• United States
Executive Editor

Retailers poised for seasonal sales rush

Dec 16, 20025 mins
Enterprise Applications

‘Tis the season for retailers to test the brawn of their IT systems. In anticipation of shoppers buying online in record numbers, savvy retailers had moved earlier in the year to improve their Web infrastructures to handle the seasonal spike.

‘Tis the season for retailers to test the brawn of their IT systems.

In anticipation of shoppers buying online in record numbers, savvy retailers had moved earlier in the year to improve their Web infrastructures to handle the seasonal spike. Now it’s showtime for the likes of:

• Sportswear retailer Finish Line, which pulled its Web operations in-house and launched a new e-commerce platform.

• Apparel maker Vans, which enlisted a content delivery service provider to speed Web downloads.

• Gift retailer Lillian Vernon, which invested in Web tracking and acceleration products.

Ernst & Young’s Retail and Consumer Products Group is predicting that total holiday sales will increase 4.8% over last year – a better-than-expected growth, it says, given the economic climate and foreign affairs. Early indicators for the online realm bode even better, as comScore Networks reports online consumer sales for the post-Thanksgiving shopping week totaled $2 billion, or 34% more than for last year’s comparable period.

Ernst & Young also cites other factors that are positive indicators for the industry: Retailers have achieved better management control of inventories and operating expenses; most have improved liquidity; Internet distribution channels are growing robustly; and higher-margin, private-label merchandise is increasing market penetration.

Retailers aren’t known for spending IT dollars liberally. Their budgets tend to lag behind those of other industries such as high-tech and financial services. Gartner reports that retailers devoted an average of 2.4% of revenue to IT spending in 2002 compared with 8.9% among telecom companies and 6.6% among banking businesses.

But Gartner says retailers are starting to think more strategically about IT and will become more aggressive in their adoption of technology over the next few years. Huge increases in IT spending aren’t likely, but Gartner says the industry will make moderate increases in IT spending in 2003 with continual growth through 2005.

Retailers also will dramatically change how they spend their budgets, shifting to prepackaged software and away from custom applications, Gartner says.

One retailer with new investments in packaged software is Finish Line. The Indianapolis athletic retailer selected ATG’s Commerce software to run its retail Web site and Portal  product to improve communication among its 481 physical stores.

Finish Line had outgrown its old Web setup, which it outsourced, and took the opportunity to build a more robust infrastructure that it now manages in-house, says Kent Zimmerman, e-commerce director.

“We really found ourselves limited in what we could do” with the old site infrastructure, Zimmerman says. “We kept having to write code for every little thing we wanted to do.” For example, simply changing the rules about how coupons are accepted required weeks of code writing, he says.

Finish Line launched its new ATG-powered Web site last month. For customers, the platform translates into a more streamlined checkout process and more payment options, including gift cards. The new software also improves the site’s search capabilities, Zimmerman says. Finish Line plans to eventually use ATG’s personalization features to create customized offers based on user preferences and order history.

Sports apparel maker Vans and gift retailer Lillian Vernon sought to improve Web site performance in time for their busy seasons.

Vans is using Speedera ‘s content delivery network to speed download times.

“We knew that the Web site performance was too slow,” says Joseph Jenkins, manager of technical services for Vans. The company subscribes to Gomez’s performance-monitoring service, which revealed it was taking as long as 3 minutes for the entire front page of Van’s shopping site  to download. “Once we implemented Speedera, it went from 3 minutes down to 4 or 5 seconds,” Jenkins says.

Speedera’s network of servers stores Vans’ graphic-rich product and event content at the edge of the network. When a Web site visitor requests information, Speedera routes the request to the fastest, most available server.

Meanwhile, catalog veteran Lillian Vernon sees a potential cash cow in its Web site  after experiencing 70% growth in online sales this fall. With Web sales a relatively new area for Lillian Vernon, it has become the fastest-growing part of the business, says David Hochberg, a vice president at the Rye, N.Y., retailer.

To keep up with Web growth, Lillian Vernon chose Fireclick’s Netflame suite  of Web acceleration, monitoring and analytic products. The content acceleration engine reduces page download times to 4 seconds or less. Reporting tools track online visitor behavior and traffic flow, and a marketing module measures the effectiveness of marketing campaigns.

The feedback helps Lillian Vernon tweak its site design and decide which products to place where. “We sell 6,000 products – everything can’t be prominent,” Hochberg says.

Other retailers also have launched new Web tools.

• Men’s Wearhouse chose TrueSpectra’s Image Server to streamline its image publishing and maintenance processes. With Image Server, Men’s Wearhouse lets its customers make changes to Web site images on the fly, such as zooming in on a product photo. Image Server replaces static Web site images with flexible, dynamically rendered images. This saves the company from having to make and store multiple versions of a one graphic image.

• Neiman Marcus Group added a text-based chat application from LivePerson to The LivePerson technology, deployed as a service, lets customers ask questions and get instant assistance while they are browsing and without having to pick up the phone.

• Famous Smoke Shop deployed address verification software from QAS. The vendor’s QuickAddress Pro software helps catch address errors before products get shipped – and before the Easton, Pa., cigar and accessories retailer incurs fees from United Parcel Service, which charges $10 for every address correction.

• Ritz Interactive rolled out Endeca’s InFront search and navigation software across its 14 Web properties – which include and Ritz wanted one, integrated search platform that spanned all its sites and helped customers find products even if they didn’t know its exact name or spelling.