Oroton highlights sales strategies for start-ups

Australian luxury label Oroton was among the top local retailers in 2011, increasing revenue by 12% despite the retail downturn, suggesting start-ups can learn from the 73-year-old company.

Speaking at the company’s annual meeting in Sydney yesterday, OrotonGroup chief executive Sally Macdonald said the company increased revenue by 12% to $164.4 million this year.

Macdonald said while the apparel market is “reasonably soft”, consumers will continue to reward those who are creative and innovative.

“Consumers are savvy. You can’t market your way out of tough times… You have to be more innovative and creative,” she said.

StartupSmart highlights Oroton’s key sales strategies:

Tell a story

Oroton was founded in 1938 by Australia businessman Boyd Lane, who quickly established himself at the forefront of his field, importing and wholesaling quality textiles from Europe.

Throughout the decades, the company has consistently upheld its image as a homegrown luxury label, attracting a cult following whilst gaining attention on a global scale.

With a portfolio including handbags, umbrellas, knitwear and shoes, Oroton highlights its rich heritage with classic product lines but ensures they tap into current trends to maintain interest.

Meanwhile, creative director Ana Maria Escobar has collaborated with animator Craig Redman on Oroton’s modern holiday campaign, including product packaging and in-store displays.

Be active online

While Oroton’s bricks-and-mortar stores are a key part of its offering, it hasn’t been shy about heading online. According to MacDonald, the online store will continue to be a major focus.

“Online is giving Oroton greater access to a consumer pool that their store network previously did not allow for, which is bringing very strong sales through the online channel,” she said.

Oroton actively engages in social media and utilises online “outlet” sales to clear merchandise and build a rapport with its database of customers.

Look outside Australia

The company’s expansion into Asia highlights its recognition of a new type of Asian consumer, who has more discretionary income and is increasingly influenced by Western culture.

The company is aiming for at least 10 new stores this financial year, with six already opened and the balance to open in Asia in coming months.

Downsize

While the company has flagged four new stores for the Asian market, it has made no secret of its plans to close less profitable shops when their leases expire.

The company has already closed one store in New Zealand, while another store in Australia is earmarked to shut in May.

“We are contemplating other store closures on lease expiry,” Macdonald said.

“[While] these stores are profitable, with the extraordinary growth of online, we believe it makes strategic sense to close some lower volume stores at expiry and expand some stores in strategic locations to showcase our full range.”

“We may continue with some existing stores but with shorter lease periods or more flexible terms.”

Don’t stand still

Oroton continues to attract consumers with new bolt-on categories such as shoes, fragrances and apparel – including trench coats – with plans to launch dresses and suits in January.

The company has also introduced an iPad cover for women but, as with everything, it refuses to introduce “anything cheap and nasty”, taking time to find the right manufacturing partner.

Macdonald said it’s important to surprise customers, regardless of how established your brand might be, rather than hold your breath and hope for the best.

“We are not cutting back on staff, services or inventory… We’ve got our running shoes on and are willing to roll with the punches,” she said.