Leveraging Internet Technology

 According to the latest research, apparel sales will be the fastest growing product category
on-line through 2002.Forrester Research sees on-line sales of apparel and footwear growing from $92
million in revenue in 1997 to $514 million by 2001.In 1998, holiday shopping figures through
America On-line support the growing trend of on-line sales with a 350-percent growth over the same
period last year and three-quarters of a million people making on-line purchases for the first
time, at an average of $54 per item.While projections such as these make a compelling argument for
selling your products on-line, doing so can be a tremendous challenge for those companies whose
success is founded in more traditional channels of distribution. One question remains: How do you
market the consumer directly without creating channel conflictAt Liz Claiborne, a $2.5 billion
company with annual earnings growth of 18.6 percent, the solution was to support its existing
channels of distribution by developing a web site that was strictly marketing oriented and not
sales driven.LizClaiborne.com is owned by corporate marketing, and is used strictly as a vehicle
for brand building through product information and store locators.

 Leveraging StrategyThe real internet success story at Claiborne is how it has leveraged
the technology as a business-to-business tool as a part of their overall IT strategy. According to
John R. Thompson, Claibornes chief information officer, customer service and logistics
sophistication have replaced brand equity as the differentiators of the 90s.At the heart of
Claibornes strategy is Liz Link, the companys business-to-business extranet web site and
order-tracking system that is dramatically reducing the 1,500-2,000 calls it receives per day from
buyers simply calling to check on the status of their orders.Instead, buyers are now logging onto
the password protected customer service site, where with the use of their browser they can point
and click their way through open, in-work and shipped orders in either units or dollars.
Information can be viewed by account, season, group summary, group, style or by delivery door.The
operational calendar offers allocation, in-store and confirmation due dates by group. Liz News
keeps buyers current on the latest happenings in the company.According to Kevin Keenan, vice
president, Customer ServiceandElectronic Commerce at Claiborne, the benefits from the customer
service site have been tremendous.Since implementation in January 1998, we have been able to
measurably reduce the length and quantity of customer service calls, while changing the calls we do
receive to be more value added as opposed to quantitative. The system offers real-time information,
seven days a week, 24 hours a day, is available from anywhere and allows us to be more pro-active
with our buyers. To date, 25 of Claibornes top 40 accounts are using the system. According to
Keenan, the company has buyers who will go home and use their personal computer to access the
system because they dont have Internet access at the office.So, as the world of fashion races down
the Internet runway in an attempt to grab a piece of the growing on-line marketplace, keep in mind
that the Internet is not just about selling product.Behind what we see on corporate marketing
websites, is a growing web of Intranets and Extranets that are linking business-to-business
throughout the supply chain and making for more efficient technology driven companies who can
better serve the needs of their existing channels of distribution.For more on Liz Claibornes Liz
Link program, see Teri Rosss article, One Step Ahead, in the April 1999 issue of ATI.
Editor’s Note: Teri Ross is owner and president of Imagine That! Consulting Group, publishers
of the award winning techexchange.com. She can be reached via e-mail at 612/593-0776.

June 1999