Why Ann Taylor's Name Change Is Only Important to Its Managers
What's in a name? In the case of Ann Taylor Stores (ANN), slimming down its corporate name into the simpler Ann Inc. signifies the start of a sweeping strategy that's changing the way the entire company will position itself.
In Ann Inc.'s case the switch isn't going to reflect on its existing shops. Ann Taylor and LOFT will continue to fly their respective flags over its 907 stores (including 276 Ann Taylor stores, 506 LOFTs, 92 Ann Taylor Factory stores, and 33 LOFT Outlet stores).
Rather, Ann's CEO Kay Krill says it's more about the company's multi-channel strategy that includes downsizing existing Ann Taylors and opening smaller, boutique-style new ones, pushing to grow LOFT and Outlets as well as enhance e-commerce and inventory management systems.
Those are all smart ideas that can be especially valuable if they are executed as wisely as one company initiative to open 44 outlets in former Liz Claiborne outlet locations. The customer is already there, along with potential for new traffic, and the LOFT brand is more viable and fresh than Claiborne.
Yet while this announcement was made with a bit of PR fanfare, it's certainly not the first time a retail chain modernized its moniker. The former Sears & Roebuck, R.H. Macy, and their ilk now seem quaint and better suited to shoppers of another era. Even JCPenney (JCP) and Walmart (WMT) eighty-sixed corporate punctuation to keep step with speedy shoppers who are more likely to log on and browse rather than peruse the aisles of a brick and mortar store.
In some cases, those official name changes came after devotees had been using the foreshortened version for years (think Macy's) and didn't resonate with customers as much as a shopping bag design or new signage. And what's in the stores (and what's flying off the racks) are what really matters on the balance sheet.
The retail industry demands creative management strategies to keep consumers engaged. Clever marketing, exclusive products and partnerships, and excellent customer service are all part of the success or failure. For instance, Sears' (SHLD) scattershot strategies have the chain flailing with a 13 percent profit loss, while Macy's (M) steady-as-she-goes approach to in-store sales concepts pushed sales up 5.4 percent) The company names -- not so much.
If it makes management feel good to change the name to Ann Inc. after 57 years -- and switch up the logo colors periodically to reflect a charity of choice -- great. But the new skinny needs to deliver on the promise of fleshing out e-commerce and mobile shopping. 75 percent increases at both anntaylor.com and loft.com indicate the fashionistas are eagerly buying no matter what name heralds the entrance at headquarters.
Image via Ann Taylor
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