Story By Ruth La Ferla of the New York Times
GRACE BELLO clutched her prize to her chest. “This Marc Jacobs dress is making my day — I need it,” she said. At that moment, Jim DePaolis, a sales associate, raced toward her with a Diane Von Furstenberg frock in one hand and a black cocktail dress in the other.
Ms. Bello held up the little black dress, assessing its charms, as Mr. DePaolis began courting her in earnest: “I’m seeing a little retro ’60s girl,” he said. Next, he produced a punkish satin gown that bristled with safety pins, urging Ms. Bello to “imagine this with a pair of motorcycle boots.”
A style-struck pair, Ms. Bello, a writer, and Mr. DePaolis, who has worked for Banana Republic, might have been haunting some Manhattan citadel of chic — Jeffrey in the meatpacking district or Barneys on Madison Avenue. In fact they were in Chelsea, spelunking for treasures at the Goodwill store on West 25th Street.
The 5,500-square-foot thrift outlet is a laboratory of sorts for Goodwill and its 2,200 stores around the country. Intent on sprucing up an image that conjures low-end castoffs and no-frills ambience, many Goodwill stores are courting the shoppers who scour high-end resale shops and department store sales racks for bargains.
“We are making a particularly strong push right now to improve our image, our reputation and our brand, to promote Goodwill as a cool place to shop,” said Jim Gibbons, the chief executive for Goodwill Industries International in Rockville, Md.
Many Goodwill stores have increased the size of their sales floors to display goods more generously, Mr. Gibbons said, rather than turning them out jumble-sale-style. Shoppers expecting a traditional thrift store might be surprised to enter one of Goodwill’s free-standing “boutiques” in cities including Milwaukee; Palm Beach, Fla.; and Portland, Ore., which offer daily deliveries of donated designer goods and department store labels in the manner of a fast-fashion chain like H & M.
Other special items are featured online in Goodwill auction and shopping sites, and some stores have even staged fashion shows.
“We have embraced a more traditional retail strategy,” said Mauricio Hernandez, a senior vice president for Goodwill of Greater of New York and Northern New Jersey.
With some success, it seems. In a tough economy, it is probably no surprise that Goodwill stores are thriving, as shopper at all levels trade down. Even middle-class consumers now “look for extreme values,” including at secondhand stores, said Jeff Van Sinderen, a retail analyst at B. Riley, a Los Angeles research and investment firm.
Sales at Goodwill stores open at least a year rose 7.1 percent in the first three months of 2009 over the same period a year earlier.
At least some of that growth can be attributed to its efforts to enhance its image and merchandising, which began several years ago and has been accelerating. Some shops have undergone face-lifts, from the lighting to the use of mannequins. Others have increased traffic through television and print advertising, shopping Web sites, social-media marketing and promotional events that appear to be attracting the kinds of trophy hunters who trawl for bargains at stores like Nordstrom or Wal-Mart.
“The fact that we’re seeing more of those people when there are other shopping options could at least in part be attributed to marketing,” said Brendan Hurley, vice president for marketing and communication at the Goodwill of Greater Washington.
FOUNDED by a Methodist minister in 1902, Goodwill operates as a loose confederation of 160 independent regional agencies in North America. Today it has no church affiliation. Each chapter follows guidelines set down by the parent group, and each is free to pursue marketing strategies tailored to its region.
Sales at the nine Washington-area stores, for example, increased this spring by 5 percent, partly as a result of the organization’s effort to recast itself as a source of vintage and high-end fashions for young professional women. Last year, the Washington chapter hired Em Hall, a Web marketing specialist, to blog about stylish merchandise in its stores. It also uploaded a video of its annual fashion show to fashionofgoodwill.com, its Web site. “We thought we could learn from Victoria’s Secret, which was doing virtual fashion shows online,” Mr. Hurley said.
Across the country, Goodwill is competing for shoppers with a keener eye and sometimes deeper pockets. A few stores are adjusting prices accordingly. The many who think of the brand as a graveyard for no-name castoffs would be surprised — or dismayed — to find a Prada bag marked at $200 and climbing at auction on a Goodwill Web site, or a Pucci shirt for $800.
This is not to say the group has abandoned its low-income customers. Clothing prices typically range from about $7 to $20. Selective price hikes, however, support the nonprofit’s core mission: Goodwill says that about 84 percent of its revenues go into job training for the disabled and other programs.
Mr. Hernandez said he is seeking “more brand-aware managers” equipped to recognize (and, to some degree, exploit) the market value of luxury labels. “In the past we have been a little taken aback to find out the original store value of a Chanel jacket that we might carry,” he said. “Now we set prices in a way that the market will determine,” at roughly 10 to 15 percent of the original cost.
Goodwill of Akron, Ohio, published an annual report formatted in the style of a fashion magazine. Retique, a free-standing Goodwill boutique in Milwaukee, sent a direct mailing to customers in the trendy Third Ward district. “They are shoppers with more disposable income,” explained Vicki Holschuh, a vice president at Goodwill of Southern Wisconsin. “They typically would not have been in our stores before.”
The Milwaukee boutique displays its most covetable wares on mannequins. “We’re seeing a lot of people stretching their dollar specifically for name brands and fashion forward items,” said Cheryl Lightholder, a spokeswoman for Goodwill of Southern Wisconsin. “We set up the boutique to highlight those.”
Although the Goodwill store on Third Avenue and East 122nd Street in Manhattan has yet to segregate designer brands like some of its sister shops (a Vera Wang gown was marked last week at $9.99), it highlights some in its windows. Repeat customers are also being notified of sales. “It’s a personalization of services similar to Saks,” said Mr. Hernandez of the New York-New Jersey Goodwill chapter.
In San Francisco, Goodwill shops are “marketing to recessionistas,” said James David, a spokesman. Before donations are shipped to different stores, they are photographed. “If something catches our eye — say an Armani button-down shirt — it’s going to head down to one of our better boutiques,” he said.
About a month ago, the organization began using Twitter to alert customers to offerings on seamsogood.com, which is recent weeks has promoted a Ralph Lauren tuxedo and Pucci-print pumps. “As retailers, we’re redoubling our efforts to re-introduce ourselves to shoppers,” Mr. David said. “It’s our moment to seize and we must.”
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