each other in innovative and meaningful ways.
To do this, my team also has the expertise to work on each brand and immerse themselves in it.
With technology, we can build deeper customer relationships with our industry.
Leading loyalty database.
The point of proof is that we infiltrate more.
Channel customers have doubled since 2008. A multi-
Channel customers as only boutique customers and multi-boutique customers spend more than twice as much as the former
Channel customers spend more than five times as much as online customers.
So our focus is on building one of the bestin-
Customer Experience in 4 key areas;
Online marketing, on-site improvement, brand docking, seamless experience.
In online marketing in 2011 alone, we have implemented more than 40 new projects, including several new ones such as customer reviews, best reviewer programs and personalized welcome, giving up shopping bags and browsing marketing emails
In fact, the FAS of Chico has been named [Chita]
The champion of our email supplier [Chita mail]
For innovation and project implementation, we know that online marketing contributes more than 2 on average.
Boutique sales are five times more than online building and supporting the most amazing personal relationships.
For example, when we send an email to buy a search term, every dollar of sales it generates online helps to generate $2.
Sell £ 50 in a boutique.
I would like to highlight a number of projects and the value they add to our customer experience starting with customer reviews.
For Chico, this is Zenergy Cora animal Whirlpool vest and one of the comments that came with it, great vest, bought Vinny Carlyle Crop, a perfect fit with a white shirt, it looks clean in summer.
At the heart of the Chico brand and Chico clients, she is providing fitness advice.
White House | black market with stripes in the middle
Long dress and comments said, don\'t be afraid of stripes.
They listen to each other, which is more credible than we copy red, and don\'t be afraid of stripes.
In the second example, I never thought about trying on a nice top, but the salesperson convinced me that I loved it.
We found that when we launched customer reviews for boutique shopping in a few weeks, nearly 50% of the reviews came from customers who bought products in boutiques and then went to the website to see the products, so encouraged more
This is one of the Soma and the disappearing back bra, and the last line in the review summarizes it all.
I want to order another 4, just like it.
From the reviews, we launched a best review feature that will expand to other brands starting with the brand of Chico.
Our initial response to our best reviewers was that it was overwhelming to invite them to be featured.
This project not only recognizes the contributions of our best reviewers, but also gives other clients the opportunity to focus on this reviewer, which is not surprising, she is one of our best clients, this project has deepened our relationship with her.
The following is the current White House | black market homepage, which is based on website improvement and uses rich media to better convey the breadth of brand experience.
In 2011, we have made great competitive progress in website improvement and think our bestin-
The first-class website provides a great shopping experience for our customers.
The most important area for improvement is a comprehensive upgrade of our inspection. out process.
This experience is now easier and more convenient for all customers and registered customers
Now you\'re done with just two clicks.
We have also integrated several personalized suggestions on the product page and the checkout process of the entire website, once again building the most amazing personal relationship based on more in-depth customer insight and targeted personalized communication.
Another area of focus is the realization of features that will help customers better engage and feel the product.
The video showing how the skirt moves or where the skirt is makes these products come to life.
Let me show you the example of Chico and White House | black market.
Here is Ann in Valerie crochet vest, and you can see a short video showing how the dress flows and fits in person. [Commercial]
The White House here | the black market is a matte dress.
With the video, customers can better see how beautiful the dress moves and how good the fit is.
For the Soma brand, we have developed how to guide in the voice of authority.
The merchant who develops the product, who can best explain what a given bra is doing, how it is developed, and how to wear it.
Here is a video clip of a disappearing bra. [Commercial]
We have opened up our unique capabilities for brand initiatives (inaudible)initiatives.
For example, the features behind the scene involve customers in the world of our brand, such as this video clip in the current Chico book. [Commercial](inaudible)
Perfect shopping experience.
Customers use our website not just to research, view and purchase products, but in 2011, more than 400,000 customers looked online at product availability for a given boutique, nearly 2 million customers checked their convenient boutique location using our website.
I repeat and also take advantage of our fulfillment ability to locate, memorize and ship products that may be out of stock directly to customers for free, but not in a given boutique, but it can be bought online.
Thanks to the growth in online sales, many of you are asking why we continue to invest in physical stores.
