November 1, 2001, 12:00 AM

The sole of a new machine: Payless plans to web-enable Shoe Finder

Payless Shoe Source has been pleased with the results that its in-store Shoe Finder has produced. It plans to link the service to the web so customers can order out-of-stock items from Payless.com while in the store.

Internet Retailer

It may not help customers find ruby slippers, but Topeka, Kan.-based Payless Shoe Source’s Shoe Finder service is helping customers find the shoes they want and saving sales at the rate of three a day per store. And it’s not even web-enabled yet.

Payless completed installation of systems to make the Shoe Finder work in all its stores this summer. It began airing TV commercials in September touting the ability of store personnel to locate out-of-stock shoes. When a customer can’t find the shoes she’s seeking in the store, a sales associate can use the POS terminal to look up inventory that might have been delivered and still unpacked in the back room, is in transit to the store or in one of up to nine nearby stores. If the associate finds the shoes at another store, he can call the store and ask the store to hold them for pick up. The customer receives a $1 off coupon that she can use when she picks up the shoes.

Rollout of the service occurred over about a year. The service was converting three customers a day within a short time. “It’s exceeded our expectations drastically,” says Garry Kelly, senior vice president of logistics information systems and technology.

Customers who can’t find the shoes in the local stores can always go on the web or call an 800-number and order them. But that requires the customer to take that action once she’s home or back in her office. When the terminals in Payless stores get web browsers, the clerk will be able to order the shoe at the Payless.com for the customer and have the purchase delivered to the store for pick up or to the customer. Shoe Finder will be linked to the web within three months, Kelly says.

The company invested $12 million in the Shoe Finder system, including re-fitting all 4,900 stores with modern PCs, swapping out terminals that dated as far back as 1988, when Payless began equipping stores with PCs. Today, all have Dell Pentium machines with online communications ability. Payless updates inventory from every store every night, then downloads inventory data back to stores via a virtual private network. The terminals get a daily update of inventory for the store where the terminal resides as well as for up to nine nearby stores.

Kelly won’t disclose payback on the investment, other than to say it is within the company’s acceptable parameters. But he notes that the system is also a customer service benefit. “This is also a customer service imperative,” he says. “It’s not only about selling additional shoes, it’s about satisfying the customer.”

Furthermore, Shoe Finder makes store associates more productive. Before Shoe Finder, clerks who wanted to help a customer find a shoe at another store typically made three calls per customer. The calls would involve a hit-or-miss approach, with the clerk calling nearby stores randomly until he found the shoes-or determined that they weren’t available. “We reduced that number of calls very quickly,” Kelly says. He adds that training of sales associates to use Shoe Finder was not a problem.

The major marketing for Shoe Finder was completed by early October, Kelly says. But he notes that it achieved its goal: “The customers got what the system is about. And they knew that the competition doesn’t have it.”

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