Milestone: Retail Fitness Test

Famous Footwear is forging ahead with new store openings, including the launch of a fitness retail concept next month.

To capitalize on the success of the toning and wellness category, the company is preparing in November to roll out five test locations called Mind Body Sole.

“We’re always trying to find better ways to connect with customers,” said Rick Ausick, president of Famous Footwear. “We keep challenging ourselves [through] testing, [to see] how [the idea] will translate into the future.”

The company will experiment with two different models, including full-service and open-stock formats. Both will offer selections of toning, running, outdoor and fitness footwear for men and women.

The first Mind Body Sole units will be mall-based locations and will open in Burlington, Mass.; Denver; Tulsa, Okla.; Orlando and Palm Beach, Fla. Store sizes will average 2,000 square feet.

The general look and feel of the store is designed not only to help consumers shop for fitness products but to encourage them to lead healthier lifestyles, Ausick said.

“Mind Body Sole provides a unique opportunity to connect with consumers in a new format, with a new model and with [fresh] customer engagement strategies,” he said.

As for standard Famous Footwear stores, Ausick said the company is being cautious about building.

With the poor economy and the uncertainty of the real estate market, he noted that the team is still searching for the best markets, making it too early to name specific locations or cities for new store openings.

However, the retail chain, which operates 1,126 stores nationwide, including 947 Famous Footwear locations and 179 outlets, does have plans to bow 126 stores by the end of 2012.

An estimated 26 locations will debut this year, and the company said it plans to match the number of openings with the closings of underperforming stores. Recent store openings for the back-to-school season were in Colorado Springs, Colo.; Wilmington, Del.; and Lincoln, Neb.

“We only want stores that are profitable on our list,” said Ausick. “As malls change and age, we will relocate to a better spot and improve productivity. We’ll find ways to [stay current] in the real estate [market].”

Sam Poser, an analyst at Sterne Agee, said the plan to open and close the same number of locations is a reasonable strategy, but ultimately, the most important tactic will be to stay ahead of the footwear trends.

“It really depends on how well they meet the demands of their customers in their markets,” said Poser. “We’re in a very good time for trends with boots and athletics, and that plays right into their business.”

The majority of Famous Footwear’s locations are in strip centers, malls or outlet centers, and for now, the firm has no intention of changing a strategy that is working well, said Ausick.

“We rely on other tenants to help bring traffic to the mall. It’s nice to be surrounded by people who sell complementary things,” he said. “There is a more natural traffic pattern; that’s the base of our business and where we [plan to] keep focusing.”

Many of the stores also operate as testing locations and use a variety of fixtures and packaging methods to determine the most effective setup. The company conducts surveys and hosts focus groups to gather customer feedback.

“There is always some version of product testing going on,” said Ausick. “We’re continuously finding ways to make the experience better.”

As part of the in-store experience, the design is also continuously being tested. Famous Footwear uses a variety of configurations based on space, but the average store size is about 7,000 square feet.

Overall, Famous Footwear aims to tell a product story through fixtures and with additional signage along the walls, illustrating hot product trends in the market, and ones that consumers should consider to stay up to date and fashionable. “There [are] stories about a trend item or category, and a lot of those are brand-driven, so it’s relevant,” said Ausick.

Meanwhile, the product mix is universal across about 60 percent of the storefronts, while the remainder is customized based on location, weather, seasons, local issues and specific business needs.

The overall décor is kept simple, so the stores are easy to navigate and employees can better connect with the customer, according to Ausick.

“We want to make sure we [direct the customer] and keep her connected to our brand,” he said.

Looking ahead, the company plans to rebrand its factory stores, including 80 stores, before the end of the year. The name and signage will change at the outlet locations, from Factory Brand Shoes to Famous Footwear, but the concept will remain the same.

Overall, a main focus in the future will be the launch and establishment of the Mind Body Sole retail concept, which is likely to become a big part of future business, said Ausick.

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