Urban Outfitters 2010 Annual Report Download - page 9

The ever-changing mix of products available to our customers allows us to adapt our merchandise
to prevailing fashion trends, and, together with the inviting atmosphere of our stores, encourages our
core customers to visit our stores frequently.
We seek to select price points for our merchandise that are consistent with the spending patterns
of our target customers. As such, our stores carry merchandise at a wide range of price points that may
vary considerably within product categories.
Store Operations
We have organized our retail store operations by brand into geographic areas or districts, each
with a district manager. District managers are responsible for several stores and monitor and supervise
individual store managers. Each store manager is responsible for overseeing the daily operations of
one of our stores. In addition to a store manager, the staff of a typical Urban Outfitters, Anthropologie
and Terrain store includes a visual manager, several department managers and a full and part-time
sales and visual staff. The staff of a typical Anthropologie store may also include a customer care
manager who helps tailor the shopping experience to the needs of Anthropologie’s target customers.
Our Free People retail stores include a store manager, a visual coordinator and full and part-time sales
staff. A Terrain garden center may also include merchandise care and maintenance staff.
An essential requirement for the success of our stores is our ability to attract, train and retain
talented, highly motivated store managers, visual managers and other key employees. In addition to
management training programs for both newly hired and existing employees, we have a number of
retention programs that offer qualitative and quantitative performance-based incentives to district-level
managers, store-level managers and full-time sales associates.
Marketing and Promotion
We believe we have highly effective marketing tools in our catalogs and websites. We refresh this
media as frequently as daily to reflect the most cutting edge changes in fashion and culture. We also
believe that highly visible store locations, creative store design, broad merchandise selection and
visual presentation are key enticements for customers to enter and explore our stores and buy
merchandise. Consequently, we rely on these factors, as well as the brand recognition created by our
direct marketing activities, to draw customers into our stores, rather than on traditional forms of
advertising such as print, radio and television media. Marketing activities for each of our retail store
concepts include special event promotions and a variety of public relations activities designed to create
community awareness of our stores and products. We also are increasingly active in the burgeoning
arena of social media and blogs. We believe that the traditional method of a one-way communication
to customers is no longer enough. We believe that by starting a conversation and interacting directly
with our customers, most notably via Facebook and Twitter, we are more effective at understanding
and serving their fashion needs. We also believe that our blogs continue this conversation. Not only do
we communicate what inspires us; it allows our customers to tell us what inspires them. This fosters
our relationships with our customers and encourages them to continue shopping with us.
Suppliers
To serve our target customers and to recognize changes in fashion trends and seasonality, we
purchase merchandise from numerous foreign and domestic vendors. To the extent that our vendors
are located overseas or rely on overseas sources for a large portion of their merchandise, any event
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