Chico's Adds Phone, Web Orders to Give Customers Direct Options

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Chico's FAS Inc., Fort Myers, FL, a high-end retailer of women's casual clothing and accessories, is easing its way into the world of direct sales by allowing customers to order products by phone or online.


The company this year began accepting orders for products at its call center and through its Web site. It will advertise those shopping alternatives with a 1 million-piece mail drop in September.


The company listed its toll-free number and Web site address on the back of its June mailer, which was designed primarily to drive customers to its network of about 210 stores. In September, the company plans to display the phone number and Web site address more prominently -- possibly on all 48 pages of the mailer.


"Customers pushed us to do it," said Jim Frain, vice president of marketing at Chico's. "They called us and said, 'We get these great catalogs. Why can't we order?' They were annoyed, so we decided we'd better answer that response."


Chico's is gradually converting the mailers it sends out every few months into regular, monthly catalogs that advertise the company's new direct sales capability. The company had a Web site that was not e-commerce enabled and a toll-free number that customers could call for complaints or to find a store. In mid-May, the company turned its small help desk into a full-fledged call center and began accepting orders on its Web site.


"In our first full month, we had a couple hundred thousand dollars in sales," Frain said. "Considering we did no marketing whatsoever, we were quite pleased."


Sales and call volumes spiked when people began receiving the company's June mailer, according to Charles Kleman, Chico's chief financial officer. He said direct sales started out at $3,000 to $5,000 per day and jumped to about $15,000 per day when the mailer hit.


Call volumes went from about 1,000 per week to more than 4,000 when the mailer hit. Frain and Kleman expect the September mailing to generate even more calls.


The company's direct sales represent a small percentage of its overall sales, which totaled about $23.4 million in June.


The company's call center -- which was staffed by a maximum of five help-desk representatives before the company launched its direct sales effort -- was expanded to 12 sales agents in June and has room to grow to approximately 60 agents.


"I've found that … if you provide separate channels, your best customers will use at least two of them, if not all three, sometimes in the same week," Frain said.


Although the company is new to direct sales, it has been using direct mail to drive people to its stores and to communicate with members of its Passport Club, which is a loyalty program that gives customers a 5 percent discount and other benefits once they have purchased at least $500 in merchandise. Chico's has about 150,000 members in the club, and another 400,000 have signed up but have not attained the minimum purchase threshold.


The September mailing will go to those 550,000 people and an additional 450,000 prospects, making it one of the largest prospecting mailings the company has attempted.
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