Hanover Direct's Brand New Focus
For example, offers Nachemin, "Say The Company Store has a successful comforter. We may want to test it in Domestications."
While certain items such as bedding are price-point driven, making a straight test impractical, the Group may look at adapting products when it makes sense.
Nachemin refers to this as product lifecycle marketing: "When an item starts to slow down in one market, we may take it to a lower spec and move it down. For example, we're considering taking a Company Store print pattern and creating something similar for Domestications."
Hanover's manufacturing capabilities allow the catalogs of The Company Store Group to easily cross-test different levels of merchandise quality.
"We do so much of our own product, it makes what we call the 'manufactured knock-off program' possible," DiFrancesco says.
Hanover also can take the idea for a product knock-off to a vendor for input. "We work closely with the vendors that manufacture [private label merchandise] for us," says Nachemin. "We'll take an item [from The Company Store catalog] to them and say, 'can you do an item like this at a quality and price level we can sell in Domestications?'"
In pursuing this cross-over strategy, Schmid suggests that Hanover needs to proceed with caution. "Having their inventory teams work together is just fine. But in terms of merchandise, they need to keep a uniqueness to the products in each of their catalogs. There's a danger that they could lose their differentiation."
Hanover says that at the root of any new cross-merchandising ideas is an understanding of design trends. In addition to employing buyers, the brands employ in-house home product designers—for a total of six designers and nine buyers in the Group. Buyers meet with designers and regularly share information. "What's working out there? Is the trend toward geometrics or florals? They'll go to the trade shows in New York and internationally to find out what are the trends in textiles," Nachemin reports, adding that the buying and design staffs work as a team.