Anthropologie finds success through unique in-store visual displays and experiences rather than traditional advertising. It spends 2% of sales on elaborate customized displays created by in-store display teams rather than marketing. This enhances the shopping experience and sense of discovery for its target customers of educated women ages 30-45, driving customer loyalty and sales. Maintaining this distinctive approach through skilled in-store display teams is key to Anthropologie's competitive advantage over other retailers and more important to its business success than adopting conventional advertising practices.
2. What brings you to Anthropologie? Visual Displays Merchandise Catalog Customer Service Atmosphere Affiliation with Urban Outfitters
3. Do advertisements for any apparel products and retail stores effect your buying decision? Would you shop at Anthropologie if they had advertisements?
4. Do you like or dislike that Anthropologie pays more attention to visual displays than advertising? If less attention was given to the visual displays and more given to advertising, do you think Anthropologie would be as successful as it is?
5. Anthropologie Background Philadelphia based chain store owned by Urban Outfitters Inc. Opened its first store in 1992 in Wayne, PA Currently operates over 135 retail stores in the United States One-of-a-kind and compelling shopping experience that makes women feel beautiful, hopeful and connected
6. Anthropologie Background Doesn’t operate with the conventions of most retailers Doesn’t interpret its fashion research fastidiously Doesn’t run major advertising campaigns
7. Target Market Evolved as the Urban Outfitters store’s grew up 30 to 45 years of age Suburban or ex-urban College or post graduate educated Married or committed relationship More than 50% of peer group have children Well traveled, well read, appreciate innovation, artfulness and good design Enjoy cooking, gardening, movie going and wine tasting
8. Buying aka ‘DIGS’ Each buyer equipped with its own unique style Scour the world to find the most unique items Operate in an almost entrepreneurial fashion 50% of stock is private label and 50% is market driven Stocks vast numbers of a few trends Buyer at Large: Keith Johnson
9. Merchandise Policy Outgrowth of its understanding of the target market Uses focus groups and customer surveys Each season the president, design staff, merchant staff, and visual team develop concepts together Usually several simultaneous fashion themes or stories
10. Merchandise Policy Success from identifying trends for customer and showcasing them in stores Set the mood in the store each season by creating a unique and varied store mix of apparel, linens, books, and furniture
11. Merchandise Policy Displays are changed several times during the 12 week cycle to keep the stores looking fresh Inventory turns 6 times per year and new products appear 4 days per week
12. Store Environment Extremely eclectic product mix reflecting a range of product categories, each one edited in a unique way for the season Price range from $4 bar of soap to $30,000 antique Apparel is priced at the better range Stores are densely and artfully presented
13. Store Environment Appeals to the customer’s senses of sound, sight, touch and smell Experience feelings of discovery and escape Does not encourage its sales personnel to come up to the customer directly and suggest merchandise for purchase Assumes customer is educated and caught up in the store experience enough to make up her own confidence purchase
16. Store Display Approach Company takes 2% of sales normally spent on advertising and puts it into store execution Every store employs two full-time display people Apparel concepts inspire display elements that are crafted at each store Unique merchandising approach been a worthwhile method for holding off competitors
17. Store Display Approach “Our visual philosophy is to make the store feel as if it's a one-off, to feel like it's the only one," "We capitalize on existing architectural elements. All of the stores have a similarity to them, but none are exactly the same.“ "We don't send specific direction on placement by item; it's more general direction about type of mood, color, silhouette, trend -- we create direction that supports those things," Kristin Norris, Creative Director
34. Store Display Concerns Customized visual merchandising approach difficult to manage across many units Current retail environment : strong competing chains, new customers and attractive print and TV campaigns All vying for the attention of the Anthropologie customer
35. Major Question Would Anthropologie benefit from cutting display persons in each store and putting more budget toward advertising?
36. Alternative #1 Cut display people and put money into advertising Pros Expand client base Cons: Lose uniqueness of stores Still need someone to create displays-who would now do this? May not be worth it – increased traffic doesn’t mean increased sales Increased traffic = increased theft
37. Alternative #2 Cut just ONE display person in the stores and put the money saved towards advertising/marketing Pros: There would still be one experienced display person Cons: Work load is too much for one person May not be worth it – increased traffic doesn’t mean increased sales Increased traffic = increased theft
38. Alternative #3 Have a visual team of 2-3 part-time associates instead of full-time Pros: Part-time associates are cheaper than Full time – money saved can be put towards advertising Cons: Part time employees may leave for a better job/benefits With having more people involved in the execution of displays, there may not be a cohesive look of the store
39. Alternative #4 Leave everything as is Pros: The company is successful already without the advertising The company keeps their uniqueness and competitive advantage in visual merchandising Keeps the loyal customer client base Cons: Not increasing client base through advertising
40. Our Response We believe Anthropologie should KEEP their store display personnel and forgo advertising practices used by other retailers
41. Reason #1 Its what makes Anthropologie unique "One of our core philosophies is that we spend the money that other companies spend on marketing to create a store experience that exceeds people's expectations. We don't spend money on messages -- we invest in execution.“ Glen Senk, Anthropologie president
42. Reason #2 They know their target market- and don’t need to advertise to everyone "Most stores cater to a broad base of customers or specialize in a product category. We specialize in one customer. And we offer her everything from clothing to bed linens to furniture to soap.“ Glen Senk, Anthropologie president
43. Reason #3 Unique approach draws customers in- and they stay to explore Have never advertised, yet customers stay longer in the stores than most chain shoppers Average visit lasts an hour and 15 minutes- some customers stay even longer
44. Reason #4 Customers are buying- and they spend more Average sales per square foot is over $600 Average customer spend per visit is a relatively high $80 Net sales in 2009 :$1.83 billion up 21.7% from 2008 Gross profit in 2009: $713,478 Numbers don’t lie!
45. Reason #5 They will never publish misleading advertising Many retailers create advertisements that do not relate to what is in their stores See an add for Gap with celebrities looking great and loving life, then visit a store and cant make the connection between advertising and product
46. Reason #6 Displays are not as expensive as corporate made displays- and therefore should remain as is Often created using recycled goods and are not expensive Another unique aspect of Anthropologie displays All 3 window displays made with recycled paper
