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Headquartered in Dubai, GoodClothes is a highly successful department retailer offering completely Enter question
designed casual clothing and accessories. The company operates 10 stores in all seven emirates and 1
store in Al Ain. The company owns 6 stores and franchises 5. For some time, marketing managers targeted
population between the ages of 40 and 60 who like loose, comfortable clothes. Then, management was
tempted to stock its stores with clothes for a younger population as well. The disconnect between the new
items and the marketing strategy became clear. A new customer loyalty program failed. Sales gures fell. Continue to post
GoodClothes had lost touch with its best customer. The apparel retailer needed to reconnect with them.
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The 27-year-old retail chain had to take remedial steps.
Since the early 1990s, GoodClothes made some efforts to learn more about its customers and identify their
buying preferences. In the early 1990s, management launched the Passport Loyalty Program (PLP). Such
programs work similarly to airlines’ frequent yer programs. In stores, the principle is that the more you
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buy, the more discounts and gifts you get. PLP offered a 5% discount to customers who spend more than
AED 5000 annually. Still, this effort and the effort to obtain more useful information about customers were phone to post a question
ineffective. Besides pleasing members of the program, the PLP system had little effect on management’s We'll send you a one-time download
ability to receive business intelligence. To manage data, the company used DBMS. The in-house software link
developed over DBMS did not allow GoodClothes managers to drill into the company’s rich transaction
details. They could not learn how many or what kinds of items were sold to which customers at which of
the 11 stores. Not surprisingly, by the mid-1990s management decided simply to let the program die.
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In 2016, top management launched a major growth initiative, including plans to open new stores at the
rate of 5 stores each year. GoodClothes executives decided to revive PLP, but they knew that they could By providing your phone number, you agree to receive a one-tim
automated text message with a link to get the app. Standard
not execute the growth program without an effective way to analyze customer information. What good is messaging rates may apply.
a program such as PLP if management cannot get useful information from it? The executives knew they
had to nd more about the chain’s better customers to help with the growth. They decided to embark on a
Cross-Platform Business Function Tools (CPBFT). So GoodClothes launched a CRM (as part of CPBFT)
initiative and revitalized a failing frequent-shopper loyalty program to reconnect to its regulars, get useful
information from employees, and store it in a place for useful insights and reconnect with partners. Now,
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most merchandising, marketing, and promotional efforts aredirected squarely at GoodClothes best
customers. The result has been fewer fashion errors in GoodClothes stores and more activity at the cash
register. "We weren’t talking directly to [our core customer] anymore, and by not doing that, we lost focus,"
said Ahmad, director of direct marketing for GoodClothes, in Ajman. "Had we had the CPBFT at the time,
we never would have strayed."
A growing number of retailers and companies across many industry segments are using CPBFT technology
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to not only get in touch—or GoodClothes case, back in touch—with their best customers but also to drive
increased sales. Through initiatives such as loyalty clubs—which reward customers meeting certain 3rd Edition 4th Edition 3rd Edition
purchasing criteria with discounts, special gift offers, or personalized one-on-one service—experts say
companies such as GoodClothes are trying to boost the buying frequencies of their best customers. In View all solutions
GoodClothes case, the strategy appears to be working. Since it went live 16 months ago with only CRM
package (as a part of CPBFT), the company has increased the number of customers eligible for its PLP from
30,000 to 260,000, and that group now accounts for more than 58 percent of GoodClothes total sales, up
from around 8 percent in the 1990s. And all this volume has pumped up GoodClothes nancial
performance: Revenues soared 45 percent to $155 million in scal 2016, then climbed 65 percent to $186
million in the rst nine months of scal 2017. Using CRM and RDBMS (as the customer data warehouse),
GoodClothes can segment its customer base to nd its best clients; identify buying trends among them to
create cross-selling opportunities; and launch direct marketing campaigns, some via e-mail.
GoodClothes started its customer database with the 30,000 members of the original Passport program.
Since August 2017, the retailer has tripled the size of the data warehouse to 1.7 million customers, including
those in the expanded PLP. GoodClothes has begun collecting customer information from multiple
channels, not just in-store sales. Last May, GoodClothes began selling products online at
www.GoodClothes.com. Transaction data from these new touchpoints is also fed into RDBMS, so
GoodClothes has a complete view of its best customers regardless of where they shop. Using that
customer warehouse, GoodClothes has run 10 targeted promotional campaigns designed to increase the
