What a difference a couple of months makes? For Pier 1 Imports, brand loyalty appeared to be headed for a steep decline amid four consecutive quarters of declining sales, a CEO set to leave the company at year’s end, and contention from a key investor.
Fast forward two months and Pier 1 Imports has received an injection of good news during crunch time in the all-important holiday season: The company’s third-quarter results sent shares skyrocketing to their biggest price gain ever and prompted price target increases among analysts who believe the company is taking a better approach to its merchandising and promotions, while the company’s loyalty program played a key role in its resurgence.
Along with the Board of Directors’ appointment of Terry E. London, Chairman, to the position of Interim President and Chief Executive Officer (effective Jan. 1, 2017, in conjunction with the planned departure of Alex W. Smith, Pier 1 Imports’ current President and CEO on Dec. 31, 2016), the company has found more stability in distribution, inventory management, marketing, and promotions.
Pier 1’s third-quarter sales were slightly down, $475.9 million from $478.0 million for the same period in 2015, but Smith was very upbeat about the third-quarter performance which saw same-store sales rise 1.8 percent and e-commerce sales jump 28 percent, to $97.4 million, which represents about 20 percent of net sales.
What’s more, Pier 1’s loyalty program accounted for nearly 75 percent of total sales for the quarter, Smith noted. That figure dwarfs last year’s third-quarter number of 33 percent of total sales attributed to loyalty program members.
Company sales picked up significant steam during the second half of November.
“We are making progress on our strategies to deliver shareholder value through our merchandising, marketing, supply chain, and real estate initiatives,” Smith said. “Our seasonal assortments are resonating with customers and we’re seeing strength across nearly all our product categories. As always, we’re pleased with how our teams and associates are executing against our holiday plans. We have a great deal of confidence in our brand positioning and long-term financial outlook.”
Pier 1 Imports has always been known for inspirational merchandise, great value, and outstanding customer service, he added.
“Layering our omnichannel capabilities on top of that foundation makes Pier 1 Imports a formidable force in the home furnishings space,” Smith said. “Our teams are focused on continually enhancing our business model to ensure that we thrive in today’s era of retailing and well into the future.”