Timing is key in wristwatches; retailers stay fresh with trained staff, better displays

Discount Store News, June 3, 1996

NATIONWIDE DSN REPORT -- Discounters are using licensing, house labels, better displays and better trained associates to keep recent gains in the wrist-watch category growing.

Ames has introduced its own brand, Eagle Ridge, to gain better margins and differentiation in the rugged/outdoors segment. Ames displays the Eagle Ridge collection in-counter next to an outdoors/sport assortment with the Coleman license. Ames has been grooming its relationship with Coleman as a key licensed identity storewide. The 300-store chain has expanded its Coleman assortment in camping gear and sporting goods and romances the line with updated signage. Ames runs Coleman licensed flannel tops in menswear.

"These watches all tie into casual days," said Ames executive vp, gmm Denis Lemire of the rugged and sport watches. Thus they fit the bill as fashion-driven impulse buys.

A house label will also debut at Bradlees this year. John Zimmermann, dmm for accessories and cosmetics at Bradlees, said that the 124-store chain will introduce a watch line by the fourth quarter, priced in the $30 to $45 range and positioned like a Fossil or Guess fashion collection. Bradlees now regularly sells watches up to $100 and has moved its opening prices up to $20, leaving behind the $5 and $10 items of the past.

Zimmermann said that the chain had a very strong fall and Holiday in watches last year, and it planned aggressively for 1996. While first quarter sales results have been slightly down, he pointed to significant double-digit gross margin increases. Bradlees is not promoting watches as frequently as it had, and the discounts tend to be 25% rather than the typical 30% to 35% of the past.

The volume upsurge in watch at Bradlees was in part due to much cleaner merchandising. Chainwide, the departments standardized their countertop displays, resulting in a clean look and more productivity per square foot. Zimmermann noted that the clear rotating tower fixtures, which are kept locked, are easier to stock and maintain. Their eye-level positioning also works to the advantage of the products.

Now Bradlees will keep the momentum going by re-land-scaping all of the in-case displays. At least as important, the chain is elevating its counter associates to a level roughly equivalent to assistant managers. Interested associates will undergo training that includes product information, battery changing and related service issues.

The merchandise mix at the regionals generally reflects the direction of the national chains. All discounters offer some watches with night lights, either by share leader Timex or a competitor; watches with Looney Tunes and Disney licenses; and a balance of dressy metal, sporty black and rugged/outdoor assortments by mass suppliers Casio, Seiko, Pulsar, Citizen or Armitron.

The Coleman program at Ames echoes Target's in-counter selection of men's watches licensed by denim lifestyle brand Brittania.

Target also carries watches priced under $10 aimed at youthful clientele.

The most aggressive maneuver in watches to date is the test by Wal-Mart reported here last issue. In four Eastern stores, a Walton's Fine Jewelry department, completely separate from the mainline jewelry area, offers an assortment of jewelry and watches ranging from the usual Citizen and Seiko models to $1,459 Tag Heuer and Movado items.

Some question what these high-end manufacturers have in mind for their brands by test-marketing them in the mass channel's leading format. It is conceivable that these brands are concerned about the growing ability of such mass-focused makers as Armitron to quickly bring upstairs looks into mass market development at lower price points.

Were Wal-Mart ever to roll out a department offering the actual upstairs brands, it could be effective as a flanking maneuver to dampen the differentiation efforts of regionals seeking to upscale.