Talking Shop

Anthropologie: Selling a Lifestyle

Anthropologie doesn't sell merchandise-it sells a lifestyle. Founder Richard Hayne took lessons learned from his successful creation of Urban Outfitters, which sells hip clothing and accessories for twentysomethings, and transformed them into a concept where the focus is not on the fashion of the moment, but on merchandise that soothes women's souls while getting them to open their pocketbooks.

Anthropologie stores are a carefully orchestrated attack on the senses, from the French music to the aromatic candles burning to the rough-hewn signs throughout. Each retailing quadrant acts as its own island, displaying a theme and flavor all its own. Customers enter "The Washroom" and find exotic soaps, lotions, dispensers and even a medicine cabinet for sale. They step into "The Boudoir" and discover sumptuous sheets, duvet covers and pillows luxuriously displayed on a wrought-iron bed (also available for purchase). In fact, selling the props makes the stores seem as if the customer has uncovered a rare artifact-a piece that she alone can own.

The store flies in the face of traditional retailing: It focuses not on one category of goods, but on disparate merchandise that's centered around a theme. Books, clothing, jewelry and patio furniture can be found there. As market expert Jon Schallert of The Schallert Group, a management and marketing consulting firm in Sorrento, Florida, explains, "a 'controlled clutter' design works because it keeps the customer interested." He advises his own clients to display merchandise in an uncoventional way so the customer discovers the merchandise as if on a special treasure hunt. Anthropologie has mastered this strategy.

To foster originality in each of its 50 stores, Anthropologie hires two artists for every location to create art unique to that store. This helps bolster the image of Anthropologie as an independent, free-spirited retailer, not a cookie-cutter franchise.

Anthropologie's buyers are on a mission to scour the globe for interesting, relevant and unusual items for its core customer. They see her as a professional woman aged 30 to 45, well-read, well-traveled and well-educated, with a household income approaching $200,000.

And she is a devout fan. Customers spend an average of $80 per visit, leading to average sales per square foot of approximately $600-not bad for a store that is all about creating a mood.

Build a Bear Workshop: Creating a Relationship With Customers
Who would have thought creating teddy bears could generate revenues in excess of $160 million in 2002 alone? Founder Maxine Clark of Build-A-Bear Workshop sure did. Her strategy was to target girls up to age 12 and let them select, stuff, stitch and dress a teddy bear (or one of the other stuffed animals they offer). What's the goal? "To create memories," Clark explains.

Although bears start at just $10, souped-up versions with sound, clothes and shoes can ring the register at $50. By acting as a fashion retailer with seven changes of merchandise per year, the Workshop lures its customers back an average of five times per year, resulting in sales per square foot of twice the industry average.

One of its unique marketing strategies is the Build-A-Party concept: Host a birthday party, and introduce new guests to the franchise. The tactic creates contagious awareness.

As part of its tireless research, Build-A-Bear discovered its customers wanted to dress their bears just like themselves. And the No. 1 retailer the girls selected was Limited Too. The two retailers share similar demographics and are often retail tenant neighbors. In February of this year, Clark inked Limited Too's first brand extension, affording each retailer the opportunity to promote and sell the other's merchandise both in-store and online, providing innovative cross-pollination of customers.

The company also fervently embraces causes relevant to kids and animals. It is part of a partnership with the World Wildlife Federation and The Humane Society, donating a portion of its proceeds on selected merchandise. Retail strategist Whalin concurs with its philosophy: "The company that understands cause marketing today will do very well."

Lessons to Be Learned
What did each of these five retailers do exceptionally well? They transformed their brand into an experience. Translating the ESPN brand to ESPN Zone has provided an outlet for like-minded sports fans to share the excitement of a game. Tempting angst-ridden teens with macabre and sarcastic apparel has allowed Hot Topic to shatter retail records nationwide. Grabbing a cup of java at Starbucks has less to do with what's in your cup than with the relaxing environment. Stepping into the world of Anthropologie is like stepping into an international oasis, replete with faraway sounds, smells and merchandise. And creating a birthday bear at Build-A-Bear Workshop becomes a treasured memory.

Instead of trying to be all things to all people, these merchandisers zeroed in on a niche target and never looked back. They mastered the nuances of their demographics, psychographics and geographics to bring the right products to the right customer at the right time.

Your Services Are Required
Many a service professional has said selling a service isn't like selling a product, but isn't it? Try some of these tactics to help you bolster sales.

  • Use an expiration date. Virtually all retailers offer a coupon or promotion that includes an expiration date-the longer the time period, the higher the redemption rate. If you're trying to motivate your customers to act quickly, put a short timeline on your proposals.
  • Bundle your services. Using the Costco approach, price your services according to how many your customers buy. The more they buy, the steeper the discount.
  • Employ upselling. Retailers like Claire's, a fashion accessory chain, offer a surprise goody bag with every purchase for just $1 more. Nordstrom offers ties when it sells shirts and socks when it sells shoes. Encourage your customers to purchase more by asking if they need any additional services at the end of every contract.
  • Give a free sample. Cinnabon isn't the only company that can offer a free taste. Offer your customers a complimentary audit, in-home survey, evaluation or any other introduction to your services. And don't forget to give speeches in your area of specialty-the ultimate sampling technique.

Elizabeth Goodgold is Entrepreneur's "Marketing Buzz" columnist.

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This article was originally published in the September 2003 print edition of Entrepreneur with the headline: Talking Shop.

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