hhl final recommendations v11

2

Meet The

Team

Kristen Busby

Ben Glock

Rachel Hill

Tim Kang

What PRODUCT MIX

should Hen House Linens offer?

Can innova6ve PROMOTIONS increase sales?

How can Hen House Linens increase sales through effec6ve marke6ng?

Product Mix

1 2

Do people like the solids and

pa@erns that Hen House currently

offers?

How do customers use table linens?

4

PromoHons

1 2

Can Hen House Linens implement a referral program to increase sales?

Would creaHng user generated

content campaigns increase sales?

5

INTRODUCE IMPROVE IMPLEMENT

Introduce solids without ruffles to the

product line

Improve seasonal selec6ons by adding

holiday-‐specific paDerns

Implement a referral program to acquire new customers

Hen House Linens should adopt the 3 I’s approach to grow sales

6


7

Introduce solids without ruffles to the product line

103 customers like mixing solids and paDerns vs. 72 that like mixing paDerns with paDerns

Customers like mixing solids and paDerns

Source: Qualtrics Customer Survey

"Customers are much more willing to mix a pa@ern on top of a solid or neutral“

Sales Associate, PoDery Barn

“I would suggest adding solids to the product line and that the paDern on

paDern can be overwhelming,” Homemaker

“Neutral or solid linens typically sell more oRen compared to paDerned linens,” Sales Associate, Southern

Season

8

5 12

103

17

28

72

0

20

40

60

80

100

120

Dislike Indifferent Like

Mixing solids and pa@erns (n=120)

Mixing pa@erns with pa@erns (n=117)

CompeHtors offer solids and paDerns

Po@ery Barn Crate & Barrel

Compe6tors offer a larger variety of solids in bold and neutral colors

Source: Compe6tor Websites

9

6 out of 8 compeHtors we researched offered solid linen products

“O\en customers looking for a base table linen set look for neutral or solid linens,” Sales Associate at PoDery Barn

“Neutrals or solids make it easier to mix and match, change out centerpieces and redecorate a

room,” Sales Associate at Crate & Barrel

West Elm Juliska Bed Bath & Beyond Ballard Design Po@ery Barn Crate & Barrel Pomegranate Pehr

Introduced Solids with Ruffles in Fall 2014

Source: Hen House Linens Website≈

10

Hen House Linens is headed in the right direcHon with the Mallory Co@age CollecHon

More customers do not like ruffles than do


11

Dislike 59%

Indifferent 27%

Like 14% (n=111) “The solids with ruffles may seem too Southern and not appeal to women outside of

the South” -‐Homemaker

Only 14% of respondents like ruffles

Offer solids without ruffles to the product line so customers can layer, mix and match table linens


12

Improve seasonal selec6ons by adding holiday-‐specific paDerns

Linen shoppers want holiday pa@erns

"Younger couples o\en look for holiday themed opHons“ Sales Associate, Crate & Barrel

“Southern Living will be full of table linens for the holidays“ Marke6ng Fellow, Southern Living

“For holiday linens, customers look for classic looks combined with a differenHaHng factor“ Sales Associate, PoDery Barn

“During the holiday season, I use linens with seasonal prints“ House Mother, ADPi

Source: Team Interviews

13

Holiday prints are present and featured on compe6tor websites

Compe6tors feature holiday products


14

15 out of 18 compeHtors feature holiday-‐specific pa@erns

The most popular Holiday is Christmas, followed by Thanksgiving

Percent of ‘Holiday Only’ customers usage by holiday


15

13%

25%

40%

65%

78%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Halloween Other Easter Thanksgiving Christmas

Strengthen holiday presence by developing holiday line

1. Develop Holiday Items

Source: Hen House Linens Website

16

2. Reflect Items in PromoHons


17


65% of new business comes from referrals

77% of consumers are more likely to buy a new product when learning about it from family or

friends

Referred customers are about 25% more profitable per year than their non-‐referred

counterparts

Source: hDps://symphonycommerce.com/blog/turn-‐loyal-‐customers-‐into-‐a-‐referral-‐engine/ , Google images

Referred customers add value to businesses

18

53% of Hen House Linens customers have par6cipated in at least 1 referral program

