Channel Overview
Opening Ceremony is a specialty store located in West Hollywood. The channel type that I chose is the physical (brick and mortar) specialty store. The West Hollywood store is a shop that deals in fashion, art, and traveling products.
The store has also cleverly rolled out a traditional client interaction strategy as part of its business channel. This element revolves around investing money by offering unique and diverse products to customers who buy in the store. In addition, the Opening Ceremony’s customers have better offers due to consistent and attractive discount.
The store has always aspired to provide quality products and services to customers. The store currently offers direct sales to its consumers within admirable standards of flexibility. Apparently, the success of the physical specialty store channel forms the rationale for this research.
This channel has been customized to ensure that clients are served within the most reliable and efficient methods. The success of the channel could be attributed to its partnerships and quality assurance to its diverse customer segments. I am interested in this type of store because of the unique merchandise categories it carries. Besides, I want to run a store like this in the future.
Background of Opening Ceremony in West Hollywood
The Opening Ceremony store was founded in New York by UC Berkeley graduates Carol Lim and Humberto in the year 2002 as a joint partnership venture. After a trip to Hong Kong, the dynamic duo decided to start the company through the integration of the Olympic Games mission statement, which is to adopt a multinational strategy to their retail business.
The company is renowned for retailing household and emerging fashion designs. The designs range from known brands to small brands that are emerging in the domestic and international market. The Opening Ceremony has branches in New York (headquarters), Los Angeles, Tokyo, and London.
Each year, the store in West Hollywood, Los Angeles has activities that showcase the originality and quality of merchandises form different countries across the world as a result of it strong partnership approach in market expansion. As a result, the specialist store has been able to proactively transform the Los Angeles store into an open and expansive market for international capacity and exotic souvenirs.
Over the years, the company has been consistent in growth within its business mission “of exploration and friendship, working with a family of contributors to forge a creative environment that reaches far beyond the fashion world” (Opening Ceremony par 3). Among the collaborating brands that have made the Opening Ceremony to expand its scope of operations include “Rodarte, Topshop, Pendleton, and Maison Martin Margiela” (Opening Ceremony par 3).
The most renowned projects that are carried out by the Los Angeles store include “Spike Jonze, Terence Koh, and Chloë Sevigny” (Opening Ceremony par 4). As a result of the consistent growth over the years, the store in West Hollywood has become very popular with customers within the age of 15 and 40 years.
Customer Service Philosophy and Programs
The store operates from 8.00 am to 8.00pm every day. The most notable CRM strategy adopted by the Opening Ceremony is the contact management since it provides a decision support system to select the best market access on suitability, distribution structure, and integration of contact channels among the customers.
The contact management system in the store takes the form of Debit card services and a 12-hour call center to connect to their customers (from 8.00am to 8.00pm) (Opening Ceremony par 3). This system is constantly upgraded through value –added services. Keeping these channels restricted has helped the store to boost customer confidence in keeping their particulars safe.
In order to guarantee customer satisfaction, the Opening Ceremony’s contact management system is built using standard operating procedures to promote consistency in processing customer orders and all other channels. The more the consistency, the more the information that can be shared amongst various channels creating more business resources to be used in customer service delivery.
For instance, the Opening Ceremony’s call center has been successful in addressing client concerns in a timely and professional way (Best Buy, par. 5). Opening Ceremony has employed the laggard activism strategy to not only capture the global market, but also leapfrog its dominant competitors. The store operates on the Customer-to-Customer (C2C) platform and Business-to-Business (B2B) platforms.
As a result, the Opening Ceremony has penetrated the fashion market due to a balance in factors such as the Western business style, global business approach, and flexible business channel. In order to penetrate the expanding market, Opening Ceremony’s business platform includes services such as premium customer experience, compact support from the local community, and low charges for loyal customer.
For instance, the Customer-to-Customer platform adopted by Opening Ceremony has created and successfully implemented the marketing strategy to ensure customer loyalty and market expansion. The company’s product multi-branding as a positioning strategy has enabled it to survive competition. For instance, the direct shopping is tailed to address the individual customer needs.
Besides, the company has managed to balance the elements of intangibility, inseparability, and heterogeneity in the 4Ps of its market mix due to improved product visibility for each target customer segment (Rai 23). The goal of these CRM strategies at the Opening Ceremony is to concentrate on the local market through use of an open-system business model.
