Retailer Drives In-Store Customers to Web

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Tossing channel-conflict fears aside, hat retailer Lids began a holiday marketing push this week to increase the number of its in-store customers who also shop on its Web site.

"Our 368 stores [nationwide] will be our marquee advertising strategy," said Ben Fischman, vice president of marketing at Lids, Westwood, MA. "We believe our stores are the most important place to market

"Our goal is to create a very seamless environment where our customers can interact with Lids instore and online. Lids' goal is to dominate all the different lines of distribution for headwear."

Under the initiative, the company has introduced a new online debit card, extended its affinity program to the Internet, debuted a winter promotion, tweaked its one-and-a-half-year-old site and added products.

According to Fischman, 80 percent of site traffic comes from customers of Lids' retail stores.

The debit card, named the Lids' Gift Card, replaces gift certificates, cash and credit for online and offline use. The card can be bought online or in stores in denominations ranging from $10 to $50.

Lids will support the Gift Card by extending its successful customer affinity program to online visitors. The Headfirst program has enrolled more than 1 million members through stores. An ongoing online promotion gives the eighth cap free for every seven bought.

Company research shows that Lids customers buy an average of 12 hats per year. The loyalty program will allow Lids to track its customers' purchases. The retailer will then e-mail these customers news of tailored offers and new products.

The WinterNet Holiday Game is another tactic to drive store traffic to the Web site. Store customers will receive game pieces encoded with a scrambled message that can be deciphered by holding the ticket up against the computer screen on the home page. Prices include a Jeep Wrangler, Apple Computer's iBook notebook computer, a Lids-branded watch and Lids Gift cards.

Such promotions will be complemented by a new user interface and enhanced back-end features to improve the overall visitor experience.

In addition, the number of items sold online has been jumped from 500 to 10,000. Lids stores, on average, stock between 3,000 and 5,000 items.

The Internet forms a crucial part of the 7-year-old Lids' multichannel retail strategy to remain the No. 1 seller in the $3 billion U. S. headgear market.

Lids last year recorded revenue of $130 million from the sale of 10 million hats offline and online. Fischman wouldn't disclose the contribution from online sales, adding that it was near the industry average of 3 percent to 5 percent.

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