Customer Par6cipa6on in Referral Programs

“I have parHcipated in referral programs when incenHvized by discounts or free

gi\s“ -‐Customer

No 47% Yes

53%


19

Your customers are likely to try a referral program

N=115

1st Choice

Customers would be best incen6vized with 30% off their next purchase


20

2nd

3rd

4th

21

How It Works

Share a personalized URL with friends

Your friends become new Hen House Linens customers

You get 30% off your purchase the first Hme a friend places an order

The best things in life are shared I N V I T E F R I E N D S, G E T 3 0 % O F F

Source: Team Analysis

New Customers Are Acquired

Current Customers Make More Purchases

A referral program would help grow sales

Sales increase exponen6ally

Source: Team Analysis

22


Introduce solids without ruffles to the

product line

Improve seasonal selec6ons by adding

holiday-‐specific paDerns


Hen House Linens should adopt the 3 I’s approach to grow sales

23

Questions?

24

Appendices Appendix A: Solids 1.  Style Preferences 2.  Crate & Barrel -‐ Table Linens 3.  Guide To Solids & Colors

Appendix B: Holiday Offerings 1.  Crate & Barrel Website 2.  Pomegranate Website 3.  Product & Promo6on Survey

Appendix E: UGC 1.  Current Promo6ons 2.  UGC Research 3.  UGC Examples 4.  UGC Customer Data 5.  Instagram Usage

Appendix E: Primary Research 1.  Store Visits 2.  Industry Experts 3.  Other insights

25

Appendix C: Referral Programs 1.  Marke6ng Research 2.  Referrals Research: Rue La La 3.  Referrals Research: Drop Box 4.  Referral Program Par6cipa6on 5.  Symphony Commerce Ar6cle

Appendix D: Other Data 1.  Market Size 2.  Survey Demographics 3.  Compe6tors

Appendix A: Solids

26

80% of customers prefer or strongly prefer mixing solids and paDerns.

"Customers are much more willing to mix a pa@ern on top of a solid or neutral“ Sales Associate, PoDery Barn

“I would suggest adding solids to the product line and that the paDern on paDern can be overwhelming,” Homemaker

“Neutral linens typically sell more oRen compared to paDerned linens,” Sales Associate, Southern Season

0 20 40 60 80 100 120 140 160 180 200

Bold solids

Bold paDerns

Mixing solids and paDerns

Mixing paDerns with paDerns

Mixing solids with solids

Ruffles

Other

Strongly Avoid

Avoid

Indifferent

Prefer

Strongly Prefer

Style Preferences

Source: Qualtrics Customer Survey & Interviews

27

Solids Table Linens Secondary Research

“The quickest everyday table sepng starts with a casual tablecloth in a solid or seasonal paDern with coordina6ng napkins. We also suggest layering in woven fiber placemats to add natural texture.” – Crate & Barrel

Source: hDp://www.crateandbarrel.com/Resource-‐Guide/Table-‐Linens.aspx

28

Solids Table Linens Secondary Research

•  The first purchase. A solid-‐color tablecloth is suggested for the first purchase, one that matches the dinnerware or accents the dinnerware in a contras6ng color.

•  Color mixing. Add a light-‐hearted touch to dining with a colorful mix of tablecloths and napkins, in complimentary hues and intensi6es.

Source: hDp://www.e6queDescholar.com/dining_e6queDe/table_sepng/table_linens/tablecloth.html

29

Appendix B: Holiday Offerings

30

The home page consists of Crate & Barrel holiday items

Compe6tor Website: Crate & Barrel

Source: hDp://www.crateandbarrel.com/dining-‐and-‐entertaining/table-‐linens/

31

The first items listed are Pomegranate’s holiday items

Compe6tor Website: Pomegranate

Source: hDp://pomegranateinc.com/collec6ons

32

Product & PromoHon Survey

0

1

2

3

4

5

6

7

8

9

None LiDle Some A Lot

To what extent do the products fit with the images

Source: Single Ques6on Survey

33

N= 16

Appendix C: Referral Programs

34

26% of respondents saw referral marke6ng as an effec6ve digital marke6ng channel

56% 37%

32% 26%

13% 12%

8% 7% 6%

4%

0% 10% 20% 30% 40% 50% 60%

Email marke6ng Social network marke6ng

Content marke6ng Referral marke6ng

Search engine op6miza6on Display ads Mobile ads

Digital video ads Affiliate marke6ng

Paid search

Share of respondents

Most effecHve digital markeHng channels for customer retenHon in the US in Q2 2014

