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Software Solutions > Interviews > B2B channels are a lucrative opportunity for apparel companies >

B2B channels are a lucrative opportunity for apparel companies

Madanmohan Rao interviews Mike Grasee, e-commerce director, Lands' End

While much attention in apparel e-commerce focuses on consumer sales, the real action may actually be in B2B sales - an area generally underdeveloped in the apparel industry of many emerging economies.

Lands' End (www.landsend.com), a leading U.S.-based direct merchant of apparel and luggage products, is also the largest online seller of apparel. Mike Grasee is the director of the Extranet B2B channel for Lands' End corporate sales. Grasee joined Lands' End in 1992; as former director of international business development, he expanded the company's reach to include more than 175 countries around the world.

Q: How are your B2B services faring, and how are you personalising them for your range of customers?

A:

Our B2B division - launched in 1992 -- today accounts for over ten percent of our overall $1.32 billion in annual sales, and targets nine out of ten Fortune 500  companies.

Offerings customised by our uses include club jackets with customised logos for IT company Dealer Information Systems, casual denim ware for trade show contractor Freeman Companies, and personalised T-shirts for public relations firm RMR and Associates.

 

After submission, users can discuss their artwork with a Lands End art specialist - online (via directly linked synchronised two-way chat) or via a toll-free call, an important hand-holding and negotiating feature.

Back-end software analyses the logo and immediately estimates the stitch count and embroidery price, which can then be faxed back and emailed to the business client for confirmation.

Q: What kinds of user profiles and customer service features are managed via the Web site?

A:

We have built custom stores which offer companies the opportunity to purchase our apparel with their logos on it. Relevant features of the site in this regard include:

Views of logos. We have over 200,000 logos on file that customers can view.

Registration features to store logos, shipping addresses and payment methods to make shopping fast and easy.

Online Custom Stores (OCS).  For our Global 2000 customers, we build their sites, host them, and provide whatever secured access to the site the customer wishes.

The OCS is good for the company because it enforces their strict brand rules.  For example, Saturn has very strict brand rules.  They allow a red logo on white garments and tan logos on blue garments. 

We currently have 13 OCSs, for such customers as Cisco, Saturn, BellSouth, Cellular One, RadioShack and Carolina Power and Light.

Q: How did you evolve this list of personalisation features?

 A:

Customers have helped us define our personalisation requirements.  For example, we held a focus group of a dozen key customers before we began design of our OCS.  We also undertake usability testing with customers to help give us ideas for improved navigation and new site features.  Last, we use surveys to help us identify new site features.

Q: What is the roadmap for evolving the architecture of the site?

A:

We want to have a universal view of our customer and provide the customer with a consistent shopping experience across all channels.  CRM is seminal to this.  The channels we do business on include aggregators such as Ariba and Commerce One, as well as other e-marketplaces. 

We need to have an architecture that is flexible and scalable.  Flexibility is the key in B2B transactions.  Our customers' needs change constantly and we need to be able to adapt to the customers' needs. We work with companies like Webmethods and IBM to create customised connections to Ariba.

Q: What kind of channel shift has taken place via the Net? What other customer behaviour changes are you noticing?

A:

Metrics we use to measure success of the Web site include sales as well as other transaction steps, such as proportion of artwork set up through the Web site and calls per order. 

For instance, over 50% of our customers send us their logo through the Web site.  This saves the customer both time and money. 

Reports indicate that our site posted Internet sales of $138 million this year, up from $61 million last year. According to the National Retail Federation, our site is the largest seller of apparel online.

Q: What kinds of legal and privacy issues arise in such a B2B context? How are you meeting them?

A:

Just like B2C, we need to ensure that all customers' personal data is stored in a secured, encrypted environment.  With OCSs, we also provide access to the site based on the customers' needs.  For example, the Saturn site is available on the World Wide Web so that the 400 Saturn retailers throughout the U.S. can access the site.  Other customers ask us to provide a secured link from their company Intranet to the OCS.  We test security on an on-going basis.  It will always be a top priority for us.

Q: What are some of your future plans for international markets?

A:

Future plans include expanding the B2B offerings to international clients in multiple languages (U.K. and Germany sub-sites already exist). The overall corporate Web site, however, will continue to be managed centrally, for reasons of security.

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The writer can be reached at madan@techsparks.com

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