Jos. A. Bank aligns with AOL

Men's apparel chain hopes to double its Internet activity

Retailing

February 27, 1999|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

Jos. A. Bank Clothiers Inc. has become an America Online Inc. shopping partner, joining retailers such as Gap, J Crew and J. C. Penney Co., the Hampstead-based men's apparel chain said yesterday.

By aligning with AOL, which has 16 million subscribers, Bank expects to more than double Internet activity, David E. Ullman, executive vice president and chief financial officer, said yesterday. The year-long agreement allows users to access Bank's Web site from AOL's shopping page.

Bank declined to disclose financial details of the contract with AOL.

Bank, a chain of 104 stores in 28 states, launched a Web site in August and said traffic has increased from 6,000 hits in November to 11,000 hits in January.

Because the retailer offers a catalog and has distribution systems in place, the Internet seemed a logical step, Ullman said.

"Consumers want convenience, and they want to have multiple channels of distribution to find the product they want," Ullman said. "A person interested in buying from a catalog is also a likely user on the Internet."

Bank is also going after new customers. Some orders have come from states where there are no Jos. A. Bank stores.

"They will try you with basic items first, such as a white button-down shirt," Ullman said. "As they get comfortable, they expand into suits and other products."

Bank's Web site offers the same merchandise that is sold in stores and catalogs, from belts and cuff links to dress shirts, trousers, casual pants, socks and suits.

The AOL affiliation, which started yesterday, includes shopping links to Bank through the AOL network, AOL.com and CompuServe. Bank now has high visibility banners on AOL.com's apparel shopping network and on CompuServe.

Catalog sales now account for about 3 percent of Bank's retail sales and Internet sales should far exceed that, Ullman said. However, whether the Web site will help boost sales overall is unclear, he said.

For its fourth quarter that ended Jan. 30, Bank reported sales of $57.2 million, a 9.1 percent increase. At stores open at least a year, considered the best barometer of a retailer's performance, sales were flat. The company said it considers the slowdown in comparable store sales a temporary one, caused by the chain's rapid expansion, with 17 new stores opened last year.

For Bank, as for many brick-and-mortar retailers, the Internet is being used as a marketing tool, said Kenneth Gassman, an analyst with Richmond, Va.,-based Davenport & Co. But the effect on sales remains to be seen, he said.

Retailers "have to be there to keep the playing field level," he said. "It doesn't create more dollars. It takes dollars away from something else and it appears to be coming out of catalogs. All these retailers are trying to create ad impressions. Will it drive people into the stores? We don't know."

Pub Date: 2/27/99

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