Web-based orders at Lillian Vernon Corp. were up 70% in its fiscal first half, the company reported today. But it wasn’t enough to stem a decline in total sales. Lillian Vernon reported that first half sales were $72.9 million, down 4.7% from last year’s $76.5 million. Q2 sales were $36.1 million, down 2% from $36.8 million in the last year’s Q2.
Lillian Vernon is trying to boost web revenue even more with a new agreement with the MSN shopping portal. The company does not report a dollar figure for web sales.
The first half decline in revenue was the result of a reduction in catalog mailings by 10% to target the catalogs more carefully. As a result, average revenue per catalog increased 7.6%.
The company also reported that it is implementing a pay-for-performance program for distribution center employees to increase their efficiency. It is costing the company about $600,000. Managers won’t know results until after the peak holiday shopping season.
Net loss for the first half was $10.9 million compared to $7.3 million in last year’s first half. Net loss in the second quarter was $6.1 million, compared to $3.4 million for the second quarter of last fiscal year.
Moving into the holiday shopping season, Lillian Vernon will introduce a co-branded MasterCard in October. The card will recognize customer loyalty and the company expects it to increase sales by awarding points toward future purchases.
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