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Oct 01, 2004

Retailer Profile: Williams-Sonoma: From Hardware Store to Kitchenware Icon

PrintRetailer Profile: Williams-Sonoma: From Hardware Store to Kitchenware Icon  

By Laura Everage
Upon entry, you're immersed in the sights, sounds, smells, and tastes of all that is great about the kitchen. It's a sensory experience that welcomes customers and entices them to buy. Williams-Sonoma has perfected the art of retailing -- offering customers great products, great service, and an inviting atmosphere in which to shop.

A Quick History
A trip to Paris in 1952 inspired Chuck Williams to change his career. Upon his return from Paris, the former contractor decided to purchase a hardware store in Sonoma, intending to transform it into a store that offered French cookware. Within two years, he had replaced the shovels and electrical tape with copper pans and chef's knives. Shortly afterwards, Chuck moved the store from Sonoma to San Francisco where the location near Union Square proved to be an ideal place to expand his customer base.
In 1971, the first Williams-Sonoma catalog was launched and the following year, Williams-Sonoma, Inc. was established to oversee the growing company, which soon expanded to other upscale neighborhoods in California, such as Beverly Hills, Palo Alto, and Costa Mesa. In 1978, Howard Lester purchased the company, becoming president and CEO. Two years later, Williams-Sonoma Inc. expanded beyond the kitchen with the 1982 launch of Gardener's Eden (which was sold in 1999) and Hold Everything in 1983, the same year the company went public. The company continued to grow, adding Pottery Barn in 1986, and later Pottery Barn Kids, Pottery Barn Bed and Bath, Chambers, and West Elm. Today, Williams-Sonoma Inc. is a multibillion-dollar retailer that offers products for every room in the home.

Product Differentiation
The search for new product has never been easy, yet the challenges of sourcing them today are far different than they were in the early days when Williams used to travel to France for two to three weeks every year hunting for new items in the stores of France.
"It wasn't easy," said Williams, "because as I ventured into stores to look for product, many didn't have their names on them. I had to do a lot of investigating to find the manufacturer."
For the first ten years, products sold in Williams-Sonoma were more or less French, with most of the inventory being heavy professional French copper pots and pans, souffle dishes, au gratin dishes, omelet pans, sauté pans, etc. -- items that were not very familiar to most American cooks.
Gradually, Williams began to bring in other items from Europe like Italian pasta machines and German bakeware items.
"I decided to bring in kugelhopf pans, tart pans, springform pans, and other baking equipment that Germany was famous for, but that Americans really didn't have access to," he said.
His search for high-quality items was the result of his dissatisfaction with the quality of many of the items available in the U.S. for home chefs.
"Customers couldn't buy a professional knife unless they knew about restaurant supply shops," explained Williams. "Ordinary shops sold ordinary pots and pans, along with a bunch of low-quality imported stainless steel knives."
Although Williams offered his customers a range of product from around the world, he was also the first to make Calphalon professional cookware available to the home cook, and continues to be on the forefront of introducing American cooks to products they hadn't previously been exposed to. This also extended to many specialty foods.
During those early ventures to France, Williams took the opportunity to find food items not sold in the U.S., including extra-virgin olive oils from France, Dijon mustard, and jams and preserves that were made differently than here in the U.S. He enjoyed introducing a product that was made by a small company in small quantities.
"However, today it isn't as easy to find new items to carry," said Williams. "Whereas in the first 20–25 years, there was so much out there that hadn't been discovered by the American home chef. Today, that is no longer true and it remains a big challenge."
Besides introducing an item that is totally new to the market, Williams sees growth in developing something that improves on a product that may have been in the market for 70 or 80 years.
"What is helpful when working with a manufacturer on developing an improvement is that we have so many stores and our mail order business. Unfortunately, it also reduces the opportunity to work with suppliers who are unable to supply the quantity of merchandise that a company of our size requires. When we do find something that is done by a small manufacturer, it is a challenge to work with them to ensure that they can supply our needs."
When asked about the biggest surprise product that he brought into the stores, Williams notes the chicken water jug. While drinking whiskey and water with an American friend at the Hotel Hassler in Rome about 20 years ago, the water was served in a water jug in the shape of a chicken. He found the mug to be amusing and eventually, located the manufacturer and brought it in. The item has been available ever since.
"I've always been attracted to items that have an interesting story to them," said Williams. "Another example is White Cat popcorn, which we have sold for many years." As William tells it, "The cat that appeared on the tin was the family cat on the farm where the corn was grown. The white cat would sit on the front porch sunning itself watching the workmen on the farm brining in the corn. So they named the popcorn White Cat Popcorn."
Williams agrees that it does require a certain amount of newness to keep the business interesting.
"It takes understanding how a product is made, its purpose, and how it performs. It is extremely important that our employees know that because more often than not, these are the questions the customers will ask. It is up to our employees not only to welcome the customer, but to have the ability to tell the story of a product, to make it more interesting, and to provide more information than just the appearance."

