Express Posts 5th Consecutive Quarter Of Positive Financials; Gains Market Share

While it was clearly below the company’s expectations, ExpressEXPR
CEO Tim Baxter, said the retailer is happy to be posting today the 5th consecutive quarter of positive financials.

“Our focus is on the four foundational pillars of the ExpressForward strategy,” said Baxter. “We’ve revised our outlook down, given what we’re experiencing in the form of a macro-economic downturn.

“We’re focused on versatility and value,” added Baxter, citing rampant inflation consumers are facing at the supermarket and gas pump. “We’re regaining a leadership role in fashion, and gaining volume share across some pretty significant product categories like denim.”

Baxter said Express has also successfully reinvigorated the brand through product and a complete reinvention of the marketing model. “We have over 1,000 style editors in our Community Commerce program,” he said. “From a customer standpoint, we’ve been very focused on engaging existing customers and acquiring new ones.”

“The latter has been facilitated by last year’s relaunch of the Express Insider Loyalty program.” It’s really powerful,” Baxter said. “They shop more often and spend more money. We’ve attracted over 4 million new customers since last year and reactivated 3.2 million lapsed customers.

“Execution is the fourth pillar,” Baxter said. “We’ve been operating in unprecedented and uncertain times with discipline [and creativity]. “I’ve said that reinvigorating the brand will take the longest time. We’re a 42-year-old brand. When you’re 42 years old, people have strong opinions.”

The retailer is expanding its Express Edit format, a smaller-format store with a curated selection, which has shown promise in attracting new customers and reengaging lapsed ones who hadn’t thought of the brand in some time. The Edit stores are reactivating lapsed customers at much higher rate than traditional units.

Express is opening six new Edit locations in 90 days “in powerful very high traffic cities,” Baxter said. “Right now we only have one store in Manhattan, in Times Square. We have a lot of work to do and are opening two Edit stores in September on Broadway in between Aritzia and Lululemon and across the street from Zara and NikeNKE
.”

Express Edit stores are also planned for Manhattan’s Flatiron District, Newbury Street in Boston, Walnut Street in Philadelphia and Lincoln Road and Brickell City Center in Miami.

“Today, Express is transforming from being seen as a store in the mall to a brand with a purpose powered by a styling community. Past business results show the strength of the strategy,” Baxter said, referring to ExpressWayForward, which was launched in January 2020.

Part of the The ExpressWayForward plan includes growing the digital channel to $1B in 2024. Express has continued to drive towards this goal and is on track to achieve its target of ecommerce demand, Baxter said.

The approach continues to be guided by knowing its customers and connecting with its customers, leveraging data to provide more relevant and personalized experiences and building a community with tools for customers to easily inspire each other and drive the brand’s evolution to a styling community.

The ecommerce plan is based on 4 core ideas: Personalization, or taking all customer data (what they browsed and bought, their loyalty status, etc.) and putting it to work; Omnichannel Execution, a commitment to making improvements on every screen customers and associates use; Styling and Fit Experience: enhanced product pages featuring an outfitting recommendation tool, UGC from Express customers, influencers and Digital Stylists, and Community Commerce.

A Baxter called Express Community Commerce, a first-of-its-kind social commerce experience announced in July 2021 as the next evolution in its larger brand transformation and goal of $1B in ecommerce by 2024.

The brand named global fashion authority Rachel Zoe as Lead Style Editor in November 2021. Zoe has curated two dual-gender collections in December 2021 and February 2022, and introduced two design collaborations in April and May 2022, and hosted a live event in Q2 2022.

“Rachel is our lead style editor,” Baxter said. “She played an integral role in building our styling community in our Community Commerce area. She provided master classes and in-store guidance to stylists in California. Her leadership and mentorship has been incredible. Rachel really personifies our band purpose, which is to create confidence and inspire self-expression.”

Express is currently involved in a collaboration with Simon Spur, a CFDA award-winning designer. “We did a denim collection with Simon that launched online this month and we’ll be featuring a tailoring capsule Simon will be launching next month. He’s an amazingly talented designer. Collaborations have been really successful for us,” Baxter said.

The Express styling community is the cornerstone of the ExpressWayForward, from product stylists design to the content they create and the connections they make. Marketing has been a powerful strategy for bringing new people into the brand and for helping lapsed customers to rediscover Express, Baxter said.

Over the last year, Express’ storytelling has expanded on platforms most relevant to Millennials and Gen Z, and they’ve evolved their content through influencers and social media channels.

The Brand continues to successfully engage existing customers and acquire new ones since the loyalty program relaunched in early 2021. As of Q2, Express ended with the highest number of active loyalty members in company’s history.

The most recent campaign was Destination: Express (Q2 2022), a Q2 social program that included a multi-part content series encouraging customers to share their style in celebration of summer occasions and travel to new destinations.

“We’re proud of the fact that we serve a very wide range of consumers,” said Baxter, noting that he refers to clients as, Generation Express. “We don’t believe fashion is about an age,” he said. “Men and women in their Sixties and Seventies are every bit as or more stylish than people in their Twenties.

“Our sweet spot is young professionals,” Baxter said. “We really win when we capture young professionals, people transitioning from school to career. That’s our sweet spot.”

According to Baxter, there’s been a huge resurgence in modern tailoring, which bodes well for the retailer’s success. Despite the fact that a return to offices is still an unknown, Baxter said, “Our men’s business is outstanding. It posted double-digit increases in the second quarter.

Core suiting comes in Express’ modern fabrications. “We sell navy blue and black suits, an incredible range and breath and incredible value,” said Baxter. “We’re a very powerful player in tailoring as well. We’re seeing a huge resurgence in tailoring. The suit is a trend in women’s.

“We expect to drive the category more aggressively,” the CEO noted. “We launched the Editor Pant in 2003, and it’s been an incredibly powerful pant for us. We’re introducing edited and reimagined versions.”

Baxter admitted that the retailer didn’t have enough tailored suiting in women’s in the second quarter.

“We’re a product-first company,” he said. “I’m most excited about the versatility we offer in our assortment. We’ve long been known for tailoring and occasion products. We’re gaining market share in denim and winning in mens’ polos, chinos and short sleeve shirts. We’re gaining market share in categories. That’s what I’m most excited about.”