Stein Mart 2011 Annual Report Download - page 6

Table of Contents
The following table reflects the percentage of our sales by major merchandise category, including shoe department sales, for the fiscal years
indicated:
LOCATIONS, GROWTH STRATEGY AND STORE APPEARANCE
On January 28, 2012, we operated 262 stores in 29 states. Our stores are located in the Northeast, Midwest, Southeast, Texas and the
Southwest. We are most fully concentrated in the Southeast and Texas where 181 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, are leased.
We are selectively seeking properties that strengthen our portfolio of stores in current markets. We utilize regional tenant representative brokers
to help us identify potential sites for new or relocated stores. New store decisions are supported by independent sales forecasts, and approved
by a real estate committee made up of senior level executives.
Our typical store is currently approximately 35,000 gross square feet with 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. Our newer stores are approximately 32,000 gross square feet with the reduction from our past stores being in smaller backrooms
that can be accommodated by our newer distribution processes.
In 2010 we began selling selected merchandise offerings on the internet. This expanded to additional product offerings for 2011 and we
anticipate offering a greatly expanded assortment for the internet selection beginning in Spring 2013. Internet sales in 2010 and 2011 amounted
to less than 1% of sales.
CUSTOMER SERVICE
Our stores offer many services typically found in better department or specialty stores, such as a liberal merchandise return policy, merchandise
locator service, a Preferred Customer program, a Stein Mart Platinum MasterCard 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. We are
also focused on attracting new customers, including younger and Hispanic shoppers who are vital to our future growth. 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 (ROP) advertising, and email to distribute our sales promotion
messages. To reach a broader audience and communicate our brand position, we have increased our use of television advertising to build brand
awareness and to drive sales for specific promotional events. Radio advertising is also employed to create additional excitement for specific
one-day sales. We utilize digital media including online advertising and have a solid presence on social networking sites, including Facebook
and Twitter.
Our Stein Mart Platinum MasterCard (“SMMC”) and Preferred Customer Card programs are important marketing tools. SMMC customers
earn reward certificates based on purchase volume and participate in in-store “extra savings events”. Preferred Customer Card customers
receive preview copies of select circulars mailed to their home, members only shopping days, birthday discounts and special email
announcements. SMMC customers are also enrolled as Preferred Customers. Both programs provide useful database information regarding
customer preferences, habits and advertising receptivity.
4
2011
2010
2009
Ladies’ and Boutique apparel
45
%
46
%
46
%
Ladies
’
accessories
13
%
13
%
13
%
Men
’
s
20
%
20
%
20
%
Home
11
%
11
%
11
%
Shoes
8
%
7
%
7
%
Other
3
%
3
%
3
%
100
%
100
%
100
%
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