Big Brands, Local Perspectives: Tommy Bahama
This new monthly Street Fight column will feature conversations with C-level executives of global and national brands who understand that local targeting and personalization are essential keys to brick-and-mortar growth.
A Local Home Run
What do baseball, branding, and Tommy Bahama have in common?
Spring training had begun in Arizona, and the Valley was filled with baseball fans and their families. Tommy Bahama, the dual restaurant and retail brand, hosted an informal evening and book-signing with Ned Colletti, former General Manager of the Dodgers and sports legend. The event drove in more than a hundred baseball fans and their families who sipped mojitos, checked out the Tommy Bahama restaurant, and browsed and bought the company’s signature vacation attire.
Combining food and clothing may seem like an odd combination, but the brand revolves around lifestyle—relaxed, fun, and colorful.
This type of highly targeted event is just one part of a multi-dimensional strategy that Tommy Bahama CEO Doug Wood has launched to emerge as a champion in the ever-competitive retail and restaurant games.
Locations that have both a restaurant and clothing store are called “islands.” Says Wood, “We look for opportunities to bring lifestyle fans into those locations and ‘throw a party.’”
Each island also works with local charities on fundraising drives. “Customers will then look at you as part of the community—not as a corporation,” Wood says.
Live events and community-focused marketing play a key role in building brand loyalty.
“Most people interact with a brand on their phone,” says Wood. “They’re on Instagram for a second. I may get you for five minutes if you’re on my website. If you’re in my store, that’s 10-15 minutes. In the restaurant, it’s probably around 90 minutes.”
Growth and Technology
Wood has been with Tommy Bahama (owned by parent Oxford Company) for 17 years. His background is the restaurant business, and Tommy Bahama now has 17 restaurants in the United States, plus one in Tokyo.
The company’s growth strategy entails situating its restaurants in key resort markets and upscale warm weather markets. Last year, total sales were close to $700 million. Three-quarters of that revenue was direct. Twenty percent was wholesale via department and specialty stores.
The restaurants generate $80 million in annual sales. From 2016 to 2017, overall sales rose at a rate of 4.1%.
Tommy Bahama leverages technology to understand its customer base’s shopping and eating patterns. But Wood admits that in the traditional retail world, data isn’t where it needs to be right now to help the company target and cross-sell.
“We’re all trying to ‘get there,’” Wood says.
Wood cites systems that don’t talk to or easily integrate with one another as his company’s biggest technological challenge right now. The company, like many multi-store retailers, is investing in and focusing on tying its brick-and-mortar and online businesses together.
“In the future, I’ll know that a customer in Scottsdale wants to buy a dress today, and I’ll be able to get it to her same-day. My guest doesn’t care where it comes from. Online and retail business needs to be the same business.”
According to Wood, no retailer has technology integration “completely done” yet. Retailers are attempting to integrate what he calls Frankenstein systems. The ideal system will integrate POS with CRM with the back office and inventory. “I want to spend more time analyzing data than integrating it.”
The brand is currently using technology to evaluate and predict store performance. The original database of approximately 2 million retail store customers is being supplemented with online buyers, and the company is using heat-mapping to pinpoint where loyal customers live.
Tommy Bahama is taking a “wait-and-see” approach on geo-targeting because the brand doesn’t want guests to feel like it is an invasive presence in their lives. The company does, however, use retargeting and will follow up on abandoned carts.
Currently, Tommy Bahama does not attribute sales to a marketing channel, nor does it run frequent promotions. It has a trackable Friends and Family event and deploys catalogs three or four times a year. Both programs are supported by online marketing and PPC campaigns.
The Importance of Guest Service and Privacy
“I have a very engaged sales organization … it has to start at a store level,” Wood says. “We look at Yelp and OpenTable, product reviews, and sites like Indeed and Glassdoor. We consolidate the data and get it down to a local level so we can figure out ways to impact the shopping or dining experience.”
“As the CEO of Tommy Bahama, I want to jump on every opportunity, but I don’t believe that my guests are there yet. And I don’t believe that our brand should capture information on everyone who walks in the store. I think that may change, but I’d rather follow than lead,” says Wood. “I’m very protective of our guests.”
Based in Seattle, Wood’s office overlooks the Amazon campus. Though Wood believes in speed and quality of delivery and believes Amazon’s success is remarkable, from his vantage point, customer intimacy and serving consistently great dining and brand experiences is a whole different ball game.
Big brand who has a local market strategy? Please e-mail [email protected] to be considered.
Nancy A. Shenker is the founder of theONswitch marketing (www.theonswitch.com) and the author of four business books, including Embrace the Machine (www.embracethemachine.com), about AI, machine learning, and robotics. She speaks, writes, and consults on the integration of technology and humanity, as well as on content strategy: conventional and digital. A graduate of the University of Michigan, Ann Arbor, she was formerly an executive at big global brands, including Citibank, MasterCard, and Reed Exhibitions.