Talbots re-ups DM commitment as part of strategic initiative

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DM may address retail woes
DM may address retail woes

A core element to the three-year strategic growth plan unveiled by Talbots Inc. this week includes steps meant to build up the company's direct marketing business.

A “significant growth opportunity exists in the company's direct marketing business,” said Phil Kowalczyk, COO at Talbots, during the company's annual investor meeting on April 1. A recording of the meeting was made available on Talbots Web site.

With this in mind, Talbots wants to enhance its multichannel marketing efforts for both the Talbots and J. Jill brands to enable a more integrated approach. This will enable it to do a better job of meeting the needs of the multichannel customer, who, according to Phil Kowalczyk, spends five times more than a single-channel customer. For this reason, investing “in direct can be much more powerful than mass marketing,” Kowalczyk said. The company ceased TV and national print advertising for the Talbots brand this year. That budget is being redirected to direct advertising for both the Talbots and J. Jill brands.

The three-year growth plan is the result of a strategic review that was announced last fall soon after Trudy Sullivan took over as CEO/president at the ailing multichannel merchant.

This year, Talbots will increase its prospecting efforts by investing $6 million in mailing an additional 21 million catalogs in 2008 for both brands, in an effort to build its customer database. Currently, the company's 12-month buyer file has 4.5 million names. Talbots mails approximately 127 million catalogs annually while J. Jill mails 78 million.

In addition, approximately 14 million J. Jill catalogs will be mailed into geographic areas where there is a J. Jill store nearby in order to build awareness and to drive results for both the direct marketing and retail businesses.

Kowalczyk said the company will also step up its search and affiliate efforts, areas where it has already seen some success, while significantly broadening its reach through Web marketing.

To support these initiatives, Talbots has partnered with Experian and is investing in a system to better manage its customer database and improve the accuracy of data capture and the ability to act on data. As a result, Talbots expects to do a better job of developing predictive modeling and make better investment choices with its marketing dollars.

Talbots will also overhaul the Web sites for both brands to provide an enhanced browsing experience.

The company is also investing in technology to support inventory planning and optimize markdown planning.

Other elements of the long-term strategic plan include a focus on delivering more compelling merchandise assortments, leaner inventories and plans to drive growth in Talbots Women, accessories & shoes, Talbots Collection and the J. Jill brand. Talbots will also pilot a premium outlet strategy this year. The company announced earlier that it would exit the children's and men's businesses this year.

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