Rack Room Shoes: 100 Years Forward

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At Your Service

I

t is certainly rare to

pride in their stores. Often, I think we are not a chain

celebrate the 100th

of more than 500 locations but a confederation of 500

anniversary of anything,

individual owners. They know their stores and their

much less a retail brand.

customers, and work tirelessly to tune each experience to surprise and delight our guests.

This year, however, marks

It has been the honor of my career to have helped

Rack Room Shoe’s 100th year of continuous business.

steer this mighty brand over the last decade. I have

Speaking for all 6,000 Rack Room Shoes associates,

been fortunate to work with a passionate and

I couldn’t be prouder, not only in celebrating this rare

committed group of senior executives. They challenge

milestone, but marking the event while on track to

and demand a complete effort by all who steward

deliver our biggest sales year ever.

Rack Room Shoes. They feel in a deep way that they are a part of our rich history and who we are today.

Mr. Phil Levinson, our founder, could never have dreamed what life would be like in 2022, much less that

More importantly, their commitment is what prepares

his little shoe store would evolve into a 500-plus chain

Rack Room Shoes for tomorrow.

of dynamic family footwear stores located in 36 states.

Retail is a relentless profession. Each morning, our

The digital age and speed and availability of information

stores must reopen and be ready to “serve the people”.

has created all sorts of changes at Rack Room Shoes and

That company mission statement has been in place

Off Broadway Shoe Warehouse locations. The millions of

from the very beginning. It has grown in meaning from

data points we know about our stores, our inventory, our

our customers and associates to include our partners

associates and, most importantly, our customers, could

who help our company shine. It also refers to the

never have been imagined in 1922. Today, that data drives

people in the communities we serve. Rack Room

intelligent decision-making around assortments, store

Shoes, through our Rack Room Shoes Gives program,

design and experiences that make Rack Room Shoes the

helps funnel more than $1 million in free shoes back

destination for family footwear shopping.

to the communities we serve through our partnership

The only way a brand can survive decades, much

with Shoes that Fit. This connection to our local

less a century, is to move forward, evolve and stay

communities helps remind us of our responsibility to

current. Rack Room Shoes spends millions of dollars

act locally even as we serve much of the nation.

annually to ensure we keep pace with the latest retail

Mr. Levinson probably wouldn’t recognize

technologies, as it enhances our ability to service our

Rack Room Shoes today, or even his community of

business partners and customers. Our stores are

Salisbury, NC, that we still serve. What he would

continually in a rotation to update, expand and improve.

recognize and value, though, is our relentless focus

We are always working on the next store design and

on the customer, providing our families with the shoes

how it can provide a better experience for everyone.

they want from the best brands, at a price they can

Families shop us for our great assortments and

afford. This guiding principle, to “serve the people”

tremendous value, but they come back because of our

will keep Rack Room Shoes moving forward for the

people. Our sales team is experienced and takes great

next 100 years.

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Years to Remember 1922 Phil Levinson opens Phil’s Shoes in Salisbury, NC.

1956 Phil’s son-in-law, Mort Lerner, begins working at the store and eventually opens Lerner Shoes and Rack Room Shoes.

1984 Deichmann Group acquires Lerner Shoes and Rack Room Shoes.

1986 Expansion beyond the Carolinas begins in Georgia followed by Florida and Pennsylvania soon after.

1990 The 100th location opens.

1994 Rack Room Shoes opens the doors its 200th location and expands to Indiana and Ohio.

1995 The company relocates its headquarters from Salisbury to Charlotte, NC.

2000 300th store opens.

2002 Rack Room Shoes acquires Off Broadway Shoe Warehouse.

2004 The brand begins using real people in all of its advertising through its Models Wanted campaign.

2007 Shoes That Fit charitable partnership begins. To date, 450,000-plus pairs of free shoes donated to students in need.

2011 Launch of Rack Room Shoes Gives, the philanthropic arm of the company.

2013 The brands introduce ecommerce sites and Rewards Programs for Rack Room Shoes and Off Broadway Shoe Warehouse customers.

