It’s one of the fastest growing specialty retailers in the country, but rue21 has been, by its own admission, a late adopter of digital retail technologies. Even though the company’s customer demographic mainly ranges from thirteen to thirty-four years of age, roughly 95 percent of sales come from its network of 1,200 stores. Brett Trent has been charged with developing more balanced revenue streams and leveraging digital innovations to benefit the entire enterprise.
To address these objectives, the chief digital officer has created four internal verticals: e-commerce, digital marketing, omnichannel, and customer insight, each with its own dedicated business leaders. “In addition to continuing our growth, my job is to demonstrate that e-commerce is just one part of a comprehensive digital approach,” Trent says. “Consolidating and coordinating all the related verticals under a single umbrella is the fastest, most efficient way to start developing that new understanding.”
Although rue21’s retailers have been quite successful with their more traditional approach, he has discovered that they are especially responsive to data, proving that the new digital tactics and strategies are important to integrate. For example, he has been able to demonstrate that every dollar spent on digital marketing programs generates more than four dollars in store sales.
His data-based approach has also helped bring about changes to rue21’s website, which has been redesigned to eliminate the traditional apparel merchandiser’s perspective (“Are you looking for a knit or a woven?”) to that of the consumer (“I want to see women’s tops”).
“Consumers care about the top, not what it’s made of. By the same token, we have to stop looking at how those tops are selling and start figuring out why customers might not be buying them as projected. To become ‘new retailers,’ we really have to start thinking from the customer’s point of view,” he explains.
He’s also focused on non-technical priorities, such as changing the physical layout of the company’s office. The leadership of all the digital teams now sits among leaders of the store operations team. This enables cooperation, collaboration, and interactions to occur on an ongoing basis, not just during meetings and through email exchanges. “It’s people—not technology or processes—that are essential in starting to integrate successfully. Their interaction creates constant exposure to each other and that leads to developing awareness and a single, unified team,” Trent says.
And this strategy is working. Within the first week of changing the staff’s physical proximity, the head of store operations overheard a conversation just outside her office among the digital marketers about an upcoming promotion. She was able to point out a problem that the proposed wording would create for in-store customers and suggested an alternative. That thirty-second conversation saved hours of confusion and follow-up after the fact, which avoided up to tens of thousands of dollars in lost revenue.
Trent believes it will take up to another year to reach the company’s digital objectives, but several current metrics are already showing tremendous success. In the past twenty-four months, there has been a 97 percent increase in traffic to rue21’s mobile and desktop sites, a 127 percent increase in conversion rates, and a 245 percent increase in return on ad spend over the last year.
“As we bring up those kinds of numbers in everyday conversations, key players start to understand how all the pieces work together and the ocean liner starts to turn,” he says.
Trent operates with core beliefs that might not be expected from a technology leader. He welcomes the “gut instinct” of traditional retail and seeks out and develops digital team members who have a foot in both worlds. “Perfect is the enemy of good enough, so you need folks who can make determinations that are 95 percent accurate based on 70 percent of the data,” Trent says. “You make sure they’re well-rounded and understand other functional areas, so they can make intuitive decisions.”
He also welcomes rue21’s “late adopter” status, because it has enabled the company to benefit from other retailers’ digital histories. By hiring professionals for his team who already have extensive experience and can identify mistakes before they happen, he estimates that rue21 has accomplished in two years what would have taken most companies twice as long.
He also believes that the demographics of the company’s core customers give it a competitive advantage. They’re already tech savvy, extremely mobile, and require little nurturing to move seamlessly between the store and e-commerce environments. Compared to customers using a single channel, Trent expects that the combined (omnichannel) value will likely triple or quadruple.
Looking to the future, he plans to uniquely leverage CRM capabilities. Rather than focusing on CRM’s typical applications—marketing and messaging or store experiences—that data will be used to inform rue21’s merchandising decisions. “Using customer behavior data to influence a single buy in one category across 1,200 stores, we have the potential to save millions of dollars,” Trent says. “By focusing early in the process on customers rather than merchandise reporting, the ROI difference can be staggering.”
Trent predicts that, within five years, digital marketing will generate ten dollars through in-store sales for every dollar generated online, and that e-commerce contribution will increase 400 percent. The company will also continue diversifying into emerging businesses, such as plus sizes and room and décor. “Spending patterns are always shifting, so we’ll continue to constantly reinvent ourselves,” he says.