buying frequency of its best customers as well as incite customers close to PLP status and new prospects
to shop more. These clients and prospects are mailed glossy, 10-to-24-page catalogs that showcase
newGoodClothes fashions each month, along with coupons offering 50 percent off any item as long as
customers spend AED 350. But GoodClothes hasn’t been using the CRM and customer loyalty program
data just to improve marketing. The company also uses the systems to help determine where to locate
new stores and which merchandise to stock in which locations based on purchasing patterns in each
emirate.
Bottom line, Ahmad said, GoodClothes merchandise and marketing are now a better t for the company’s
best customers. "Our numbers show that we're talking to the right customer at the right time. And the fact
that we know a little more about her has helped us across all departments," he said. But other problems
are gearing at GoodClothes. The companies that supply clothes to GoodClothes are increasing costs. This
pressurizes GoodClothes to also increase the cost. If this happens, GoodClothes consumers might shift to
other brands. GoodClothes need to de ne the strategy for “switching costs”. GoodClothes are also worried
about threats from other similar products available. “We do not want to fall in the same trap again”, said
Maryam, merchandise manager at GoodClothes. Another worry for GoodClothes is increasing costs from
the supply chain. The order received at GoodClothes is not matching with the order delivered. Upon
enquiring, “We found that the suppliers are not receiving the correct order”, said Sana, SCM Manager at
GoodClothes. “The orders we deliver are what we get from the companies, we are not at fault”, complains
Harry, Manager at ABC cargo. ABC cargo was recently added into GoodClothes to pick up material from
the Jebel Ali GoodClothes warehouse. Khalid, the Manager at GoodClothes warehouse is worried as the
order he receives also does not match with either the GoodClothes order list and the ABC cargo list. “I am
worried too and need to look into the matter. After all, it’s me who is blamed for no reason”.
“We are giving suggestions for improvement, management listens, notes our points, but nothing happens”,
says an agitated anonymous employee at GoodClothes. “It’s we who talk to consumers, getting feedbacks,
feed into the system, and expecting a response. We are not getting any response, are we at fault?”, claims
Zeena, a salesperson at one of the stores at GoodClothes. Hearing to this news, GoodClothes just unveiled
news that under its new chief executive officer, Shelley, the company has been implementing
newinitiatives set up for success. Due to a letter from the company to its shareholders that surfaced, the
company has moved forward and shown progress in these plans. The letter shows that Shelley has been
able to implement a new strategy that will drive the company’s growth and pro ts. Under her leadership,
the company has launched a comprehensive review of its operations. Additionally, Shelley highlighted
operating improvement opportunities and focus areas for GoodClothes. These focus areas include more
consistent growth, accelerating margins, and fortifying relationships with both new and existing customers.
The company also has realigned its marketing and digital commerce functions. A direct result of this action
shows approximately 14 million dollars of expected annualized cost savings. These are all actions from
Shelley’s focus on nancial, operating, and strategic plans. Also, the company recently announced four
additional initiatives in May and making changes to the Board of Directors. These initiatives include
improving GoodClothes supply chain, non-merchandise procurement, and marketing. Ultimately, the goal
of these initiatives is to save the company money. The estimated amount of annual cost savings from these
three areas is estimated at 50-70 million dollars. Aside from the initiatives, the company also stated that
board member changes are essential to the brand’s growth. GoodClothes hired Bonnie Brooks and William
Simon to their Board of Directors because of their relevant skillsets for the job. Allowing for these changes
proves GoodClothes is moving forward with its new business plan. Finally, Shelley wants to focus on IT and
its implementation at strategic decision making, “We need KM, DSS and ES to be implemented, and that
too quickly”, said Shelley smilingly.
GoodClothes also plans to be an Omni-channel specialty retailer of sophisticated clothing with casual-to-
dressy clothing, accessories, and intimates. Expanding and growing the company only means more growth
and exposure for these three house brands as well. The company also plans to expand its e-commerce site
that also sells its clothing. Although the company is still in motion with its new strategy, only time will tell if
its efforts are successful.
Questions Section 1 CLO 1- 5 Marks
1. GoodClothes had collected customer data for a long time. Discuss how the data can be used to de ne
the functional strategies using Strategic Information System (SIS) tools? (2 Marks)
2. GoodClothes are facing from the supplier side. Discuss that GoodClothes need to upgrade the Supply
Chain to reduce the “Bullwhip effect”? (3 Marks)
3. Analyze the use of Information System Knowledge Framework to integrate Information Technology with
the Information Systems at Good Clothes. (5 Marks)
4. Examine how Decision Support System, Expert System, and Knowledge Management will bene t Shelly
and GoodClothes in decision making? (5 Marks)
5. Evaluate the Web Enabled Security plan for Good Clothes using the Risks and Control Framework
method? (5 Marks)

