The Rack Room Shoes name says a lot about what customers can expect when they walk in the door. For decades — since founder Phil Levinson’s son-in-law, Mort Lerner, created the banner — Rack Room has displayed its inventory in easy-to-access shelving units that help families browse and try on all the latest looks at their own pace.
In recent years, it has enhanced the in-store experience by introducing The Athletic Shop, a shop-in-shop concept, and the dedicated Kids Club area, to make shopping more targeted and efficient.
But even more change is in the works, timed to the retailer’s 100th anniversary.
“We’re very happy with the current design of our locations, but we know there is more we could be achieving, so we’re working to evolve our stores,” said president and CEO Mark Lardie.
For the first time, Rack Room is bringing together leaders from multiple departments, including marketing, merchandising, operations and digital, to participate in the development of the retailer’s next stage.
Chief marketing officer Molly Hartney said, “The new store design is a very big project for us, and it’s a cross functional project. We’re all kind of playing in a sandbox together, exploring what a fresh store concept could look like.”
She noted that discussions kicked off in January 2022 and are progressing quickly, with plans to begin testing features this fall in the chain’s Concord Mills location in North Carolina. A bigger rollout is set to commence in early 2023.
Brian Burnett, EVP and GMM of Rack Room, described the new look as “halfway between a revolution and an evolution.” He explained, “It’s challenging — you want someone to walk in and feel like it’s still Rack Room, but you also don’t want them saying, ‘This is just a new coat of paint.’”
While the team remained mum on specific details, they did share that the stores will more seamlessly integrate digital and service elements, such as buy online, pickup in store (BOPIS), which Rack Room has invested in since the start of the pandemic.
Lardie pointed out that BOPIS usage declined somewhat after lockdowns ended, but that trend has reversed in the last six months amid supply chain uncertainty. “We’re glad that we spent the money, effort and energy to be proficient at it, especially as it’s now on the rise again,” he said. “Those things we learned during the pandemic, as we ramped up our digital capabilities, are doing nothing but helping us as we go to the future.”
As for merchandising, Burnett said the stores will reflect a more localized approach. “I want to make sure that the product is relevant and relates to the consumers that are shopping that market — and hopefully get elevated product that you won’t see online or in our other stores. We’re trying to make it special.”
Hartney added, “We don’t mean to be a disruptor in our space. It’s not a 180 from how we service her today, but in a different fashion that will inspire and delight her to shop.”
Lardie said Rack Room remains very bullish on the future of brick-and-mortar shopping and aims to continue expanding its presence by adding 3% to 5% more units annually, with a concentration on the southern U.S. states.
He acknowledged, though, that this is a digital age, and it’s important to adapt to the way consumers shop today — and one of those new ways is pre-shopping. The retailer reports that 87% of Rack Room customers pre-shop the internet before going to its stores. “So we need to make sure that our digital experience satisfies those needs of hers, that she’s able to quickly access the information she needs to make a purchasing decisions,” he said.
But even as Rack Room embraces e-commerce, Lardie said its digital strategy will always be built around the idea of driving revenue in stores. The retailer’s e-commerce site only displays product available in its physical locations.
Lardie acknowledged that such as an approach limits the retailer’s reach, but has worked well so far. “About 83% of our digital sales happen within a 10-mile radius of any of our stores, so clearly we resonate with loyal customers, because she’s familiar with and trusts our brand from her physical experience,” he said.