Marke6ng Research

Source: hDp://www.sta6sta.com.libproxy.lib.unc.edu/sta6s6cs/316104/effec6ve-‐digital-‐marke6ng-‐channels-‐customer-‐reten6on-‐usa

35

Rue La La offers customers a $10 credit when the referred customer makes their first purchase

Referrals Research: Rue La La

Source: hDps://www.ruelala.com/

36

Dropbox increased users from 100,000 to over 4 million in just 15 months with the launch of their dual referral program

According to founder and CEO Drew Houston,

referrals increased signups by 60% permanently.

Referrals Research: Dropbox

Source: hDp://blog.referralcandy.com/2014/01/21/referrals-‐built-‐dropbox-‐empire/

37

53% of Hen House Linens customers have par6cipated in at least 1 referral program

47%

14%

30%

5% 4%

None

1

Between 2 and 5

Between 6 and 10

More than 10

Number of Referral Programs Respondents Have ParHcipated In

Referral Program Par6cipa6on

“I have parHcipated in referral programs when incenHvized by discounts or free gi\s“ -‐Customer


38

Key Ar6cle: Turn Loyal Customers Into A Referral Engine

“The best and greatest companies actually use their customers to bring in new customers. These brands deliver an amazing experience to their customers across the en6re lifecycle, so the customer ends up referring more customers. That is the most powerful way to grow a brand, and it is also why the most cost effec6ve way to grow a brand is to service your exis6ng customers.” Effec6ve referral marke6ng leads to lower customer acquisi6on costs, faster growth, higher profits and a reduced reliance on paid adver6sing.

Source: hDps://symphonycommerce.com/blog/turn-‐loyal-‐customers-‐into-‐a-‐referral-‐engine/

39

Appendix D: Other Data

40

Hen House Linens has a $3.9B total addressable market.

4.7

3.9

1.8 1.2 1.2

0.5

0

1

2

3

4

5

Bedroom linens

Kitchen & dining room

linens

Window coverings

Curtains and draperies

Bathroom linens

Slipcovers and decora6ve pillows

in ($) billion

hDp://www.sta6sta.com/sta6s6cs/255515/us-‐consumer-‐expenditure-‐on-‐home-‐tex6les-‐by-‐category/

Kitchen & Dining Room Linens Market Size

Source: hDp://www.sta6sta.com/sta6s6cs/255515/us-‐consumer-‐expenditure-‐on-‐home-‐tex6les-‐by-‐category/

41

32 Females 36 Males

Friends & Family Survey Demographics

35%

47%

1%

12%

4%

Under 20

21-‐30

31-‐40

41-‐50

51-‐60

Over 60

n = 68 Source: Qualtrics Customer Survey

42

5%

19%

28% 30%

18%

Under 20 21-‐30 31-‐40 41-‐50 51-‐60 60+

167 Females 1 Male

Customer Survey Demographics

n = 168 Source: Qualtrics Customer Survey

43

•  Other compe6tors:

•  Compe6tors include big box stores that carry linens, such as PoDery Barn and Bed Bath and Beyond •  Chief compe6tors:

Compe6tors 44

Hen House Linens Pehr Pomegranate

Dinner Napkins ü ü ü

Placemats ü ü ü

Cocktail Napkins ü û ü

Napkin Rings ü û ü

Quilted Charger ü û ü

Tablecloths and Runners

ü ü

ü

Cocktail Aprons ü û û

Cook’s Aprons ü û ü

Oven MiDs and Potholders

ü û ü

Guest Towels ü ü û

Pillows ü ü ü

Compe6tor Product Mix


45

Appendix E: Primary Research

46

Stores Visits:

•  Lake Norman, NC: – Difficult to locate Hen House Linens items in store – Store owner was not familiar with brand

•  Dewey’s Bakery, NC: “I have personally owned an apron for over a year, and the colors remain vibrant a\er

washing because it is a high quality product,” Sales Associate, Dewey’s Bakery

47

Store Visits:

