Hills strengthens its soft lines niche

Discount Store News, Sept 15, 1997 by James Mammarella

LAS VEGAS -- Hills Stores, which used to have a franchise in toys, juvenile products, and family apparel, is focused on gaining back its destination status in those categories. The work is well underway in apparel, as discount shoppers in the Great Lakes and Ohio Valley regions are seeing a better fashion quotient and a tremendous breadth of assortment at Hills.

Under the direction of recently elevated executive vp, cmo Larry Angst, Hills is migrating from its former "regional gazelle" approach toward lifestyle merchandising. While the chain will still act quickly to jump on trends, Angst wants to make sure that every key apparel category is well developed at all times and presented in easy-to-understand displays. Within that structure, Hills merchants can amplify trends.

"We're seeking a validation of trends, but we're not jumping on them," vp, gmm, men's and kids' Manny Francione told DSN, Fashion jeans are a recent example. "That first reaction this summer has been positive," he said, "so now we'll blow that out in the fourth quarter."

But the position in fashion jeans has evolved as more than a flash-in-the-pan for the chain. Wide leg and carpenter-cut denim is just part of a lifestyle presentation that Hills tested in most stores: setting up departments specifically geared to juniors customers, who have traditionally not shopped at discount for apparel.

Knowing that the younger female shopper is in the store for cosmetics, fragrances and consumer electronics products, Hills decided to test its ability to market apparel to her boldly, in the front of the store.

"Juniors has been spectacular at Back-to-School," said Francione, referring to the success of Hills' creation of "juniors' world," which was directed by Angst.

"We may test similar layouts for the younger male," Francione said. Menswear merchandise manager Rich Toback pointed out that rather than sign the next test "young men's," HIlls would stress the "youthful, energetic" aspects of a denim-driven assortment.

Elements will include "carpenter silhouettes, street-hip styles with wider back pockets, not taping, but some mixed fabric inserts," Toback said. He said nylon is the hottest trend in activewear. "Mesh is good, especially inserted into nylon and jersey. There's a lot of layering. One item," he noted, "is breakaway pants, with snap sides."

Key to the younger assortment is the Hills private label heavyweight jersey/fleece/ nylon suit and separates line Pro Sport. Launched in boys' in the second quarter of 1997, and rolling out into men's, Pro Sport will likely be added to the ladies' side for 1998. Pro Sport is a means to lift Hills' activewear division out of the commodity price-driven mode, Toback said.

Hills makes a play fro better goods in licensed team sports apparel. "That business is okay especially as we move toward a nicer mix," said Toback. "We see 50% higher prices than for the rest of our mix."

Team sports are micro-oriented. "Our team strategy is that we've got to be team-dominant in team-dominant markets," said Francione. "So we'll have the Steelers, Penguins and Pirates in Pittsburgh."

In stores located in pro team strongholds, Hills gives ample space, another lifestyle emphasis.

As Hills gets a better grasp on merchandising direction, the company has bolstered its team by three recent hires.

Two report to Angst:

* Gregory Jones, senior vp marketing and sales promotion. Jones joined Hills from Carpet One, a $2 billion cooperative of floor covering retailers. His background includes posts with Circuit City and Today's Man. * Michael Dahl, vp, product development. For more than 20 years, Dahl has worked with chains as diverse as Casual Corner, Dress Barn, Lerner Woman and ShopKo. He most recently oversaw the direct import efforts of women's sportswear vendor Orbit Industries.

The third exec reports to executive vp, cfo Scott Litten:

* Jim Fitzpatrick, senior vp merchandise planning and control. Fitzpatrick returns to Hills after several years at Montgomery Ward, where he first worked as senior vp, finance at the hard lines Lechmere division, then as vp, hard lines replenishment for Ward.

The most immediate, visible impact from the three new hires will come from Jones. Hills has vacillated in its image campaigns, veering from its everyday low price roots into high-frequency promotions, and now back again toward an emphasis of constant values.

Hills president, ceo Greg Raven said the company was attracted to Jones by his depth of experience in strategic positioning and market research. "He's not coming on just to run our advertising programs," Raven said. "He will be more strategy-focused. We must better position the company, with the merchants, the product development side and senior management all aware of and committed to out niche."

Raven said Hills will continue to phase in more wire-weld fixturing during 1998, The display system can show more inventory on the floor while upgrading ambiance.