Expert Answer

Divya Diwedi answered this

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463 answers

Answer 1. Data derived from Strategic information system tools help to design the corporate-level strategy
for GoodClothes.

This data helped to determine the trend in purchase and buying behaviour of the customers.
It helped to determine that where should GoodClothes open its new stores and which kind of clothes
should be stocked in which store by evaluating the trend of clothes choice of customers.
This data helped to identify its best customers to target its marketing efforts towards those customers.
This data helped to design marketing strategies to get its best customers to purchase more number of
products and to attract new customers.
This data helped to determine which customers quali ed for its loyalty program base on frequency and
amount they spend in shopping from GoodClothes.

Answer 2. Bullwhip effect means inventory uctuations due to insufficient asset allocation.

Due to the increase in the number of orders GoodClothes was not able to manage its orders and there was
a mismatch in the order placed and the order received from the supplier.
To reduce the bullwhip effect, GoodClothes need to monitor its supply chain operations more diligently.
It needs to track its order status through an online order tracking system.
The order should be placed with the supplier on a real-time basis based on demand to avoid keeping
unnecessary stock of inventory.

Answer 3. The use of Information System Knowledge Framework to integrate Information Technology with
the Information Systems at Good Clothes is:
 To integrate the operations of its various physical stores through a common IT enables application so that
the relevant data from each physical store could be viewed at one place.
Sales gures from both online and offline sale could be analysed together to assess which distribution
channel is producing maximum results.
By integrating all the distribution channels, GoodClothes can keep track of its inventory level on the store-
wise basis and individual stores can place an order for inventory replenishment on the centralized system
which could be monitored by the management.
Integrated operation system will help to speed up the operations at GoodClothes.

Answer 4. The decision support system, expert system knowledge management system will help
management at GoodClothes to analyse the performance of its brand.

These systems will help to sort and arrange data received from physical stores as well as an online portal
to derive meaningful information from them which will help to take important strategic decisions.
These systems will help to store a large amount of data for analysis at future date.
These systems will help to analyse the purchasing trends of customers so that GoodClothes can align its
marketing efforts accordingly to generate maximum revenue.
These systems will help management to analyse the results of the decisions made by them.

Answer 5. Risk and control framework method is used to identify potential risks and threats in an
organization and to nd ways to deal with them to either mitigate their effects or reduce their adverse
effect.

GoodClothes used web-based risk control framework method to identify which of its stores are performing
better and what needs to be altered in them to enhance their revenue.
It helped them to evaluate which strategies of theirs generated good results and which failed to produce
desired results.
It also helped them to evaluate that stores at which location are generating maximum revenue to decide
on the location of more stores based on similar responsible factors.
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