Aldo Case Study PDF

ALDO, A RETAILER WITH A CONSCIENCE AND “SOLE” The philosophy of Canadian shoe retailer Aldo is to inspire and move forward. With over 2,300 points of sale in 100 countries, the company wants to be seen as a key player in the world of fashion, footwear, and accessories.57 Aldo Bensadoun launched his...

ALDO, A RETAILER WITH A CONSCIENCE AND “SOLE” The philosophy of Canadian shoe retailer Aldo is to inspire and move forward. With over 2,300 points of sale in 100 countries, the company wants to be seen as a key player in the world of fashion, footwear, and accessories.57 Aldo Bensadoun launched his business in Montreal by selling shoes in concessions located in Le Château stores. His first standalone store opened in 1978, followed by stores in the United States in 1993, and overseas two years later with its first franchise store in Israel. The son of a shoe merchant whose grandfather was a cobbler, Bensadoun was guided by a set of values that focused on compassion and ethics. His goal was to create a brand that had a conscience, one that cares. This commitment to society is evidenced through its Aldo Fights Aids campaign, an initiative started in 1985 when many retailers were reluctant to take a stand on the disease. Numerous other causes are supported, including War Child and the Cure Foundation. Canada’s retail footwear industry is valued at $6.8 billion, however, the market is stalling with annual growth rates projected at only 3 percent. In Canada, fashion conscious men have propelled sales to $2.8 billion, up 10 percent. However, the all-important women’s market has fallen by 0.9 percent to $3.4 billion.60 Competition has dramatically increased—fewer shoppers are visiting physical stores; fashion and department stores such as Zara, H&M, and Hudson’s Bay are stocking more shoes; and low-cost rivals are attracting price conscious consumers. Many clothing retailers have aggressively added to their footwear selection, increasing sales from 0.2 percent to 5 percent of projected revenues. Consumers expect Aldo to be in its own branded stores as well as other fashion retailers and online. That’s why the company sells its products through Nordstrom, Hudson’s Bay, Zappos, and Amazon.62 Of course, selling via other outlets means fewer opportunities to interact with shoppers directly. To get better insights on what customers want, Aldo uses tools from Salesforce. Its Service Cloud tool lets customer service reps quickly access customer data and respond to their questions in real time. Through the Marketing Cloud tool, Aldo can join in social media conversations related to its brand. In 2014, Patrik Fisk took over as the company’s CEO, launching international expansion plans and high-tech store changes projected to double its business in five years. Already recognized as an early adopter of ecommerce technology, Aldo has built on its digital prowess through consumer facing solutions. A suite of mobile apps let shoppers digitally interact with the brand. Customers can browse and access the collection by size, colour, or key silhouettes, along with user-friendly self-service tools which allow for try-on requests.64 The Aldo Connected Store app allows customers to scan boots or bags for more product and style information.65 The mobile app and virtual shelf features lifestyle content with fully styled imagery to inspire customers and help them visualize ways to style the collection into their own wardrobe. Apps are designed to enhance the shopping experience while providing Aldo with the opportunity to offer better service. David Bensadoun, named CEO in 2017, continues to tweak the company’s retail strategy involving redesigning its brick-and-mortar stores. Aldo is seen as being very savvy and recognizing trends faster than other retailers, which makes it an attractive tenant according to Cadillac Fairview, one of Canada’s largest enclosed mall owners. Aldo is investing more than $500 million in store renovations, new systems, and staff education.66 Digital screens and tablets are being added to stores. Prices will be raised 5–10 percent to help pay for “premiumized” stores that will scale back the number of shoes offered by 25 percent to focus more on global styles. Mobile will feature heavily in all of Aldo’s stores, including its new “connected store” at the Westfield World Trade Center in New York. When app subscribers enter the store, alerts will be sent to sales staff with information about past purchases, items in their digital carts, and also an estimate of the person’s lifetime value as an Aldo customer. Staff is being trained to bring the pair of shoes requested plus a second pair that matches consumers’ specific needs, for example, a sandal that matches the style of a high-heeled pump. And although mall traffic has been falling, in some cases as much as 10 percent, Aldo is not worried about fewer browsers in its stores. Most consumers do their research before arriving at a store, make targeted trips, are more focused when shopping, and arrive ready to purchase. The company uses social media to reach customers, too. A survey by Wedding bells found that 80 percent of Canadian brides indicated they would use Pinterest to plan their wedding. So, when Aldo launched its bridal and special occasion collection, it created a contest on Pinterest called “Inspired by I Do.” Contest participants created a Pinterest board of their dream wedding, pinning at least five Aldo products to it for a chance to win shoes and accessories for the whole wedding party. The contest was promoted on other social media channels as well, generating 400 entries and over 2,000 Pinterest pins. Even after the contest ended, people continued to pin and re-pin items, extending the campaign’s reach. Aldo has come a long way in the past four decades. Today it is able to deliver new products in less than a year, sometimes in less than three months, to locations around the world, introducing new products in stores each month. The company has synced its in-store, online, and mobile platforms to create a consistent, personalized, and seamless omnichannel experience for shoppers. Built on a foundation of ethics and compassion, Aldo has successfully navigated choppy retail waters. And along the way, it has been recognized as a good corporate citizen, one that cares, and one with “sole.” Questions 1. Assess the role of consumer expectations in Aldo’s success as a footwear retailer. 2. How has Aldo used technology to differentiate it from other footwear retailers in a crowded, competitive marketplace? 3. CEO David Bensadoun developed a new retail strategy for Aldo to increase value for customers. Discuss how specific changes made to the four Ps and personnel will help the company to attract more customers online and in stores. 4. While other retailers focus on pricing, Aldo has invested in staff training and introducing global styles. Discuss how the company can increase sales and the level of customer service through non-traditional initiatives like this. 5. As an advisor, what type of retailing and omnichannel marketing strategy do you propose to Aldo to increase online and in-store sales? Justify your strategy.