2016 Rack Room Shoes debuts the Athletic Shop, a shop-in-shop concept that highlights active lifestyle brands.

2018 Kids Club, one-stop shop in store and online offering a huge selection of children’s shoes, is debuted.

2022 The company celebrates 100year milestone anniversary. “Our guiding principle to ‘serve the people’ will keep Rack Room Shoes moving forward for the next 100 years.” -CEO Mark Lardie

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Recipe for Success

T

here are no hidden ingredients to the Rack Room Shoes recipe. While special gimmicks or over the top promotions might add an element of intrigue to some companies, Rack Room Shoes has attracted loyal shoppers for 100 years running with proven ingredients for anyone to see. That said, how those elements are seamlessly blended, continually monitored and tweaked (when necessary) is what makes the chain’s recipe a one-of-a-kind success. CEO Mark Lardie has presided over this recipe for the past 10 years. Like all good cooks, he doesn’t mettle much and, equally important, lets his sous-chefs (management team) do what they do best. It a collaborative kitchen that’s firing on all cylinders of late, both in-store and online—a stateof-the-art omnichannel operation. Here, Chef/CEO Lardie breaks down the key ingredients to Rack Room Shoes’ recipe for success. It’s steeped in authenticity and genuineness—real ingredients for real people.

1

SERVE OUR CUSTOMERS: Rack Room Shoes’ mission statement is, “The company must serve the people.” That all starts by making sure customers have access to great footwear from leading brands at affordable prices. Whether they shop in-store, online or both, customers can be assured that their wants and needs will be met by a helpful and friendly staff. Shopping for shoes is a necessity, but that doesn’t mean it has to be a drudgery. “There’s always a need for feel-good moments in a family, and shopping for shoes can be a relatively affordable, feel-good moment,” says Lardie. “Rack Room Shoes is a place where customers enjoy shopping.”

embracing and supporting causes that are important to its people. “We are concerned about all our associates but especially the people who are thinking of us as a career,” Lardie says. “It’s important for us to communicate that, if you have the will and desire, this could be a forever job for you. You can live comfortably and support a family.” A happy employee also makes for a good one. “Our store managers and associates are what makes us successful,” Lardie says. “Creating a work environment where they can spend time with the customer and fulfill their needs is a key to our success.”

3 2 SERVE OUR ASSOCIATES: Employees matter. In the case of Rack Room Shoes, that’s thousands of people who work in 500-plus locations in 36 states. Offering a competitive wage and benefits; potential for advancement; and career opportunities are starting points. The company is also committed to making it a place where employees want to work, and that includes

SERVE OUR PARTNERS: A retailer is only as good as its selection. The key to ensuring that it remains topnotch starts with making sure brand partners are treated with respect and consistency so that they want to be merchandised on those shelves and sites. Presentation and pricing (namely maintaining it) are key. This is one part of the Rack Room Shoes recipe that is tweaked

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often—like the addition of the Athletic Shop, a shop-in-shop concept in-store and online that highlights active lifestyle brands. The destination shop feature’s a Who’s Who of leading brands, including Asics, Converse, Nike, Vans and Skechers. Online, the shop is merchandised by categories such as running, trail running, training and walking. “The Athletic Shop has allowed us to demonstrate that Rack Room Shoes is an athletic authority,” Lardie says. “Our omnichannel approach to the business has allowed us to take that connection and authority position with our customer in athletics and expand it. So, however the customer touches our brand and whenever they want to shop for or think about athletic shoes, we can direct them to our authority position.”

4

SERVE OUR COMMUNITIES: Rack Room Shoes’ mission statement that “the company must serve the people,” includes giving back to the communities where those customers reside as well as supporting the less fortunate nationwide. The company’s Rack Room Gives division is focused on supporting women, children and families in need through community fundraising to schools and civic organizations; donations in support of scholarships, military, disaster relief and Diversity Equity & Inclusion efforts; and an employee grant program that supports charities team members are passionate about. “Our philanthropic initiatives trace back to our parent company,

The Deichmann Group. Dr. HeinzHorst Deichmann created the nonprofit, Word and Deed, to provide aid to Christian organizations in the developing world in areas such as education, orphan care and disaster relief,” says Lardie. “It is a privilege to carry out his spirit of generosity today. We are constantly encouraged to find new ways to support the community in which we live and serve.” (To learn more about Rack Room Shoes’ commitment to philanthropy see “We Care a Lot” feature.)

marketing solutions. (See “Seamless Shopping” to learn more.) It also involves making sure Rack Room Shoes employees are as up to speed as the customers walking into its stores. “We need to make sure our associates have at least as much information as our customers,” Lardie says. “Customers today are aware of all the latest fashion trends happening around the world, and our employees need to be aware of those in real time.”

