Boy meets girl. Boy proposes to girl. Boy and girl head down to the local department store and register for home items, such as place settings, stemware, and linens.
Okay, maybe gift registries were never quite that simple. But they’re a whole lot more complicated now.
Never mind the fact that consumers can set up a gift registry for just about any occasion, from baby showers and housewarmings to birthdays and retirement parties. Merchants selling in multiple channels now have to manage multichannel registries.
Single-channel gift registries are almost obsolete, says Sven Tarantik, wedding and gift registry director for gifts and tabletop items cataloger/retailer Fortunoff. “Without that Internet piece, and offering brides the opportunity to register online, the bottom line is we’d lose them,” he says. “I don’t know too many who have brick-and-mortar [only] registries.
Having previously worked for retailers Linens ‘n Things and Macy’s, Tarantik has nearly 20 years of experience in the gift registry business. Fortunoff stores sell kitchenware, gifts, furniture and home decor, and outdoor living products, “but a lot of people consider us a jewelry store,” Tarantik says. A major registry challenge: “How do we get that bride to click on our site?
At Fortunoff, he says, “online registries are the biggest focus.” Half of its registry on an annual basis comes from online, which he says is “pretty typical.” Just five years ago, Web registries were a much smaller portion of the merchant’s business. “People were used to setting up an appointment and coming to meet with a consultant,” he notes.
About 40% to 50% of Fortunoff’s online registrants will visit the store at some point. And the retailer wants them to — it has bridal consultants assigned to stores who track weekly registrants and contact them to invite them to visit the store.
When online registrants don’t go to the stores, “we see a huge drop in registry value,” Tarantik says. “When we get that bride to come in, in front of a bridal consultant, we see a significant lift in registry value.”
The biggest challenge facing stores with multichannel gift registries is creating and maintaining a balance of online vs. in-store customer interaction, says Tom Hayes, senior vice president/general merchandise manager for Reading, PA-based department store retailer Boscov’s.
“We need our brides to come into our stores so they can experience our outstanding customer service,” Hayes says. “Utilizing our sales and consultant staff to learn, touch, and feel our product offering is important to build a high registration value.”
Balancing the online/in-store gift registry experience is indeed crucial. Since many customers who register are younger and expecting to spend money on a wedding, a house, or a baby, retailers need to make that gift registry program easily accessible across channels, says Neil Stern, senior partner with Chicago-based retail consultancy McMillan/Doolittle.
A registry also provides an opportunity to develop a relationship with customers “at an immensely critical time in their lives as they change a life stage.” Plus, registries drive traffic to other categories in the store, he says.
Providing a positive registry experience is key, as shoppers “could be potential registry customers themselves,” says Deborah Kahl, J.C. Penney’s gift registry director. “This is also a great way for them to view our breadth of products,” and may even encourage them to visit the general merchant for themselves, she says.
Customer differences
J.C. Penney’s online and retail registrants tend to be different customers, “although most of our registrants use both channels — store and online — during the pre-event period,” says Kahl. “Understanding the different expectations of each of these customers makes the strategy for each channel well defined.”
The merchant’s store registrant tends to be younger and requires more attention. “These customers need to be walked through the registry process more closely,” Kahl says.
Penney’s online registrant tends to be older, has a better idea of what he or she wants, and can navigate through the process with more ease, she adds. “Their customer service expectations are more of a breadth of product and ease in the process.”
But other marketers find younger registrants prefer Web interaction. “We recognize that the Internet and e-mail are critical elements to reaching our younger, tech savvy consumers and developing their loyalty, essential for long-term growth,” says Hayes. “The Internet and e-mail have become our brides’ primary mode of communication.”
Online registration, e-mail updates, and special offers have been essential to building Boscov’s wedding business. The retailer has had a gift registry for at least 15 years, Hayes says, and started its online registry in 2002.
“The online and 800-number [telephone] element of wedding registrations also addresses the need for out-of-town guests to be able to purchase what she wants from the store she loves,” he adds.
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The key is to create significant cross-channel presence to the consumer from a communications standpoint, consultant Stern says. “This requires making consumers aware of the program in general, and then specifically referencing and training cross-channel capabilities.”
Stern says the challenge is twofold: “From a systems standpoint, [it’s] creating a seamless process for providing real-time updates for the list. Then there is a marketing challenge of creating and promoting awareness of the program.”
How difficult is it to keep systems updated, and how critical a factor is that? “The customer is much more sophisticated in terms of shopping online, and registry is no different,” Kahl says. “Well over half of our registrants begin online. Updated systems are paramount to our success in that the accuracy of the gift list drives purchasing.” Penney continually refreshes and adds new functionality to the experience to better serve both the gift registrant and the gift purchaser, she says.
