Vera Bradley wants to make Paisley cool again


But for Vera Bradley (VRA)The paisley pattern is its identity. The company has found an almost cult following with its cotton handbags, backpacks and wallets, which are often covered with paisley patterns in all imaginable variations. There is a "Fireworks Paisley", a "Daisy Dot Paisley" and even a quirky "Mickey and Minnie Paisley".

The company has relied on paisley printing for almost four decades, even though other retailers have more millennial-friendly items in stock. It favored bright, bold prints on its pockets because it made sense to the customer it was promoting.

"The Vera Bradley shopper has traditionally been the working mother aged 40 to 60 who likes patterns and comfortable, casual bags," said Eric Beder, retail analyst and CEO of Small Cap Consumer Research.

Then, two years ago, the company hit a hard blow.

"There were problems with the product being stale and heavily discounted to get the product out of the door," said Beder.

Vera Bradley (VRA) Revenues from stores open for at least one year, an important indicator of a retailer's health, declined by 10.3% in 2018.

The company operates around 150 shops – divided into shopping centers and outlet centers – and sells products on its website. Online sales decreased by almost 25% in 2018 compared to the previous year. Vera Bradley products, which range in price from $ 15 for a zippered case to $ 278 for luggage, have also been sold in more than 2,000 other specialty stores and department stores across the country.

The continuing decline in sales was a critical moment for a company that normally generates annual sales in excess of $ 400 million.

Beder said there was a realization that Vera Bradley not only needed to be innovative to keep his "legacy" client, but also to find a way to build a new fan base among young buyers.

"Vera Bradley is one of the largest sellers of backpacks and luggage. These articles naturally appeal to school and university children as well as young professionals," said Beder. "The challenge for the brand was to find a way to close this age gap between the main buyer and the younger buyer," he said.

The turn

Vera Bradley's CEO Robert Wallstrom, who joined the luxury retailer Saks in November 2013 after 16 years, said the company started "corrective actions" in 2018.

The most important step was to invest in product and fabric innovations to attract attention. Last year, the brand launched a new collection of bags made from water-resistant cotton that had a polished look with a mix of non-patterned solid colors.

"This is aimed at the young woman who has a degree and needs an affordable, durable first work bag," said Beder.

This may also be the same consumer who grew up when he saw her mother carrying a Vera Bradley handbag on her shoulder or a Vera Bradley suitcase to the airport. According to the company, brand loyalty is already in place. There is an opportunity to use this in a way that changes the perception that it is a "mother" brand to a brand that is relevant to your school-age daughter or even granddaughter.

Vera Bradley launched bags in January that use recycled plastic bottle fabrics.

Last July, the company acquired a majority stake in Creative Genius, the owner of Pura Vida. The online brand, popular with millennials and Gen Z, markets itself as a socially conscious brand with sustainable fabrics, The company works with charities worldwide and sells affordable handmade bracelets made by artisans from Costa Rica, El Salvador and other countries.

Purchasing gifts with social or ecological benefits was an important factor for younger customers in the past Christmas season, according to the NPD Group. The data showed that approximately 25% of 25-34 year olds and almost 30% of 18-24 year olds thought it was more important to give gifts that "give back" than was the case last year.

Beder estimates Pura Vida's sales in 2020 will be around $ 125 million.

These changes have helped get Vera Bradley back on track in 2019. Beder said the brand increased sales every quarter of the year.

Wallstrom hopes that the momentum will continue in 2020. Vera Bradley launched a bag collection made from recycled plastic bottles in January.

Analysts expect it to attract younger, higher-income, socially conscious buyers who are willing to "pay" for a product that fits their lifestyle and values.

"In many ways, the younger generation influences the generation above them," said Wallstrom.

A new Vera Bradley collection of bags made of water-resistant cotton in plain colors is aimed at young working women.

The brand is even younger and is starting to work with Harry Potter in June. One collection will contain bags, technical products and accessories, and another collection will focus on the holidays and include robes, blankets and slippers with Harry Potter motifs.

Other older brands, including the upscale home furnishing brand Pottery Barn, have also turned to Harry Potter to increase the brand's excitement and attract the attention – and dollars – of younger consumers. Pottery Barn launched a Harry Pottery decor collection in 2018 and has since expanded its portfolio of furniture, kitchenware and cooking tools.

"We have always viewed the brand as cross-generational," said Wallstrom. The effort has to be balanced now [classic] Vera Bradley with a fresher version of the brand.

"We find this balance," he said. "We have to respect what consumers want today."