Pier 1 ceo: “We need to shout a little louder”
Dallas – Pier 1 Imports president and ceo Alexander Smith talked about the state of home furnishings retailing and the chain’s recent initiatives during yesterday evening’s first quarter analyst call.
Like other retailers, Pier 1 sees its customers migrating to e-commerce shopping. And while its direct-to-customer sales ordered outside the store (Pier 1 offers in-store e-comm shopping as well) jumped 40% in Q1, overall performance was below plan.
In a highly fragmented home furnishings market, promotional marketing is swamping other messages, Smith suggested.
“I think the discounters have certainly set the tone, there is no doubt about that and the marketing activities of the deep discounts – whether the online or the brick and mortar – their voice is very loud,” he added. “That is one of the reasons why we are pleased to be back on TV. We believe that we have a great story and great products and we just need to shout a little louder.”
Other key takeaways from the call:
• Pier 1’s share of the home furnishings market is 1% to 2%, “depending on what you look at the total addressable markets is being and so we gain and lose market share by just taking or giving a little bit of the market share to many different retailers.”
• Floor sets for the balance of the year will be more category-focused with fewer vignettes. Pier 1 wants to direct attention to products that are key sales drivers.
• The need to bring fresh and distinctive products to market at a faster pace “is one of the new realities of home furnishings.”
• Online-only skus will grow by an additional 25% in fiscal 2017 with further increases planned in future years.
• The soft bath category, which debuted online during Q1, drew positive results.
• Pier 1 will launch its online gift registry later this year.
For the quarter ended May 28, the specialty retailer reported a net loss of $6 million, compared to net income of $6.9 million in last year’s first quarter. Sales fell 4.2% to $418.4 million, with comp down 4.2%.
Source: Home Textiles Today