Retail Leadership Symposium (Consumer Science 250)
By Students Ava Buechel, Maggie Boyle, Sydney Blixt, Allyson Bartelme, Randi Armstrong, and Arialis Aranda
CEO and President of local retailer Duluth Trading Company, Stephanie Pugliese presented to the Retail Leadership Symposium on April 26, 2017. Stephanie has a long history in the retail industry, starting at Lord and Taylor ,where she really found a passion for retail. Since then she has worked for Ann Taylor, Land’s End, and even owned her own business. She still maintains her entrepreneurial spirit and brings it to her daily life at Duluth. She is inspired by her family, and has loved settling down in Wisconsin.
Let’s Talk Strategy
Duluth Trading: Unique Solution-Based Products
Details: Duluth aims to solve problems for customers and does so by focusing on the details of their products. Their solution-based mindset started in 1989 when they made the bucket boss — a tool carrier that was lightweight unlike the metal tool boxes of the past. A modern day example of detailed features is that their jackets contain larger zippers because many of their customers wear gloves for gardening/working outdoors. Larger zippers allow them to keep their gloves on while zipping or unzipping their jackets.
Unique features: Because Duluth Trading Company creates solution-based products, their apparel has unique features that other companies do not consider. For example, their women’s shirts include a piece of cloth on the inside for cleaning off glasses and sunglasses.
Lifestyle: Duluth Trading company targets modern self- reliant Americans and tries to satisfy their needs for everyday casual wear. With every product the customers buy, Duluth is selling a piece of a lifestyle.
Ultimate quality: Unlike other retailers, Duluth Trading company focuses on quality over price. They aim to create products that last unlike the fast fashion retail trend today.
Tank for no yank: Duluth Trading Company helped women overcome problems with constantly having to pull down their tank tops. They did this by creatively developing the No-Yank Tank. Now their customers can work outside without having to readjust their shirts over and over again.
Happy customers: Duluth Trading Company received positive feedback, and is constantly reassured that their quality products are satisfying their customer’s needs. For example, their Buck Naked Performance Boxer Briefs have over 12k reviews with 4.8/5 stars.
Quality Product Over Price
With the rise of fast fashion, consumers are choosing to spend their money on cheaply priced clothing and as a result are experiencing a decrease in quality and the need to constantly replace clothes that only last a few wears. At Duluth Trading Co. however, this is not the case. Duluth prides themselves in being known for their high quality, but still affordable, clothing that can last for years. A look at their online reviews shows just how satisfied customers are with their Duluth purchases. For example, reviews on a pair of men’s jeans shows the durability of their clothing as one customer claims to have had the same pair of Duluth jeans that they bought over 10 years ago!
While Duluth is proud of the quality of their clothes, they are also proud of the way they have been able to uphold their brand image. By avoiding the wholesale business and not allowing other stores to carry their brand, they have been able to present themselves in a consistent matter. Aside from this, as the sole vendor of their brand, they have the ability to implement controlled pricing strategies and thus not compete with themselves in terms of having to price their own goods better than what other stores carrying them are. Most importantly, maintaining sole control of the brand means that Duluth fully owns the relationship with the customer and can offer quality past that of their clothing, but also of the experience and service consumers are receiving.
Don’t Take Yourself Too Seriously…
Duluth Trading is known for their relatable, “not-so-serious” television ads and marketing materials. The company often features a silly lumberjack or beaver and uses cartoons and animations to get their message across. They also never fear from addressing issues such as “plumbers crack” and “the curse of the yank-tank.” There humorous ads certainly gain attention from audience but do not take away from the quality of this company’s products whatsoever. Stephanie Pugliese stated that what she thinks makes Duluth so unique is how it beautifully blends amazing personality in marketing and equally amazing product quality.
Duluth Trading has recently expanded its Women’s line and also created a series of ads featuring empowering images of real “Duluth Women.” These ads leave the viewer inspired to go out and “get their hands dirty” knowing that they won’t be slowed down by issues such as the need to constantly pull down their tank when working. Duluth has successfully combined playful advertising, serious solution-based products, and premium quality goods. A company can have flashy, attention-grabbing advertising but if customer’s needs are not being met, that company’s job is not being done.
Company Growth and Expansions
In the challenging brick and mortar environment of today, Duluth Trading continues to expand in this aspect of retail. Although it is the popular belief that brick and mortar retail is dying, Pugliese pointed out that 85% of all retail sales are still generated in store. Clearly, the need for brick and mortar is still being recognized as Amazon, the retail powerhouse, has also released plans to open stores. Another good example of a store that is still growing in brick and mortar other than Duluth includes Ross Stores, whom we also heard from this semester. Duluth believes that there is a significant whitespace opportunity to grow their U.S. retail presence. Although it requires about $2 million to open a new store, their new store assumptions have generated an average payback time of less than two years. Duluth plans to open 10-12 stores in 2017 and to accelerate the rate of new store openings over the coming years.
Traditional Retailing Isn’t Dead
With countless retail articles having titles referencing the amount of brick and mortar stores that Company X closed, one has to wonder if the age of brick and mortar stores is coming to an end. E-commerce is definitely a retail channel that has the potential for exponential growth; however, 85% of sales are still made within brick and mortar stores. We tend to let the number of brick and mortar stores closing sit at the forefront of our thoughts when examining trends in physical retail space. In reality, there are numerous companies who are still expanding their brick and mortar locations, and Duluth Trading Company is one of them.
Duluth truly sticks to the classic retail appeal in more than one way. Duluth still offers their customers catalogues, which is a retail channel that seems to be close to extinction. Duluth also limits the amount of technology that is used within their stores. Instead of fancy automated robots and magical mirrors enhancing your shopping experience, Duluth offers a genuine human to human relationship that begins the second you walk through the door. They have unique exhibits within each store, and a friendly sales associate will be there to explain why the exhibit is there as well as the exhibit’s history. This technology barren experience may not be for everyone, but with a 45% compounded annual growth rate, we can assume that Duluth truly knows how to tend to their customers unique set of preferences and needs. Duluth truly proves that knowing your market fit is everything. As it turns out, traditional retailing isn’t dead. Duluth’s brick and mortar expansion is here to see that a traditional in-store experience is here to stay.