J. Crew Mounts Big Web Push for Fall '98

Jul 13 1998

This fall, shoppers at J. Crew stores will get a little something extra when they buy a pair of khakis - a jcrew.com baseball cap.

J. Crew, clothier to the Dawson's Creek crowd, will slip CD-ROMs with Netscape browser software and J. Crew screensavers into shopping bags. Some stores will have a giant jcrew.com URL painted on the wall.

This major push is meant to promote the company's Internet business, which in three years has grown to 5 percent of parent company J. Crew Group's mail-order revenue - and could reach 20 percent of mail-order revenue , or about 10 percent of total revenue, by this Christmas if all goes according to plan.

Getting there won't be easy. While catalog vendors are perfect candidates for e-commerce - the J. Crew Web site and catalogs are "the same product, the same creative; both are just vehicles to move the brand," according to Arthur Cinader, one of the company's founders and its new-media VP - they have nonetheless lagged behind book, music and PC vendors in exploiting the Net. The challenges are familiar: getting senior management to support the online effort, finding ways to economically draw and retain traffic, and building the transactional infrastructure.

J. Crew, a $1 billion retail and mail-order concern that Texas Pacific Group acquired in a leveraged buyout last year, put up a Web site in 1995, but it only let customers order a print catalog.

Not until Cinader hired Brian Sugar as new-media director in 1996 did things begin to take off. Sugar, who had dropped out of college to cofound a Washington, D.C., Web design firm called Neptune Interactive, came to Cinader's attention after sending an unsolicited mock-up of a J. Crew Web site. Cinader invited him to meet and hired him on the spot.

The company formed a new-media group and, in June 1997, offered its first interactive catalog with real-time inventory checking and ordering. The backend system was made up of Netscape's e-commerce server running on Sun 's workstations and Solaris OS, a Sybase database and middleware from Software Engine in Hoboken, N.J. Backend operations ran for about a year at the Manhattan headquarters, before Cinader and Sugar colocated it to ISP Digex facilities in Beltsville, Md.

One big challenge has been prioritizing upgrades, then sticking to a schedule, Sugar says. "We know exactly what we want on our site in the next 18 months, but we if threw everything up there from day one it would have been a mess," he says. "You take it in baby steps, and it's a better execution strategy."

As part of that strategy, the site sports a new catalog every month, 50-item sale catalogs every Friday and themed editions every quarter.

The company's online division is about on par with its competitors. The Gap waited until last year to erect its Web store. Its site now offers Shockwave applications that let shoppers choose outfits and buy them with a mouse-click. And the company outfitted its flagship downtown San Francisco store with PCs and big-screen video monitors to acquaint shoppers with its site.

Direct marketer Lands' End launched its Web site in 1995, but only last year did it get serious enough to create a separate Internet business unit. This spring, the Dodgeville, Wis., company tapped David Zentmyer, former head of the Lands' End corporate sales division, to run the online business; in recent months, it has bulked up its online inventory to more than 1,000 items.

J. Crew hopes to use now-standard Web marketing tactics to pull ahead. Earlier this year, it added a Shockwave golf game to the site and, for summer, a lifeguard game. Though initially reluctant to add gadgets that didn't relate directly to shopping, Sugar changed his mind after the games helped boost traffic 10 percent, to 50,000 visitors a day, and inched up the ratio of browsers to buyers 1.5 percent.

To meet its aggressive 1998 holiday sales projections, J. Crew is negotiating revenue-sharing, sponsorship and direct e-mail agreements with America Online , Yahoo and Excite , though contracts aren't final.

"Last Christmas was about buying books and music CDs online. We're hopeful this Christmas will be about buying apparel online," Sugar says.

But success will likely have a lot to do with traditional merchandising. "It's not how neat your graphics and games are, but how you integrate your catalogs and whether you offer [online] discounts, if you waive shipping and additional charges," says Liz Sara, corporate marketing VP at e-commerce software vendor SpaceWorks . "That'll drive more of us online."