Aritzia CEO Brian Hill,who is gearing up for the launch of his chain’s e-commerce site, is betting he can learn from his predecessors, and catch up to them in three years.Hubert Kang
At the Aritzia store in Manhattan's trendy SoHo district, a towering wood-carved hand resting on a bed of crystals crosses its fingers, as if to signal good luck to shoppers.
Brian Hill, chief executive officer of Aritzia LP, will need some of that luck, along with a healthy dose of business savvy, for the launch of his high-end fashion e-commerce site in mid-October. "We've essentially had to create a brand-new business," says Hill, the third generation of a Vancouver retail family whose store, Hill's of Kerrisdale, is a local institution. "The e-commerce model requires a completely different approach than that of our bricks-and-mortar stores."
Hill has made huge strides since he started with a single Aritzia shop at a Vancouver mall in 1984, having now branched out to 52 stores–11 in the United States in the past four years and the rest in Canada, each with a unique design. A destination for well-off teenagers and twentysomethings, Aritzia races to keep its edge by pumping up an array of its own lines that are becoming go-to labels in their own right, among them TNA and Wilfred.
Even as he arrives late to the cyber-selling game, he is betting he can learn from his predecessors–and catch up to them within three years. Hill has to compete with global e-commerce heavyweights, including Amazon.com, which recently pushed into the upscale fashion market. His team has spent more than two years developing Aritzia's site, which is influenced by such online apparel sellers as Net-a-Porter, Totokaelo and La Garçonne. "We want our e-commerce site, like our stores, to be a place where the consumer likes to go both to shop and be inspired. ...In some cases, they may go to the site with no intention of shopping but be inspired by an article to buy something."
Serving up both shopping opportunities and insightful editorial content "can be quite difficult," he adds. Aritzia has invested $10-million in its site, the money going to everything from more staff at head office–60 more employees–to boosting capacity by 50 per cent at its Vancouver distribution centre. It updated its warehouse management systems with handheld computers to scan merchandise faster, and set up a call centre to operate from 8 a.m. to midnight. Aritzia even installed a full studio at its offices for fashion shoots. "It's been a big undertaking."
To try to stem the notoriously high rate of returns experienced by most apparel e-tailers, Aritzia is rushing to provide detailed information about its products–and high-quality photos–to minimize shoppers' surprise when they receive their purchases. But it's also designed shipping boxes that are re-sealable, so dissatisfied customers can return merchandise easily. "It's not complicated trying to figure out what you want to deliver to the customer," he says. "It's a little more complicated doing it."
Despite the complexities, e-commerce is an essential business and marketing tool in today's marketplace. "For Canadian retailers, it's critical that they develop this skill set," says Larry Rosen, CEO of luxury men's clothier Harry Rosen, whose online store is just starting to break even after more than two years in operation. "It's not something that develops overnight. ...I can tell you that there were times when we wanted to bang our heads against the wall."
Hill is gearing up for virtual battle. "Believe me, we're not going to know everything and we're not going to be perfect from the beginning." His U.S. store rollout–he plans to add six to 10 North American outlets annually in the short term–paves the way for e-commerce by pumping up Aritzia's brand. In November, he will introduce his biggest store yet–a second location in New York City, on Fifth Avenue. He predicts his e-commerce operation will be in the black within the first year. "I think it will be a very meaningful part of our business in very short order."