Stein Mart 2014 Annual Report Download - page 6

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The following table reflects the percentage of our sales by major merchandise category, including shoe department sales, for the fiscal
years indicated:
2014 2013 2012
Ladiesand Boutique apparel 45% 45% 45%
Ladiesaccessories 11% 11% 12%
Mens 19% 20% 20%
Home 13% 13% 12%
Shoes 7%7%8%
Other 5%4%3%
100% 100% 100%
LOCATIONS, GROWTH STRATEGY AND STORE APPEARANCE
On January 31, 2015, we operated 270 stores in 30 states and an Internet store. Our stores are located in the Northeast, Midwest,
Southeast, Texas and the Southwest. We are most fully concentrated in the Southeast and Texas where 184 of our stores are located.
Most locations are in neighborhood, community and regional shopping centers frequented by a more affluent customer. Our optimal co-
tenants within these shopping centers cater to a similar target customer and include highly-frequented retail formats such as other apparel
retailers, higher-end grocers and restaurants. All Stein Mart locations, including the corporate headquarters and distribution centers, are
leased.
We selectively seek additional store locations that strengthen our portfolio in current as well as new markets. We utilize regional tenant
representative brokers to help us identify potential sites for new or relocated stores. New and relocated store decisions are supported by
independent sales forecasts, and approved by a real estate committee made up of senior level executives.
In recent years, our prototypical store is approximately 32,000 gross square feet, down from 35,000 gross square feet primarily due to
smaller backrooms resulting from a change in our distribution process. They have a racetrack design, convenient centralized check-out,
and individual dressing rooms. We display merchandise in lifestyle groupings of apparel and accessories, which we believe enables the
customer to locate desired merchandise in a manner that encourages multiple purchases. We seek to create excitement in our stores
through the continual flow of fashion merchandise, targeted sales promotions, store layout, merchandise presentation, and the quality,
value and depth of our merchandise assortment.
E-COMMERCE
In 2010, we began selling selected merchandise offerings on the Internet. This expanded to additional product offerings for 2011 and
2012. During 2012, we temporarily ceased selling merchandise on the Internet as we realized we needed a world-class platform provider
to maximize this important channel of business for us. We relaunched the Internet site, www.steinmart.com, during the third quarter of
2013. The website allows customers to make online purchases of much of the same product offered in our stores along with some online
exclusive products. The website also provides information for customers regarding store locations, brands, products and selected sales
promotion activity. Visitors to our website may apply for our credit card, sign up to be Preferred Customers, sign up for email notifications,
and purchase gift cards. Internet sales in 2014, 2013 and 2012 amounted to less than 1% of our total sales.
CUSTOMER SERVICE
Our stores offer many services typically found in better department or specialty stores, such as merchandise locator service, a Preferred
Customer program, co-branded and private label credit card programs, and electronic gift cards. Each store is staffed with a number of
sales associates to provide on-demand customer service. Our stores have their own Boutique, generally staffed by specially-recruited
associates who typically work one day a week. We believe this staffing approach adds credibility and fashion integrity to the department.
MARKETING
Our marketing efforts are focused on deepening our relationship with our best customers in order to increase our share of her spending as
well as seeking new customers. We engage in periodic market research, including accessing our proprietary customer panel, to identify
how best to reach each of these audiences and, in consultation with our outside advertising and direct-marketing agencies, we adjust our
marketing focus accordingly.
Our advertising stresses upscale fashion merchandise at discount prices. We utilize a combination of full-color circulars (both inserted in
newspapers and mailed directly to homes), direct mail, newspaper run of press advertising, and email to distribute our sales promotion
messages. To reach a broader audience, increase brand awareness and drive promotional events, we use both television and radio
advertising. We utilize digital media, primarily Paid Search, Comparison Shopping Engines, Affiliate Marketing and Display Advertising to
increase brand awareness and drive traffic to our e-commerce site. We also use social networking sites, including Facebook, Twitter and
blogs.