Case study: Tommy Hilfiger uses IT to weather recession

A recession-driven technology review has prompted fashion retailer Tommy Hilfiger to introduce new tools to increase efficiency and reduce costs.

A recession-driven technology review has prompted fashion retailer Tommy Hilfiger to introduce new tools to increase efficiency and reduce costs.

Despite managing to keep afloat during the downturn - its global sales increased by 3.5% in the six months to last September - Tommy Hilfiger pressed ahead with IT initiatives to mitigate the pressures of the overall economic environment.

Part of that process involved reassessing the firm's collaboration tools, including its videoconferencing set-up provided by Polycom. This was followed by the adoption of a telepresence suite provided by BT and Cisco to cut down on travel costs and carbon emissions while improving teamwork among designers.

In an interview with Computer Weekly, Tommy's chief information officer, Mike Day, said the technology was not cheap compared with traditional videoconferencing options, but the firm expected a return on investment within 12 months from a travel spend perspective.

Day said the new platform improved communication, with benefits including the elimination of latency in network delays and utilisation of high-definition video.

"Teleconferencing has brought a significant improvement to the experience of videoconferencing," he said. "We realised that more people other than the executive group could benefit from it by replicating face-to-face meetings and making them a lot more interactive."

Tommy's "virtual fitting rooms" include mobile cameras and recording facilities to enable the design team - based in Amsterdam and New York - to discuss work around its collection with the manufacturing team in Hong Kong.

The fashion house is rolling out the technology in phases and designers are going through an "acceptance and training" period. Day said feedback had been positive so far.

He said the recession had also sharpened the firm's focus on supply chain systems and processes to speed up the timescales between a product's design and its delivery to the shop floor to reduce working capital and risk.

Tommy Hilfiger is concentrating on its web operation, too, and making improvements to its ATG-supplied e-commerce platform, which is based on software-as-a-service technology.

Last year, the retailer introduced an iPhone mobile shopping application - also based on ATG's framework - which is more in-store for customer-facing applications.

"We are trying to get a single message of the brand to consumers through the web," said Day, adding that the firm wanted to manage customer relationships more proactively.

The $3bn acquisition of Tommy Hilfiger's parent, Sportswear Holdings, by Calvin Klein owner Phillips-Van Heusen has been formalised, creating one of the world's biggest clothing businesses.

Because Tommy operates its own supply chain, Day does not expect any major problems with integration after the acquisition, but he said there was possible scope for IT synergies between the firms.

Read more on IT strategy