The US sunglass and sports eyewear leader has announced a unique 4-channel strategy, using 4 different types of ?internet storefronts? to win over more customers for its diversified range of products, to raise customer awareness of the Oakley brand and to improve customer service.
The company's corporate website, www.oakley.com, has been redesigned and relaunched, featuring the entire range of Oakley branded eyewear, footwear, apparel and accessories, available for direct selling via the internet to US-based customers, but a dealer locator will direct consumers to the nearest retailer. Shipments to key markets outside the USA will be offered in the course of 2000.
Until now, Oakley had been using Eye Vault as its own exclusive online retailer for sunglasses and goggles, while offering accessories through its own O-Store online shop. Sales through these channels were close to $1 million in the 4th quarter ending Dec. 31.
A second channel of distribution is represented by ?click-and-mortar? partners. These are traditional retailers, including Sunglass Hut, which have also an e-commerce operation of their own and which are now allowed to carry a limited assortment of Oakley products on the Web. All based in the USA, they are, besides Sunglass Hut (www.sunglasshut.com), Recreational Equipment Inc. (www.rei.com), Cold Fusion (www.fusion.com) and Chaparral Racing (www.chaparral-racing.com).
The third storefront involves a small number of pure e-tailers that sell exclusively through the internet. The first one to have been chosen to carry Oakley's full line of high-performance products is Fogdog Sports (www.fogdog.com), a US electronic retailer that recently went public with the backing of Nike. Fogdog is expected to establish a European operation sometime next spring.
The fourth channel will consist of carefully selected ?affiliates? who will be authorized to establish on their own websites a hyperlink that will take the visitor directly to Oakley's own site. If the visitor purchases any Oakley product from Oakley.com during the session, the affiliate will get a percentage of the purchase price.
Oakley says it has invested considerably on hardware and software to take advantage of the 24-hour real-time convenience of e-commerce. Sun Microsystems, Oracle Corp., Vignette and Exodus Communications are among the suppliers. The new front-end technologies have been integrated with its own SAP order processing, manufacturing, inventory management, distribution and finance modules, which have been implemented sofar in the USA, Canada, Japan and France to ensure same-day shipping of small quantity orders. Oakley is evaluating caching technologies to optimize site performance and to accomodate its growing non-US traffic, which now represents about one-quarter of all user sessions.
Separately, Oakley announced last Dec. 15 that its board of directors had authorized the purchase of up to $20 million worth of its own common stock in the open market if the share price runs below $9. The authorization is related to a stock repurchase program initiated in October of 1996. The board had authorized then the acquisition by Oakley of up to 3 million of its own 70,588,457 outstanding shares, but in the end the company bought only 756,000 shares through March of 1997. Last Dec. 14, Oakley bought an additional 89,600 shares based on the new authorization.