How Claire's Stores Has Grown its Brand Internationally
With a global economy becoming more of a reality by the day, brands are setting their sights on expanding their operations beyond their borders to grow profitably. One such brand taking this approach is Claire's Stores, an apparel and accessories retailer for teen girls and young women.
In a keynote session at the National Retail Federation's Big Show in New York City yesterday, Jim Fielding, CEO of Claire's Stores, discussed his brand's experiences going international, as well as some takeaway lessons for the retailers in attendance who may be following closely behind.
Claire's Stores, which opened its first international location over 20 years ago, currently has a brick-and-mortar presence in 44 countries, as well as five e-commerce sites. The guiding principles behind the brand's international strategy are contained in five "P's":
- Promise: This manifests itself in the brand's promise of creativity and self-expression, exemplified by store associates being able to choose their outfits (uniforms aren't required).
- Product: Thirty-five percent of Claire's international stores’ SKU's are localized to the individual market.
- Place: The size, shape and configuration of Claire's stores are customized to local markets. For example, the brand's European stores are, on average, 30 percent smaller than its U.S. stores.
- People: Our goal is to attract and retain top-level talent from the local markets in which our stores located, said Fielding.
- Performance: This occurs if we ensure all of the other P's are in place, Fielding said.
In addition to the five P's, Claire's takes the following factors — both internal and external — into consideration before entering a new market:
- Is there market saturation among competitors selling similar merchandise?
- Does it have the cash flow available to fund investment in both the short term and long term?
- Are its core capabilities scalable without negatively affecting the company's domestic business?
- Does it have available management resources with the cultural and international business knowledge to tackle entering a new market?
- Is it risk tolerant and does it possess the patience to meet its goals?
- Is there customer demand in the market for its brand?
- What's the size and growth potential of the market? You need to know when to walk away, Fielding cautioned.
- Is our brand offering differentiated vs. the competition in the local market?
- Is it an adaptable business model?
- What's the maturity of the retail market, and are there any factors (e.g., political unrest) that could negatively influence it?