This requires “a combination of IT enhancements based on customer feedback and inventory management, ensuring that the customer understands the status of each item he or she is registering for, or when the customer reviews the gift list,” Kahl says.
What if someone places a registry order by phone? Kahl says that information is quickly updated with store/Web data through J.C. Penney’s integrated systems. Of course, customers placing the phone order must identify the purchase as a gift registry sale and the name of the registrant, she says.
Keeping systems updated is critical, Boscov’s Hayes adds. “This includes being in stock on registered items, adding and removing product offerings to and from the system as we transition assortments, and assuring registries are updated so gifts are not duplicated,” he says.
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Program perks | |
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Since any marketer can set up a gift registry these days, there’s considerable competition for customers. “The biggest challenge is that many brides typically register at two or three places, and there is a lot of competition out there,” says Fortunoff’s Tarantik.
In fact, Fortunoff executives periodically shop its competition to evaluate its own programs and bonuses. “Every wedding registry offers a variety of different perks, or reasons to choose the registry. They must be compelling and add value to the bride’s experience,” he says.
For instance, Fortunoff’s registry perks include online wedding planners; offers for the bride during registration, such as a loyalty program with rewards, discounts on products and services, and partnerships with local service vendors; and offers to the bride after the wedding with setting completion discounts.
J.C. Penney’s registrants receive 10% off any items left on the registry up to a year after the event date, says Kahl. For shoppers using the registry, Penney offers free shipping and handling for online orders of $49 or more, as well as free gift-wrapping for all online orders,” she adds.
Tarantik says the new trend is based on rewards programs. “We launched ours in October [2006], called Wedding DreamClub,” he says. “We’re seeing a lot of large retailers trying to ‘incentivize’ the brides with a rewards program as the driver. It’s proven to be extremely successful.”
Wedding DreamClub is a rewards program tied to the use of Fortunoff’s credit card. Customers receive all the benefits of the regular DreamClub, and when a gift registry is linked to a store credit card, the registered person earns points toward a gift card when guests make purchases from that particular registry.
Boscov’s also has an aggressive rewards program. Started in 2003, the program includes 10% back based on the value of gifts purchased, up to $250.
But if all retailers with multichannel gift registries offer similar products and services, what makes the difference?
“The keys are having an extremely compelling Website, offering the breadth of products, and some added value in your Website,” Tarantik says. “It needs to be a fun experience online for them, they have to feel comfortable, and you have to have that breadth of assortment.”
All told, Tarantik says the key ingredient in running a successful multichannel gift registry program comes down to the basics. “Customer service makes the biggest difference,” he says.
“For us, we pride ourselves on having dedicated bridal consultants in every single one of our stores. Consultants, trained at delivering a higher level of customer service, can multitask and keep track of a large number of brides. The service goes a long way.”
Penney offers online features such as ship-to-store (all online items can be shipped and returned, with an immediate refund, to more than 1,000 local J.C. Penney stores) and inventory visibility (so shoppers can see what’s in the store before they go), as well as free shipping offers and a gift wrapping service, Kahl says.
What’s more, Kahl says successfully managing multichannel gift registries revolves around effectively balancing online and in-store customer satisfaction.
“As we become more integrated in the multichannel experience, this becomes a key to our success,” she says. “The customer’s expectation is a fully integrated in-store and online experience.”
But Kahl believes the biggest challenge is gauging the expectations of the gift purchaser. “Often their expectations are much higher than the registrant’s as they are the one who have the true customer shopping experience,” she notes. “It’s integral that we make the shopping experience for both in-store and online as easy and seamless as possible.”
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First comes love… | |
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Fortunoff has a four-phased approach to managing its wedding registry contacts, says Sven Tarantik, the merchant’s wedding and gift registry director. “We have the engagement stage, where the groom comes in and purchases the engagement ring. That starts the cycle.”
In phase two, the engaged couple visit the Website or store and register for gifts. During the ceremony phase, Fortunoff is the couple’s source for items such as wedding presents, attendants’ gifts, and wedding bands.
The newlywed phase is next. In this phase, “we extend discounts to them and they become part of our databases where they receive special offers, periodic touch-bases through direct mail, or Internet e-mail blasts” during the year after their wedding, Tarantik says.
It’s not just about the table. With the indoor and outdoor furniture the retailer sells, “we can become a source for that nesting collection,” he adds. And after that? “We also have a baby registry.”
— JT