Right: Todd Treonze, CIO of Brooks Brothers
As a 200-year-old brand, Brooks Brothers is no stranger to changing with the times and remaining relevant. With constantly evolving shopper needs requiring retailers to adapt quickly to changes more than ever, Brooks Brothers made the decision to integrate AI across the supply chain. After implementing the AI-powered RETa.i.L platform from ORS Group, the fashion brand:
- Reduced lost sales 87% due to improved stock visibility and allocation across stores;
- Reduced total inventory 6%; and
- Gained a greater understanding of which products have the most price elasticity.
Brooks Brothers leverages the ORS “buy anything, get it anywhere (BAGA)” feature to react more quickly to fluctuating in-season demands, all while managing fulfillment across its stores to get customers the right product as quickly as possible. Since launching the BAGA feature in summer 2017, Brooks Brothers has driven in an increase in North American sales, higher sell-through in women’s categories by making more product available through the web site and an increase in conversion rates.
“From a customer experience perspective, being able to provide complete visibility both online and in-store to all that inventory was a big win for us,” said CIO Todd Treonze during a session at the 2019 Retail Innovation Conference.
The apparel retailer can even now ship online orders from stores for same-day delivery. Overall, the retailer now averages three to four days delivery time, said Treonze.
“When somebody’s in the store and they’re fulfilling an order, or somebody’s in the contact center and they’re supporting a customer, they’re using (our new distribution model) for that,” said Treonze. “All of the logic related to the inventory and what store does what is being driven by ORS. Our legacy order management system didn’t have the scale to take us global, which is where we’re headed next, so we’re actually rebuilding the integrations with all of the logic that resides in the BAGA platform at ORS with our new order management system as we speak.”
In the session, titled: How AI Is Transforming The 200-Year-Old Brooks Brothers: A Customer Success Story From ORS, Treonze also noted that the retailer is examining the idea of adding new distribution centers in less populated areas of the U.S. such as the Rocky Mountain range.
With the platform, the Brooks Brothers team has the ability to manage decision-making around what locations are being used from an inventory fulfillment standpoint based on algorithms that detect store capacity, as well as both store and online demand.
Treonze noted that the addition of AI helped significantly due to the increasing competition from newer companies such as UNTUCKit and Bonobos, both of which had more aggressive pricing models. In having to answer the ever-difficult question, “When do you take markdowns?” Brooks Brothers now performs promotional analysis to make better pricing decisions both before and within season.
“When we do analysis on a category like outerwear, which would be higher-priced items like coats in the wintertime, if we adjust the price, the demand stays the same,” said Treonze. “For us, it doesn’t make sense to reduce the price on those. We keep those at a higher retail price, because when we look at the trends and volumes, they sell the same at the higher price as they would in the lower price. There’s not a lot of elasticity there versus something like shirts.”