Apparel retailer Jos. A. Bank Clothiers Inc. is not unusual for asking customers to shop at www.josbank.com, but now, it wants the same potential online customers to buy company stock as well.
Starting next week and through the summer, Bank will distribute dual-message flyers in catalog or online order packages and at checkout counters at over 110 retail store locations nationwide.
The flyer itself is a glossy, four-color affair. One side says, “Shop online. www.josbank.com.” The other side cuts to the chase: “Now there’s another way you can appreciate the value of Jos. A. Bank. Call your stockbroker.”
“Our demographics are high-income consumers who are interested in investments, so there’s a fit there,” said Peter Zophy, divisional vice president of e-commerce at Bank, Hampstead, MD.
This appeal to buy online and also turn investor comes just weeks after Bank announced it had bought back 13 percent of its common stock for $3.1 million. It paid $4.50 a share, which is close to the current quoted price. The company’s stock has fluctuated between $2.25 and nearly $9 over the past 52 weeks.
Also, this development is a few months shy of Bank’s planned revamp of its site. New initiatives include real-time inventory availability, customer service e-mail and better search facilities.
In addition, the $16 million advertising budget for the store and catalog businesses will now include the Web site as part of a multichannel drive. Bank also will strike partnerships beyond existing deals with America Online Inc.’s AOL service and Fashionmall.com to drive traffic.
Tom Wyman, online retailing analyst at J.P. Morgan Securities Inc., acknowledges that Bank’s attempt to push traffic online in such a cost-effective manner is “a brilliant strategy.” But he doesn’t miss the wood for the trees.
What’s really going on here is that they’re trying to drive their share price up, Wyman said from San Francisco.
“The problem they’re running into right now is they think this is going to get a lot of activity on their stock,” Wyman said. “They’re probably mistaken because, unfortunately, right now Wall Street has turned to other sectors. So trying to pump an e-tailing angle right now with most of the smart money in Wall Street isn’t going to get them very far.”
Bank’s reasons in its flyer to visit the Web site are like any other retailer’s argument: convenience, secure ordering, complete selection, a satisfaction guarantee and an invitation to join the e-mail list for weekly specials.
The attempt to arouse consumer interest in its shares trumpets new store openings over the last four years, “thriving” catalog and e-commerce sales and increased brand recognition.
More importantly, the flyer states Bank’s ambitions of doubling the company’s size in the next five years to $400 million in annual revenue. Last year, sales were up 3.4 percent to $193.5 million.
E-commerce, currently 1 percent of company sales, plays a key role in the 93-year-old Bank’s quest for growth. Sales from the site are projected to grow to over $30 million by 2003, a forward-looking fact Bank doesn’t fail to mention in the promotional flyer.
“Hopefully, this marketing initiative will enhance our Internet presence and improve our stock price,” Bank’s Zophy said.