The strategy was meant to take advantage of the challenge of ‘smallness’ as compared to other giant specialty stores offering similar products. The store depends on the closed-system approach in execution of its business strategies. Unlike other stores which developed a fixed entry strategy in the market that was characterized by overconfidence and inertia, the Opening Ceremony was packaged as a humble and flexible fashion products trading platform (Opening Ceremony par 5).
The Opening Ceremony store has made the shopping experience an easy task with its strategy of all-under-one-roof, from renowned designer products to upcoming designer products. A customer is in a position to literally find all types of fashion products within a single location. This saves on time besides allowing a customer to plan for a single shopping activity that covers for all his or her needs.
To support this mission, the store has one of the most attractive reward plans for its loyal customers in the form of shopping points that are redeemable, seasonal discounts, and annual rewards. For instance, the store has special promotions and discounts on holidays such as Christmas Day, Thanksgiving Day, Independence Day, Black Friday, and spring sale.
In addition, the store has special vouchers that target corporate organizations and private customers. The offers are in the form of price, quality, and quantity. The store has a 24 hour return policy for goods sold as long as the product is returned in its previous condition (Opening Ceremony par 7).
In summary, the Opening Ceremony has the best CRM strategies since they are incorporated in the offline customer management systems. For instance, adoption of the hybrid system of customer service management by the Opening Ceremony is meant to ensure direct contact with customers within the shortest time possible. The hybrid system is very successful in contact management and positive attitude reassurance at the store.
Employee Relations, Philosophy and Programs
In the Opening Ceremony store, there is a laid down structure formulated in order to keep its staff in healthy and stable mind in their duty of serving the store’s interest. A stable mind performs optimally with little or no supervision.
In line with this, store always work alongside its staff to promote healthy working habits by recognizing and where necessary supporting staff that make a steady commitment in practicing accepted desirable healthy habits in their work department. At the Opening Ceremony store, programs are periodically designed in line with objectives and goals for sustained happy employee-employer relationship.
The methods used at the Opening Ceremony include direct participation by the employees, who after interaction with each other identify hale and hearty workplace interventions, and promotion of health organization culture through different training programs (Opening Ceremony par 8).
The Opening Ceremony store has attractive employer paid benefits that offer health cover, mileage, work compensation, retirement, and disability among others. The compensation plan for the Opening Ceremony inspires optimal performance through job satisfaction since the total annual compensation and different benefits are relatively attractive.
Besides, the store has a continuous 401k retirement plan for employees. Each year, employees are given the opportunity to buy 1% of the Opening Ceremony stocks at a discount of 10%. The actual hourly salary for the sales associates is $50, besides a comprehensive medical cover and annual salary increment of 5% of the previous year salary (Opening Ceremony par 9).
The corporate governance structure of the Opening Ceremony store has a strong system for promoting the elements such as culture, structure, systems, and strategic alignment among the employees. The compensation plan for the Opening Ceremony store are aligned to a supportive work environment, concrete learning processes, and personal development that reinforce competency.
The company has annual promotion plan and continuous employee training program. The promotion is based on performance and academic qualifications. The training program is in-house and is managed by the HRM department (Opening Ceremony par 6).
Employee selection at the Opening Ceremony is focused to evaluate resumes of applicants for essential requirements which in this case include possession of management and analytical skills in fashion design environment. In this case, the process is systematic, and through aptitude test, elimination of those lacking analytical skills is possible within minimal prejudice or biasness. In the Opening Ceremony store, social and highly skilled employees are allocated the right duties than keeping them in a secluded environment (Opening Ceremony par 4).
Conclusion
Apparently, the store has the strengths of strong brand presence, expansive distribution channel, diverse product multi-branding, and strong customer base within the specialty channel. However, there is strong competition from similar stores such as Satine, Boutique, Madison, and Kitson. Besides, the store operates in a dynamic market where changed customer preference may negatively affect its profitability.
Works Cited
Rai, Alok. Customer Relationship Management: Concepts and Cases, London, UK: Kogan Page, 2012. Print.
Opening Ceremony. About Us. 03 Dec. 2014. Web.