Howard Lester, who has led Williams-Sonoma during the past 31 years, chose a great quarter in which to retire. The company’s first quarter revenue jumped from $611.6 million a year ago to $717.6 million. Even better, the home products retailer turned an $18.7 million loss from a year ago around to $19.5 million.
“I continue to marvel at the creativity and entrepreneurship that exists in our culture and have complete confidence that it will continue to thrive under the leadership team headed by our new CEO, Laura Alber,” Lester said in a statement.
The company’s retail operations generated $411.8 million, up 15.2% from the $357.4 million it generated in first-quarter 2009. But its direct operations rose faster, jumping 20.3% from $254.2 million to $305.9 million. As a result, direct made up 42.6% of operations during the most recent quarter, up slightly from 41.5% a year ago.
This was in spite of a 3% reduction in catalog circulation, COO and CFO Sharon Mccollam said during an earnings call. And, in fact, online sales led among direct channels, growing by 24% during the year.
Within the company’s Pottery Barn brand, for example, “We have continued to shift our investment from marginal catalog circulation to Internet marketing, which is driving incremental growth and new customer acquisition,” Alber, the new CEO said during the call.
“Our new e-commerce platform continues to deliver significant benefits as we gain more expertise in utilizing its flexibility in site merchandising, optimizing natural search and further engaging the brand in social media,” Alber continued.
Alber added that during the second quarter and the rest of the year, the company would continue to focus on a variety of marketing strategies, including several initiatives in e-commerce, social media and in-store events. “E-commerce is our fastest-growing and most-profitable channel across all brands.”
Williams-Sonoma is moving its use of mailed catalogs to embrace smaller, more focused mailers. “Those allow us to reach customers more profitably,” Alber said. Mccollam added that the 3% reduction in catalog circulation was for total catalogs mailed, and did not reflect page counts.
