Skip to main content

The Globe and Mail

Aldo seizes ‘put up or shut up’ moment for shoes

The shoe business is getting bloody.

At least, that's how it looks from Douglas Bensadoun's vantage point. When he talks about the way competition has increased in Canada's $5.9-billion footwear retail industry, the creative director and vice-president of marketing for Aldo Group compares it to Thunderdome, that arena in the dystopian Mad Max universe that hosted fights to the death.

But there is a difference. In Thunderdome, the slogan was, "Two men enter, one man leaves." For shoe retailers, the field of battle is far more crowded.

Story continues below advertisement

It is the reason that last month, Aldo announced the biggest investment in development that the company has made in its 41-year history. Over the next five years, it will spend $363-million and hire roughly 400 people in an effort to better market itself to customers who have more options than ever.

"We're being confronted with more competition from so many different angles at this point. It's basically a 'put up or shut up' moment," he said in an interview in Toronto, during a recent visit to accept a "Marketing Hall of Legends" award on behalf of his father, Aldo Bensadoun.

That competition is not only coming from where you would think. Yes, the proliferation of online shoe retailers – he singles out ShoeMint, ShoeDazzle, Zappos and Nasty Gal among the competitors – has complicated the business. That's not even counting online giants such as Inc., which devotes billions to research and development as it seeks to become "the everything store."

But established clothing retailers, such as Zara, H&M, Michael Kors, and Topshop, are also a threat as they have been selling more shoes in recent years.

"Apparel retailers are doubling, tripling, quadrupling down on their footwear offerings," he said. "What used to be 0.2 per cent of their projected revenues is now 5 per cent of their projected revenues … We're in a position where we need to start making some moves."

Fundamentally, Mr. Bensadoun sees this as a marketing problem.

Clothing retailers have the luxury of showing you a shoe in its proper context – in other words, as part of an outfit. One of the things Aldo is planning for its store of the future is more screens in-store that will help to do that, in the absence of any apparel stock.

Story continues below advertisement

The store could choose a top 10 looks of the week, Mr. Bensadoun suggests, which could be browsed on the screens (and on a mobile-friendly version of the same service for people on smartphones.) Those looks would specify which shoes to wear with them so that customers could pick footwear based on an overall style they identify with. It would also go the other way: for those who pick up a shoe they like, it will be possible to see how to wear it, and with what.

It's not just about showing fashionable ensembles, however; Mr. Bensadoun envisions these screens as inherently social, encouraging its customers spanning 1,600 stores in 80 countries to swap tips and submit photographs to show how they wore the shoes on the streets of Montreal, Los Angeles, or Caracas. In this way, the store could become a kind of global fashion consigliore, he suggests.

"Our research shows that 70 per cent of people who come to an Aldo store have checked out the collection online prior to getting there – 70. That's incredible," he said. "Oftentimes, they could be more savvy than the sales associate who's there … so we're trying to position ourselves in such a way as to take advantage of that knowledge and be able to serve even better. … There are big customer behavioural changes that we need to adapt to, and it's where a lot of this investment is going."

Aldo began doing research and theorizing how to make changes at the company to better compete, roughly two and a half years ago. Mr. Bensadoun points to experiments such as the "virtual store" kiosk it built in a hub metro station in Montreal, and the design of the store set to open in the Westfield World Trade Center shopping complex in New York in 2015, as signals to where the retailer is heading.

Data are another key part of this transformation project.

Part of Aldo's multimillion-dollar investment will be devoted to building a better data analytics team as well as hiring research and behaviour experts. This is a priority for all marketers, who face a buying public that has never been more inundated with messages – on television, on their mobile phones, tablets, and computers.

Story continues below advertisement

"The consumer insights and analytics department at Aldo was very much in its infancy, up until very recently," Mr. Bensadoun said.

A famous ad man once said "Half my advertising is wasted; I just don't know which half." Those were the days. With digital media exploding, advertisers are lucky if half of what they put out there actually gets noticed. Companies have more avenues to send messages to consumers than ever before, but it also creates a resounding din. To actually make themselves heard, marketers need to target messages to our specific needs, habits and way of thinking. That goes beyond advertising too: For retailers, it means getting to know consumers more intimately, in order to draw them into stores and to your website.

"When we think about the [400] new recruits … at the end of the day, it's about understanding the customer's behaviour better than we have before," he said. "We have to go really hard in a direction that we think makes sense for the future, for us. Because if we don't, we think we're really going to have a hard time surviving."


Retail store sales in footwear in recent years

2012: 5.88-billion

2011: 5.61-billion

2010: $5.39-billion

2009: $5.18-billion

2008: $5.06-billion

*Source: Statistics Canada retail store sales by commodity

Retail sales for shoe stores over the past year

Dec. 2013: $259-million

Nov. 2013: $265-million

Oct. 2013: $251-million

Sept. 2013: $247-million

Aug. 2013: $252-million

July 2013: $247-million

June 2013: $244-million

May 2013: $251-million

April 2013: $250-million

March 2013: $257-million

February 2013: $258-million

Jan. 2013: $251-million

Dec. 2012: $250-million

*Source: Statistics Canada monthly retail sales reports, seasonally adjusted

Report an error Licensing Options

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