6 5 EMBRACE THE DATA: Information is gold. But it’s only of value if the reams of data now available can be interpreted in a timely matter and acted upon. This is one aspect of the Rack Room Shoes recipe that is constantly being updated—making sure the company is gathering, deciphering and capitalizing on all the data it is collecting. That effort includes partnering with Tinuiti, a company that specializes in connecting brands to their audiences with performance driven digital

A PINCH OF PERSEVERANCE: Retail is relentless. Every morning, all 500-plus Rack Room Shoes stores (includes 34 Off Broadway Shoe Warehouse locations) open their doors and must meet the demands of its customers; e.g. to “serve the people.” That requires talent, skill and determination—traits that Lardie says the Rack Room Shoes team possesses in droves, top to bottom. “We are only as good as our employees,” Lardie says. “Thankfully, we are blessed with the best.” •

Rack Room Shoes is a destination for the entire family.

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We Care a Lot

G

iving back is entwined in Rack Room Shoes’ DNA. Ever since founder Phil Levinson opened store number one in Salisbury, NC, 100 years ago, the family footwear chain—which now spans 500-plus communities in 36 states—has given back. In fact, giving back is part of Rack Room Shoes’ mission statement, which states: “The company must serve the people.” “It is our guiding principle,” says Brenda Christmon, senior director of brand communications and creator of the Rack Room Shoes Gives program. “Our company maintains a special commitment to those in need and has made it a fixture through our sustainability efforts, trade practices and social responsibility.” Rack Room Shoes Gives has become a division in and of itself—one that Christmon launched 10 years ago. “We made social responsibility a priority because our team members are passionate about our company’s purpose,” she says. “It’s part of our corporate culture and one of our distinguishing values that make team members proud to be a part of the Rack Room Shoes family.” The overriding mission of Rack Room Shoes Gives is to support women, children and families in need with three initiatives: 1. Community fundraising through gift

card donations to schools and civic organizations. 2. Corporate donations that offer community support in scholarships, military, disaster relief and Diversity Equity & Inclusion (DEI) efforts. 3. An employee grant program that supports charities team members are passionate about. Christmon reports that all have grown substantially over the past decade, especially corporate and local community donations. Highlights include Rack Room Shoes’ longstanding partnership with Shoes That Fit, the non-profit organization that provides new shoes to low-income children. During every back-to-school season, customers are encouraged to make donations to the charity at checkout. To date, the partnership has raised more than $11.6 million (includes a $300,000 company match each year) and provided more than 450,000 pairs of shoes to children in need. “Our partnership tackles one of the most visible signs of poverty in America by providing students in need with new shoes so they can attend school in dig-

nity and be prepared to play, learn and thrive,” Christmon says. “It’s one of our most heartwarming programs—our store managers and associates embrace the program and are the reason it is so successful. And seeing the smiles on children’s faces when they receive a new pair of shoes is priceless.” Another philanthropic highlight: Rack Room Shoes’ Teacher of the Year contest. Each year, customers can nominate teachers who have made a positive impact in their children’s lives. Five winners each receive a $10,000 grant for technology upgrades at their schools plus a $500 Rack Room Shoes gift card. “We love our teachers” Christmon says. “Through Teacher of the Year,

Rack Room Shoes employees pitch in at a Shoes That Fit event providing new shoes to Houston-area children in need and pack disaster relief Comfort Kits for the American Red Cross.

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we’ve been able to assist schools that are in dire need of new technology labs, upgraded laptops and helped to equip an entire able-challenge classroom with new modular desks. We see enhancing schools and supporting school programs and initiatives as an investment in young minds.” The Employee Match program is another philanthropic highlight gaining popularity. Any employee who wants to give to a charity that they are passionate about can donate up to $500, which is matched by Rack Room Shoes up to $500. Christmon says employees today want to work for companies that support causes they care deeply about. “Our internal diversity and inclusion survey revealed that many newly hired team members stated our social responsibility efforts were an important factor in choosing to work at Rack Room Shoes,” she says. “Dedicated employees want to feel engaged with the company’s purpose.” Another philanthropic initiative to benefit employees is the scholarship program introduced this year. Employees who have worked for at least one year can submit an essay through Scholarship America. Rack Room Shoes awarded five scholarships of $2,000,

‘‘

Social responsibility is part of our corporate culture and one of the distinguishing values that make team members proud to be a part of the Rack Room Shoes family.”

renewable for up to three years. Managing so many good deeds is a big job but a labor of love for Christmon. She has help—her “Team of Purpose” now includes a graphic designer, a social responsibility manager, a public relations manager, a DEI manager and an assistant project manager. She also has the full support of corporate to get all the good deeds done. “Rack Room Shoes is dedicated to making the world a better place for women, children and families by creating, developing and support-

-Brenda Christmon ing programs and non-profit organizations that provide them with a strong foundation for the future,” Christmon says. “Our efforts also ensure that our associates understand what our real purpose is, which is ‘the company must serve the people.’” •

Rack Room Shoes supports local communities via its Teacher of the Year contest, Shoes That Fit partnership and numerous employee volunteer events— like filling backpacks with donated school supplies for Charlotte, NC, kids in need with Classroom Central.