The scale of the amazing returns we have made at our new store Chico may be unique as we find that our investment in any channel increases sales across all channels.
For example, when we open a shop, customers who used to be only online will eventually become valuable store customers, who usually spend more money online after opening a shop.
This is in line with our plan and our strategy is to fully integrate our shopping experience across the company to maximize our brand and sales potential.
We hope she can. look for]
Whenever and wherever she wants, our brand.
Looking forward, we believe that there will be new and emerging marketing strategies that will drive growth.
These game changers are real and have the potential to further strengthen the most amazing personal relationship we have with our customers.
The first is to personalize through customer insight.
Our knowledge of her will play a role in how, when and what we provide to her, thereby increasing engagement, frequency and loyalty.
This can be as subtle as the difference between new customers and passport customers.
Product category compared to enhanced passport benefits.
I can\'t emphasize it too much.
We believe that personalized will become more and more the advantage of all our brands.
The second area is mobile.
Mobile is the way we live now.
In the future, we will provide an online experience based on the behavior and needs of our customers.
Some traditional, both websites;
Some are mobile, some are traditional, both websites;
Tablets, phones, or who knows what\'s going to happen in five years and their different plans [front robe]
However, or all of these areas of communication, will be able to deliver personalized, relevant information to her in a near-real way
The time of her entire shopping experience.
When it comes to social marketing, you will notice that I have not used the word \"social media.
Life between social media, marketing and business is being erased.
Social media will continue to be a powerful marketing tool, and even in its nascent state, it has become a key element of our most amazing personal service.
However, we also believe that,
Business is real and can be maintained here, the bottom line is that our customers want consistency across multiple touch points, which will lead to a deeper real engagement with our brand.
What is the most amazing personal relationship?
Well, when I started retail and direct sales for the first time in my life, we mailed the customer catalog through a book, and in the world of Chico, she usually went shopping in boutiques.
When I started my career in E-
In the digital age two years ago, business and life still seem simple, and the site is largely just a trading site.
There is a new customer reality today.
We still send her books.
We emailed her.
Mail a few times a week
She uses Facebook, Google and her website.
She browses blogs and other destinations for shopping research and ultimately decides where, when and how to shop in boutiques or online.
In other words, what she wants, when she wants, where she wants it.
If a brand doesn\'t know who she is or how to provide her with the best service, she has the tools to find an alternative.
She also has family, friends and other people like her who are more credible than most of the ads targeted at her.
Therefore, the most appropriate thing for her and the successful brand is the more effective and effective integration of traditional and digital media, suitable for her wishes and behaviors, this is very important for how we understand her and integrate this knowledge into our marketing plan.
Marketing plans, messaging and customer contact plans are more personalized, relevant, and direct to her.
How and why is Chico\'s FAS unique in professional retail in building the most amazing personal relationships?
Fortunately, our customer capture rate of over 90% provides a very rich database of knowledge for our customers.
It goes far beyond simple demographics to achieve greater personalisation.
It is important that the DNA of our most amazing personal services has built the trust of our customers in our brand and our significant investment in data infrastructure and technology, we believe this will create a significant competitive advantage when she wants it, where she wants it.
So about online product opportunities.
We are also able to meet more product needs through the standard classification unique to our online products.
These opportunities vary from brand to brand, including products suitable for a limited number of boutiques, in addition to online products.
Products sold online are products that do not have enough space in the boutique to carry them.
For example, in these product lines in Chico, in addition to a certain length shortage and size expansion, we see the Black Label series online and in boutiques, an exclusive boutique.
In the White House | black market, we are often able to imagine colors as more silhouettes, and in Soma online we extend the brand to swimwear.
All in all, customers will always come, the way she sees the world, the way she sees the world.
Our ability to leverage technology to maximize the potential of e-commerce
Business is a key driver of our brand\'s overall growth, brand difference and building the most amazing personal relationships, and I am proud and excited by my efforts. Thank you.
Good Morning, everyone.
We remember some of your faces.
I will talk about our winding machine distribution center this morning, also known as the Aurora project, and then I will give you a question about (inaudible).
Therefore, the Aurora project is actually divided into two parts.
We will invest about $30 million in two distribution centers.
