“Our goal is to be seen as an e-commerce-led company that sells a great lifestyle brand. We will work to become more agile on our online platforms, adopting a test-and-react culture that will enable us to best meet our customer’s needs,” he said last week on Lands’ End’s fiscal fourth quarter earnings call with analysts. The retailer is No. 44 in the Internet Retailer 2016 Top 500 Guide.
The apparel retailer, which spun off from Sears Holdings Corp. (No. 14) in early 2014, has its work cut out for it as sales declined across the board in fiscal Q4 and fiscal 2016. Direct sales, its largest channel and one that includes e-commerce and catalog sales, fell 2.6% in the fiscal fourth quarter ended Jan. 27, and 5.0 % for the year. Store sales also declined due to a decrease in same-store sales and a reduction in the number of Lands’ End Shops in Sears stores.
“We saw sequential improvement in our fourth quarter results, attributable to recent initiatives across merchandising, marketing and e-commerce,” Griffith said, though he did not specify those initiatives.
“We’ve already begun to take tactical improvements, but given the increasingly dynamic nature of our online business, we’ll need to be more diligent in improving our online experience,” he said, according to a Seeking Alpha transcript. “To accomplish this, we will need to augment our team, bringing in expertise to help ensure we maintain an e-commerce business that is ahead of the curve and create a best-in-class digital organization.”
Griffith is the third CEO of the company since it went public and separated from Sears in April 2014. In February 2015, Federica Marchionni replaced Edgar Huber, who had been CEO since August 2011, and Marchionni, who previously was president of Dolce & Gabbana USA, resigned in September 2016.
“In recent history, the company lost traction as it lagged behind competitors and in some ways did not adequately evolve to keep pace with the changing retail landscape,” Griffith said on the call. “I believe we have a tremendous opportunity to rejuvenate this business as we address these issues and position the company to leverage its strengths. This includes creating a relevant assortment that maintains our classic American heritage with an updated look, providing a clear brand identity to speak to today’s consumer and better leveraging our existing distribution channels, while expanding into new channels.”
In addition to e-commerce, the retailer will evaluate how it sells at retail and wholesale levels, he said. Lands’ End also will focus on expanding its geographic reach. “Within the United States, Lands’ End is well known in the Midwest and the Northeast, and can improve its relevance with customers in other regions,” Griffith said. “Lands’ End is already distributed internationally, but we will work to better connect with our customers and further expand the business worldwide.
For fiscal Q4 2016, ended Jan. 27, Lands’ End also reported:
- Direct sales (online and catalog) of $398.5 million, down 2.6% from $409.1 million in fiscal Q4 2015.
- Retail sales of $60.3 million, down 6.4% from $64.4 million.
- Net revenue of $458.8 million, down 3.1% from $473.5 million.
- Net loss of $94.8 million compared with a net loss of $39.5 million.
For fiscal 2016, Lands’ End reported:
- Direct sales of $1.15 billion, down 5.0% from $1.21 billion in fiscal 2015.
- Retail sales of $186.4 million, down 8.9% from $204.6 million.
- Net revenue of $1.34 billion, down 5.6% from $1.42 billion.
- Net loss of $109.8 million compared with a net loss of $19.5 million.