Employees are the Key
While often referred to as "A Cook's Paradise," Williams-Sonoma stores work hard to be a safe haven even for those who are uninitiated in the kitchen. The key to making it a 'safe haven' for the more timid in the kitchen is the level of service the employees provide. Whether the customer is seeking a potato peeler or a highly specialized pan for a specific purpose, employees are always on hand to provide advice and direction.
During the 20 years that Williams operated one store, finding good employees wasn't as hard as it became when they started growing and adding locations.
"As we started adding stores, it became a challenge to get the right people who understood the business," said Williams, who noted that it wasn't necessarily a challenge to find people, as much as finding people who had the capacity for giving great service.
"The ability to give good service has to come from the person," he explained. "It isn't something that can be determined from a piece of paper, or in an interview when a person says, 'I can do this and I can do that.'"
In addition to finding employees who could provide good service, "we were also challenged to find people who were interested in cooking. We have been fortunate to find employees interested in cooking, interested in good products, and interested in how things are made so they can present a product with its story," he concluded.

The Magic of Merchandising
Great product that is explained by educated staff is made even more enticing through great merchandising. And that is what Williams-Sonoma captures so well in each store. The smell of bread baking often serves as a backdrop for all of the wonderful sights and sounds visitors can experience in the store. Aside from impeccably clean and organized shelves that make it easy to locate product, small themed vignettes set up throughout the store are designed to capture customers' attention. Barbecue accessories aren't simply stacked on a table or merchandised on the wall -- instead, a vignette transports the customer to an actual barbecue setting that may include a picnic table set with all the event's accoutrements located next to a beautiful grill. As the customer turns the corner, he may be welcomed by a table topped with the latest olive oil offering for tasting, along with bread for dipping, and perhaps a book on olive oils. With the press of a button on a demonstration machine in the coffee section, a fresh cup of great-tasting coffee is brewed up for the customer. Throughout the store, customers are encouraged to touch, experience, and inquire about the products on display -- a formula that not only educates the customers, but also entices them to purchase.

Expanding the Williams-Sonoma Brand
As the number of stores increased, so too did the Williams-Sonoma brand. To complement the expansion of the brand through additional stores, Williams looked for ways to make the brand available to a broader range of consumers. In 1972, he introduced the first catalogue, which quickly became a success. The catalogue continues to bring products into the homes of the consumers, and often serves as a way to drive people into the stores. It was in the catalogue where customers could purchase shallots.
"Most markets didn't have shallots available. Once we started selling them successfully in the catalogue, we sought out suppliers to work with so we could offer them year-round to our catalogue customers," explained Williams.
In fact, in some ways, the catalogue has helped shape the stores. Especially during the Christmas holiday season, the catalogue featured a multitude of perishable foods. Because these products sold so well, the decision was made to add perishable items to the stores. Today, a well-stocked Perishables Department may be found in a number of Williams-Sonoma stores.
Sharing knowledge with customers has been at the core of Williams-Sonoma's success since the start. Williams has always welcomed new ways to share that knowledge with customers and part of that movement was working with cookbooks.
"Most of our customers are interested in cooking," he said, "and they're always interested in cooking new things that they may experience in a restaurant." Williams' first cookbook, Williams-Sonoma Cookbook with a Guide to Kitchenware, which was published in 1986, was the first of more than 50 cookbooks he has either written or edited and includes the best-selling Williams-Sonoma Kitchen Library series. Throughout them all, he focused on good, simple, and easy-to-make foods.
The Internet has also made it possible to expand the company, without cutting into store sales.
"It is simply a matter of a different way of shopping," said Williams. "We have found it hasn't affected store sales greatly; instead, the Internet brings us more new business."
As Williams explained, the Internet is just another channel from which retailers can educate their customers.
"A Web site is a great way for customers looking for a specific item or purpose to find out more information about a variety of things. For these customers, it is almost like going to the store," he stated.

The Future
As for the future, Williams is confident.
"I think interest in cooking will not go away," he said. "We will certainly see a change in what people are cooking, and a lot of that will be determined by what they find in restaurants, what chefs and pastry chefs are doing, as well as the foods people experience while traveling."
His original store ushered in a renaissance in the kitchen for American consumers. And as consumer attitudes about food continue to shift, Williams-Sonoma is right there, readily offering products to meet their needs.

Number of Stores: 241 as of the end of first-quarter fiscal 2004
Owners:
W. Howard Lester - Chairman of the Board
Charles Williams - Founder and Director Emeritus
Web Site: www.williams-sonoma.com







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