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Team Spirit Rack Room Shoes salutes its long-tenured employees.

RICHARD ARMIJO District Manager 25 years

BILL MULLINS Training Manager 33 years

WHIT MCCONNELL Vice President, Store Operations 35 years

KIMBERLY HILL Senior Logistics Analyst 32 years

KRISTINA SHIRLEY Sourcing Administrator – Logistics 34 years

ERIC SNIDER Logistics and Compliance Manager 35 years

KERI MORGAN Accounts Payable Manager 32 years

CHERI DANIELS Merchandise Administrator Manager 32 years

MARTINA CORPENING Purchasing Manager 35 years

BRENDA DIXON Sales Audit and Banking Manager 35 years

LISA SWEENEY Senior Merchandise Analyst 35 years

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RALPH WILKES IT Director Systems and Networking 35 years

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ENTHUSIASTIC passionate

reliable

T CLARK 42

ETTA MCNEILL 36

CARLA BRACKETT 29

THAI WINNINGHAM 26

DOUGLAS ELLER 39

ANGIE MOLLOHAN 32

ERNIE SHORE 29

DANIELA GARNER 26

MONIKA WILLIAMS 36

RYAN BASS 32

ALLEN GOSNELL 29

JONATHAN HERREN 26

SAUNDRA HOLLAND 36

ED LAUB 32

CALLIE HOLLSTEIN 28

LAURA MILLER 26

CAROL COSTNER 36

JON COBB 32

LISA CORPENING 28

DIANA PUGH 26

MARK MOWERY 36

JAIME MINOR 32

MARQUESSA COOK 28

CRISTI SHORE 26

RICK BROWN 36

TRACY HOOPER 31

ALYCE HAGAN 28

CHARLES MCGOWEN 26

STEPHEN JOHNSTON 36

PEGGY JACKSON 31

MALIA MITCHELL 28

DENA BOURASSA 26

DEBBIE BRYANT 36

BRIAN EBERWEIN 31

ANTONIO VILAR 28

RANDALL HODGE 26

LAMONTE HENDRICKS 35

GARY LEWIS 31

JOEL TALBERT 28

JESSE KING 26

LEONARD CARTER 35

MIKE TRACEY 31

KEN HELM 28

SHANNON WILKES 26

KATIE LEWIS 35

ADAM BUTCHER 31

ROBERT MAGGARD 28

ERIC SUAREZ 26

BOB CORCORAN 35

BRIAN SAFRIT 31

SANDRA PARR 27

CHERYL MONK 26

TONI FORT 35

EMMANUEL HAYFORD 30

KIMBERLY FARLEY 27

CATHERINE CONQUEST 26

SABRINA REID 35

GARY SMITH 30

JOHNNY FRETWELL 27

DARYA BROWN 25

ERIC STEPNOSKI 34

DARRELL FISHER 30

ROGER SHAFFER 27

LISA WEAR 25

TIMOTHY LOCKHART 33

DORIAN DODD 30

ALEXIS HOFFMAN 27

KEITH ROBINSON 25

MARVIN PLASTER 33

KATHY PRICE 30

EMORY PITTMAN 27

GREGORY BIDWELL 25

FREDERICK BERNSTEIN 33

MARY REVISH 29

KENNETH GLASS 27

ANGELA KEARNS 25

ADRIA RUEB 32

MIKE HARRISON 29

MARK SEAFORD 27

CHESTER SIERADZKI 25 Numbers denote years of service.