So the first part of it is DC-1 (inaudible). DC-
1 is the original distribution center of the winding machine campus, what we do there is to expand the picking channel, which will help Soma stay a little longer before June, so we will move them to Washington2.
Then we also improve efficiency by investing in fluid unloading and trucksto-
Build capacity across docks.
In addition to that, we have invested a lot of money, which will increase our ability to skip regional and centralized distribution.
Zone skip basically represents a set of packages for the FedEx system [outlet].
We can actually load loads of trailers and put them in other FedEx or BSO.
Full distribution is a method by which we send the product from the distribution center to the area where the store is located, which brings such things as Southern California (inaudible).
The core of the entire Aurora project is the real distribution center.
Basically, what we do there is that we spend a lot of money on automation to support directto-
The consumer business will also support the migration of the appropriate business in Boston and get a supplement from DC for our clothing brands --
Work with Soma business.
So basically, we designed configurations that really support our growth over the next few years.
So now I\'m going to take some time to see some visuals.
This particular photo, the first one is really DC-
1 receiving area, there are a lot of conveyors here, a lot of movable conveyors, which gives the flexibility of rest for the cross dock and direct transportation of products.
There are two reasons why the cross terminal is important, that is, how the distribution center can improve efficiency, rather than putting the product back in the warehouse and taking it out, and, since we will replenish our clothing brand outside of DC --
We have to do that, DT-
Instead, we have to position the product from DC. 1.
The next picture is just another picture, not the landscape truck
Load the program so you can see in DC-1.
Last slide of DC
1 represents the transport area.
We have scalable conveyors that we provide power, and we can actually move these conveyors directly into the trailer and load them directly into the trailer, so we get a little bit of efficiency there.
The other part of the project is that, as I mentioned earlier, we are also adding area skip and collection distribution capacity.
So now a little bit about DC. 2.
This is very exciting because if you look there about six to eight months ago, it\'s basically a warehouse of 300,000 square feet, there is about 200,000 more vacant space left, and now I can assure you that all of it is occupied.
The middle part of this picture is what we call the pick tower, which has three pick towers.
This is conducive to directto-
Supplement of consumer business and clothing business.
There are about 30,000 SKUs capacity per level, about 40 units per car, so we can zoom in on about 1.
Each of the three levels is 2 million units.
You will see that the screw conveyor is also affectionately referred to as the water slide, which basically transfers the pick-up module from the pick-up Tower to the main route starter.
The next slide is really the key and it\'s a bit ugly behind, but in the middle of the slide you can see that there\'s a long diagonal that looks like a bunch of plates.
This happens to be our cross belt sorter.
We chose the best variety I have seen, the Beumer cross band classification system.
Beumer, a company based in berkham, Germany, is close to duseldorf and they have hundreds of devices.
So the selection process is part of our due diligence;
We went to some of their installations and also to the factory in duseldorf.
Therefore, this sorting system is basically a 843 electrical configuration of the straight foot, which can be cycled and has a chute on both sides of the product belt.
There are five sensing platforms at each end of the sorter.
You can see the ones outlined in blue, which is why the project is inserted into the sorting system and delivered to the chute cautiously.
So the next slide is actually the chute itself.
Again, on both sides of the cross belt sorter.
It has two rooms and we can fix it directlyto-
Consumer goods, put it in, send it to the packing station, we have a huge packing mezzanine, put it on the electronic sorter, or we can put it on the sorter for processing, I should say it\'s the cardboard box, then put it in the box.
As far as DC is concerned, the last piece
2. this is a diversion of shipping.
So, as you can see, it\'s highly automated.
We also added extra capacity, like in DC-
1. Additional area skipping and collection allocation capabilities.
So now I want to continue with the global sourcing update.
As a result, I will collect four aspects as a global procurement strategy.
I believe you all know;
We have already said about Chinese immigrants.
Our next focus is on reducing the average unit cost.
Another part of our strategy is to rebalance the supplier portfolio to support migration in China and reduce our average unit cost.
Finally, I will update you on our technical support office in Asia.
So, on the next slide, this is the pie chart on the left, representing a breakdown by country of origin at the end of our fiscal year of 2010, and I don\'t have a 2011 figure yet, but we haven\'t really said it yet, but you can see that China is a big part of it, and 64% of our products in the fiscal year 2010 are from China.
