Ralph Lauren Expands Intelligent Inventory Pilot and Pushes DTC
Consumer goods company Ralph Lauren has strategically positioned itself at the forefront of direct-to-consumer (DTC) initiatives, building out its presence and testing technology that supports these efforts, including a new artificial intelligence-powered buying model.
The company has been experimenting with intelligent inventory technology, having launched an AI-powered pilot in its European and Asian stores this quarter that improves in-stock availability on sizing and best-selling products to drive incremental sales and improve conversion.
Ralph Lauren already reports early success, according to a recent call with investors, with CEO and president Patrice Louvet sharing plans to scale the effort across a wide range of categories and markets over time.
“As we drive towards best-in-class digital technology and analytics, we tested our sophisticated predictive buying model … with our initial rollout limited to select sweaters, knit tops, and caps,” said Louvet.
The company’s CFO Jane Nielsen shared that Ralph Lauren is “focused on what we can control … harnessing big data and AI and, of course, operating and balance sheet discipline.”
In earlier earning reports, Nielsen has referenced a commitment to continuing to invest in not only AI and machine learning for inventory optimization, forecasting, and consumer engagement, but also testing genAI for uses in copy editing, graphics, and computer programming.
Ralph Lauren Continues to Grow DTC
For the company, DTC remains an anchor, representing about two-thirds of all company sales, according to Louvet.
“We added 1.7 million new consumers to our DTC businesses, up high single digits compared to last year, driven by all regions,” she said.
While the company’s “consumer ecosystem” is made up of a combined store and online presence, digital continues to be an increasingly important area of investment. For example, the company launched its Ralph Lauren digital flagship site in Canada following the opening of its physical Toronto store in Q4 2023.
“The DTC channels are really where the world of Ralph Lauren comes to life most powerfully, where we engage most directly with the consumer and have the most ability to impact the consumer experience,” said Louvet. “And that's where we've invested most.”