•  A Southern Season, Chapel Hill NC: spoke with Liz and BeDy, both Sales Associates –  Hen House Linens products are made out of a lighter material, machine wash friendly and on the casual side

–  Neutral linens sold more o\en compared to paDerned op6ons

–  Hen House Linens did have a high purchase rate but recommended offering more solids or neutral paDerns

–  Said customer age group (she guessed 40-‐55) aren’t used to purchasing home goods online and may want to go to brick and mortar stores to compare and physically see the products themselves

–  Said that Hen House Linens has a niche customer following

48

Store Visits:

•  The Teacher Box, Gastonia NC: Spoke with Liz, Owner –  Customers experiment with other linens that have more color and design a\er they buy a good base linen set that they likely use every day (neutral color scheme and said Pomegranate was a good example)

–  Linens with a variety of textures are popular for layering

– Hen House Linens customers are customers who like to change or rotate linens throughout the year

– Main selling point for Hen House Linens is that they are durable and will last for a long 6me

49

Industry Experts

•  PoDery Barn: Spoke with Tammy, Sales Associate –  Best selling placemat is a beige/ neutral color –  Placing a paDern on top of a paDern may be overwhelming and that customers o\en have a hard 6me visualizing it without physically seeing how it looks in stores

–  Customers are much more willing to do a paDern on top of a solid or neutral

–  Variety of texture is important to customers as layering has become popular with linens (want to layer with different textures and not all the same material or texture)

–  Offered extensive Holiday linen collec6on that sales associate described as “classic looking”

50

Industry Experts

•  Crate & Barrel: spoke with Laurie, Sales Associate –  Saw that more people tend to purchase neutrals/solids to make it

easier to change out center pieces and redecorate a room –  Said that there are two types of linen customers-‐ the customer that

uses linens every day and the customer that uses linens for entertaining

–  Said that o\en customers are brides looking for a beginning set of neutral like linens and experienced customers look to change out their table linens

–  The store o\en stocks the same base solids/neutrals every year but completely changes out paDerned linens

–  When looking at the linen display in store, there was a mul6tude of seasonal linen op6ons ranging from mainly solids (red, gold and green) with liDle addi6onal design to linens that have Christmas trees

–  Said younger couples are o\en looking for Holiday themed linen op6ons

51

Industry Experts:

•  Ellen Buoyer, Interior Designer: – Liked product mix, especially the runners – Uses placemats everyday but only linen napkins when entertaining

– Thought the pricing of Hen House Linens was very agreeable

•  Cameo Edwards, Founder of Migrate Media:

52

Customer Interview

•  A Southern Season: Spoke with Kirkland and Mike who was a couple in late 20s

•  Said that Hen House Linens offers bolder colors and paDerns than other compe6tors

•  Preferred bold versus neutral table linens but said they could see how neutral colors could resonate with a wider range of customers

•  Said they were more likely to purchase paper napkins and use linens for special occasions

•  Recommended to visually pair paDerned pieces online to show customers how to pair linens since some customers may be hesitant to purchase online due to not being able to see the bigger picture of the product and what the en6re place sepng would look like

53

Insight from Homemakers

•  Helen Kang: –  Hen House Linens gives a southern, homey and hospital feel –  The linens would fit well in a country or Nantucket type of home

•  Kathy Busby: –  Uses 6-‐8 sets of placemats for various occasions including everyday, outdoor, 4th of July, Christmas, etc.

–  Doesn’t use tablecloths unless rented for par6es –  Uses throwaway napkins for everyday use and reusable napkins for entertaining

–  Said that she is not concerned with the brand on table linens as long as she liked the look and would not hesitate to purchase online if she was confident in the color

54

Insight from Homemakers

•  Victoria Beyer (UNC Adpi’s House Mother): –  “I like all of the zig zag and stripes that are popular right now, I just don’t know how to mix paDerns together.”