Our goal is ultimately to reach about 40% to 45%, which you can see in the pie chart on the right.
I think the donors for immigration will be India, Indonesia, Vietnam, and maybe even other countries of origin in the Western Hemisphere.
So I can tell you that we are making significant progress in the fiscal year 2011 and I would like to say that our immigration efforts are on track.
The next thing is to reduce the average unit cost, and I \'d better summarize that by really integrating the supplier base and reducing the average unit cost, you know, that means more.
When we have been doing this for a few years, we are also working on how to take advantage of the purchasing power of the fabric, as well as on decorations and components.
In the fiscal year 2011, we began to see about $7.
The integration in these areas alone saved 7 million.
Another set of key products we study is also the first sales savings, and we work with some FOB suppliers who basically have to complete and really show the cost sheet, so, we only pay tariffs on the actual cost of the fabric, the decoration and the actual production cost, so we don\'t have tariffs on the overhead and all the other auxiliary ideas.
So we have some very good supplier partners.
We paid $3.
7 million fiscal year 2011, we look forward to expanding this scale in the future.
Of course, as I said, the other part will reduce the average unit cost (inaudible)
Migration, I think what needs to be kept in mind is that the reason why we shift our attention is, but there is a difference between the retail price and the cost of our purchase of the product.
But because the purchasing team can\'t control the retail business, their attention is shifted to really focusing on the average unit cost, and of course, their idea is to reduce the cost, unless there is pressure to improve the product or change the product mix, affect the overall average unit cost.
Rebalancing, supplier portfolio, this chart again shows the situation of all our suppliers in 2010, and the chart on the right is our target of 2014, I think all of you are very much our two main suppliers Mast and William E.
Conor has been a part of our business for some time.
If you look at the chart on the left, the mast is about 20%, William E.
We \'ve been talking about Conor for a long time, it\'s about 4%, and on the right, you\'ll see that we\'re already targeting about 25% of the business.
Connor will be about 10% to 12% of the business and we are injecting into each other another powerful supplier that hasn\'t been named yet, so the whole idea behind this is the same, when you make sense to a few people it helps with your average unit cost and I talked to someone earlier today.
From a purchasing point of view, the other part of my concern is not just the average unit cost, but to make sure you have the production capacity because we have to fight for it in some cases.
So if you can make sense to some people who can be sure you have the ability to solve this problem.
The last piece is the China Asia Technical Support Office.
Basically, we started in March 1 last week.
So far, we have three people on the payroll.
This is in cooperation and partnership (inaudible)
Therefore, we are currently using factory inspections from a compliance perspective as well as from the product and inspection process.
Our main goal is to improve the profit and efficiency of the supply chain, the reason why this office is important is because when you go to other countries, part of our immigration strategy, you will obviously go to the new factory, you need a technical support team that\'s kind of like a jump team that can help with these new vendors and new factories.
Over time, we expect the team to also focus on sample development, hoping that sample development will improve efficiency and reduce time in the supply chain over time, prepare for the approval process to provide the opportunity for the product to be redesigned during the production process.
So we are happy to open this.
It\'s not a procurement office, but it\'s actually more of a Technical Support Office on board, our suppliers and services (inaudible)
Especially when we try to produce new products and new products (inaudible).
So I think Dave will show up again.
Thank you for your attention.
Dave DyerWell, we\'re moving in now, and I\'m especially happy to hand things over to Laurie and [Tiro]
Who did such a great job in Boston.
These are two of our youngest people who represent our future growth engine.
I would like to provide a little background before I hand over the podium to Laurie.
On the screen here, we have pictures that have represented the brand positioning of Soma since the establishment of Soma.
Said we searched a few times, at most can only be described as an understatement.
As many of you know, Soma started as a subsidiary in 2004.
The brand of Chico, so the original name of Chico is Soma.
It looks rough and dramatic. the target customer is Chico\'s.
In 2006, we gave up buying Chico and switched to buying more items or basic products, again, which is not exciting.
2009 is my favorite though.
Our model sits on the top of the washer and dryer, showing features and techniques.
Obviously, it\'s time to move on.
When we came back, in fact, in the six years before the arrival of Laurie, we have changed the brand positioning four times.
When I started as CEO in 2009, I immediately understood something.