Williams-Sonoma's (NYSE: WSM) omnichannel strategy is bearing fruit. The retailer reported its best holiday season in five years, thanks to strong online sales and social media programs.
E-commerce revenue now comprises nearly 44 percent of net revenues across all Williams-Sonoma brands, and the company plans to invest more resources into growing the channel.
"Technology is redefining the customer experience, retailing has evolved and increasingly customers interact across channels. The investments we are making are allowing us to provide the best level of services to our customer," said Laura Alber, CEO, president and director, on an earnings call.
The retailer also credited social media for its success in the most recent quarter. Pottery Barn, one of the Williams-Sonoma brands, was the first retailer to partner with Pinterest, an online pin board that has resonated very strongly in the home decor category. Pinterest continues to be a growing source of referral traffic for Pottery Barn online.
"We met with [Pinterest] when they were in a tiny grange in Palo Alto and have been working with them on beta projects from the very beginning. It's a great source of referral traffic and it helps to expose the brand," said Patrick Connolly, CMO, during the earnings call.
Few social media or marketing programs drive retail traffic and sales like Pinterest. According to research by Piqora, a pin on Pinterest generates 78 cents in sales on average. More importantly, a pin can drive both pageviews and orders several months after its original pinning — 50 percent of visits happen 2.5 months after pinning. Research indicates that a pinned item will generate sales for up to 2.5 months after the initial pin.
A social media strategy will continue to be a core focus for 2014. The company has established a social media council, where managers from Pottery Barn, West Elm and Williams-Sonoma meet every month to share best practices.
For the most recent quarter, Williams-Sonoma reported a better-than-expected profit of $133.8 million in the fourth quarter, up slightly from $133.7 million in the year-ago period. Revenue for the quarter, which had one less week than last year, rose 4.3 percent to $1.47 billion. It operates seven e-commerce websites—Williams-Sonoma, Pottery Barn, Pottery Barn Kids, PBteen, West Elm, Rejuvenation and Mark and Graham.
-See this Williams-Sonoma earnings call transcript
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