LOYAL Resourceful KEVIN STIMSON Director of Store Operations and Training 36 years

MIKE YOUNG Director of Merchandising 37 years

ROOSEVELT GRISSETT Store Manager 38 years

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Seamless Shopping

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few years ago, Rack Room Shoes decided to take its digital marketing outreach efforts and online shopping experience to next level status. It was a decision actually made before the pandemic and subsequent massive shift to online shopping. In addition to a head start, one of the other smart decisions Rack Room Shoes management made was to increase their pool of experts. Enter Tinuiti, a company that specializes in connecting brands to their audiences with performance driven digital marketing solutions. Tinuiti lives and breathes the digital space or, as the company says, knows how to “guide brands across the triopoly of Google, Amazon and Facebook.” Tinuiti specializes in multichannel strategies that connect brands with their customers at the “most critical moments in their digital journey.” That’s a techy way of saying Tinuiti knows how to get in front of Rack Room Shoes’ customers at the right times, with the right messages and with the right shoes. How does Tinuiti do that? Chelsey Codrington, Tinuiti’s senior director, client strategy for Rack Room Shoes, says it starts by anticipating needs based on data collection, messaging across multiple touchpoints and incorporating more personalization using a diversified media mix to push products the customer is interested in during key time periods, such as back-to-school. The effort

also involves engaging with future customers by combining internal connectivity of data and expertise to continue planning real time activities in the market; providing a seamless experience by analyzing how the shopper is behaving, what they are buying and who they are buying for; and, above all, creating an experience that adds value to a customer’s life while increasing the overall customer base and loyalty. Rack Room Shoes partnered with Tinuiti because both companies strongly believe in creating a seamless shopping experience with a customer first approach. To be sure, this partnership is not an online shopping conversion or bust effort. That’s because consumers don’t shop only one channel. For example, when Tinuiti promotes local inventory on Google, it often pushes revenue towards stores. These customers prefer to hop in their car and buy shoes that day. They may also have kids who need to be fitted properly by Rack Room Shoes experts. “Ecommerce helps the in-store experience and viceversa,” Codrington says. “They are not in competition.” That fact has more than verified during the pandemic. Shoppers’ desires for convenience has soared, combining digital and brick-and-mortar activities—like buying online and picking up in stores. “Shoppers got used to being at home and viewing items on mobile platforms,” Codrington explains. “And when stores re-

opened, people were looking to buy online and pick up in stores in a more convenient way. The pandemic forced us to rethink media and how consumers are using digital to shop in stores.” Oftentimes, communications are sent before consumers may have even begun shopping. For example, recently the team recognized an uptick in search trends for casual women’s shoes, which was discovered about four weeks in advance of competitors. Tinuiti/Rack Room Shoes pounced. “We adjusted media to that specific segmentation and were able to capitalize on that revenue,” Codrington explains. Another example is when, earlier this year, Crocs again gained momentum. Rack Room Shoes and Tinuiti increased communication to that customer. “When we recognized that trend, we capitalized on revenue opportunities by

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increasing the mass media spend to get in front of the audience,” Codrington says. “Increasing investments in specific brands or product segments optimizes real time performance.” Tinuiti’s tools are also very intuitive. “Sometimes before we even know what a customer likes, we can guide them into thinking what they might like by highlighting items based on trends we’re seeing,” Codrington says. “Letting customers know they then can find those items at Rack Room

‘‘

nership. “The Rack Room Shoes team is results-driven, dynamic, open to new media growth and helps Tinuiti by prioritizing data integration and market research,” Codrington says. “They allow us to diversify their media mix, personalizing media in terms of audience segmentation and setting them up for success going forward.” She adds that it all starts at the top with Rack Room Shoes CEO Mark Lardie. “A sign of a successful CEO is one who hires people who know what

The Rack Room Shoes team is resultsdriven, dynamic, open to new media growth and helps Tinuiti by prioritizing data integration and market research.” -Chelsey Codrington Shoes is an effective way of enticement.” This approach also applies to specific customer groups, like teachers. “If they’re getting ready to go back to school, there’s an increased interest in those work-appropriate shoes,” she says. “We then increase visibility of these products across online platforms to let those customers know they are available at Rack Room Shoes.” Success is made possible thanks to the great teamwork between Rack Room Shoes and Tinuiti. Each brings expertise and experience that blends seamlessly into this successful part-

Tinuiti data market research enables Rack Room Shoes to merchandise inventories in advance of key trends.

they’re doing and then lets them do it. Mark’s leadership makes us all look better.” Codrington believes the future of the Rack Room Shoes-Tinuiti partnership is bright. While the digital space is ever-evolving, she believes that with Rack Room Shoes’ retail acumen and Tinuiti’s digital expertise, the partnership will continue to flourish—so long as both entities keep their eyes on the ultimate prize: meeting the needs of shoppers. “We have to meet customers wherever they are and influence where they are going to go, and that message must be personalized,” Codrington says. “The keys to success are anticipating trends and audience behavior.” •

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