•  Jamie Hill: –  I like the product line, especially the colors and paDerns and the way you can mix and match items

–  I would suggest adding some solid colors to the product line –  I would associate casual and southern to the product –  If you are not from the south, the product and company may seem too southern and not necessarily appeal to a broad range of women outside of the south

–  Adding paper op6ons may draw in customers who are hesitant to use linens

55

Insight from Friends

•  Rachel Glock (College Female): – Thinks that her demographic would tend to like these products

– These products have a light and informal feel – Said promo6ons would drive her to make small purchases on the website

– Really likes the blog as a marke6ng channel and thought that this was a good way to show how the product influences every day life

56

•  How they work –  Promo6ons are adver6sed in the direct

email, as a slide on the website, and as a post on Facebook and Instagram

–  Direct emails go to email campaign list (2900 emails collected through ordering from website or signing up for newsleDer)

–  Of those 2900, only about 500-‐800 open the emails (open rate of approx. 30%)

–  Get less than 1% responding to promos, but orders add up to 25% of web orders

•  Email Analysis –  Show the products of the holiday/season

in use and has a call to ac6on ex. Pick up a tablecloth perfect for the season’s first BBQ…)

–  Email has direct links to specific parts of the website

•  Recent PromoHons –  Dog Days (15% off tablecloths) –  Memorial Day (free shipping) –  End of summer bash (15% off) –  July 4th (20% off) –  Made for everyday (15% off) –  Easter (25% off DNs) –  Valen6ne’s Day (free shipping)

•  PromoHon Analysis

Hen House Linens Current Promo6ons

User-‐generated content is taking off with the rise of mobile and social pla}orms.

92% of consumers around the world say they trust earned

media above all other forms of adver6sing. -‐Nielsen

Over 65% of consumers are seeking out some sort of user generated content before making a

purchase. -‐Elon University Study

Successful UGC’s on Instagram must have tac}ul verbiage and instruc6ons, and incen6ves for

par6cipa6on.

UGC Research

UGC campaigns help build a following on social media and increase brand and product recogni6on and awareness.

Burberry created a website where exis6ng customers could share photos of themselves wearing their Burberry trench

coats, giving them ‘15 minutes of fame’ as models on the site, and allowing other customers to admire their sense of style.

Results: Twi@er followers increased to 1 million, revenue

doubled, and stock growth reached over 300%.

Dunkin Donuts encouraged Facebook fans to upload a photo of themselves with a CoolaDa beverage to be entered into a daily

giveaway. DD followed the simple process “Grab it, Snap it, Post it, Win it”.

Results: Built up social network following, increased brand and product recogniHon with the mass of Coola@a-‐related images

flying around web, and increased brand and product awareness.

Burberry – “Art of the Trench” Dunkin Donuts – “Keep It Coola@a”

UGC Research

Par6cipants upload a photo of their baby in the cloth AMP diapers and include a contest specific hashtag. A winner is chosen every month and the

winner receives 2 cloth diapers.

AMP Diapers photo contest

•  Lots of real, authen6c UGC of their product in use

•  Easy to enter contest through Instagram

•  Prize is brand related – it is their product

•  Contest graphic easily shows par6cipants what they need to do to enter

•  Prize offering could be increased to get more moms to enter

What they did well:

What could’ve been be@er:

UGC Research

*Awards given for most likes on photo, most crea6ve photo, and randomly selected via raffle

100 customers said they were Very Unlikely or Unlikely to par6cipate in the hypothe6cal Hen House Linens Photo Contest shown on the le\.

59

41

21

33

15

0

10

20

30

40

50

60

70

Very Unlikely Unlikely Neutral Somewhat Likely

Likely

How Likely To ParHcipate in a contest like this for a $50 dollar giRcard?

UGC Survey Results

62% of customers ‘Don’t have an Instagram account’ or ‘Never use Instagram’.

Cameo Edwards, Founder •  Suggested user generated

content via email newsleDer and social media

•  UGC can enhance customer par6cipa6on with the brand

•  In social media campaigns, providing an example for customers to imitate works best

62%

2%

3%

8%

9%

16%

Never/Don't have account

Other

Annually

Monthly

Weekly

Daily

How ORen Respondents Use Instagram

Instagram Usage

"The Hen House Linen customer is not going to be as tech savvy compared to the younger customer“ -‐Sales Associate, A Southern Season

hhl final recommendations v11

Documents

adpi source

mixingsolidsand pa

ernswith pa

dislike indierent

dopeoplelike thesolidsand

southern season

product mix

easter thanksgiving