Reebok 2010 Annual Report Download - page 90

86 Group Management Report – Our Group Global Sales Strategy Retail Strategy / eCommerce Strategy
Dedicated real estate teams have been
set up who make sure that:
– Store location and store size fit to the
local market
– Store is designed to drive high sales
per square metre
– Market share growth and increased
market presence is in line with our
integrated distribution roadmap, where
Retail will focus on the top 100 cities
globally.
Processes
Streamlining and harmonising retail
store operations and supply chain
processes to gain the necessary speed
to respond to consumer requests
remains a top priority for Retail in
2011. From a store perspective, a key
initiative is to identify and promulgate
best-in-class operations policies and
procedures and ensure consistent
adoption to the new retail standards.
Globally consistent manuals will provide
clear and commercial guidelines for
store development, visual merchandising
and in-store communication procedures
to establish flawless execution and
operational excellence.
adidas Originals
Core Store in Munich
We will also continue to work on adapting
the supply chain, system landscape
and buying and demand planning
processes. This is essential as we strive
to increase our in-season flexibility, be
more responsive to changing trends
and to achieve economies of scale for
the Group’s retail activities. Shifting our
retail focus strictly onto the consumer
also means changing our mindset from
a sell-in (push model) oriented to a
more sell-through (pull model) oriented
perspective.
Profit
To increase the commerciality and
profitability of the Group’s existing retail
assets is the primary focus of all retail
teams, whether they are working in
logistics, store operations, marketing
or any other Retail function. Therefore
we will close down stores not reaching
their potential, as well as closely review
and monitor each new store opening or
remodelling to ensure that the targeted
profitability and return on investment is
accomplished. As part of Route 2015, a
key area of focus is to increase four-wall
profitability in existing brand centres
and brand core stores. To support this
strategy, in 2010, Retail introduced a new
set of operational KPIs benchmarked to
best-in-class retailers.
eCommerce Strategy
At the beginning of 2010, a leadership
team was put in place to define and
outline the strategic direction of the
Group’s eCommerce activities for the
adidas and Reebok brands. Although both
brands have made advances with their
respective platforms in recent years, we
believe there is considerable untapped
potential for the Group in this channel of
distribution.
As part of our Group-wide strategic
business plan Route 2015, eCommerce
has defined its strategic priorities which
include:
– Establish eCommerce as the third sales
pillar
– Balance Wholesale and eCommerce
activities by implementing a new
distribution policy
– Create one consumer destination
by integrating brand, shop and
customisation sites
– Build a best-in-class technology
platform
– Drive attraction, conversion and
retention by building enhanced
e-marketing capabilities.
The success of our eCommerce strategy
will rest on our ability to attract, convert
and retain the consumer in a crowded
marketplace. To attract the consumer,
we need to better optimise the visibility
of our site and how it ranks in online
searches.
We also have to improve our
management of paid placement and
link our own site to social media to
attract larger numbers of the right
type of consumer. To drive higher
conversion rates, we intend to simplify
and improve functionality of our
e-commerce platforms to create best-
in-class shopping experiences. Finally,
to retain consumers we will strive to
create targeted communication as
we gain a deeper knowledge through
improved CRM solutions that will allow
for more robust consumer interaction.
In this respect, social media will play
an important role as it facilitates
a deepening of the dialogue with
our consumers and a more evolving
relationship with them.
With these initiatives, the Group
targets to generate € 500 million in sales
from eCommerce by 2015.