Williams-Sonoma Earnings Call Insights: Williams-Sonoma Brand and Guidance Outlook

Williams-Sonoma, Inc. (NYSE:WSM) recently reported its second quarter earnings and discussed the following topics in its earnings conference call.

Williams-Somona Brand

Daniel Hofkin – William Blair & Company: Had a question going back to Williams-Sonoma specifically brand. Do you feel like, was outdoor isolated to weather or was it the content of the product in your opinion. And I guess just interested in what you think the time minus for sort of getting the brand to where you wanted to be from merchandising and service standpoint? Then I just had a quick housekeeping follow-up.

Laura J. Alber – President and CEO: We saw strength, as I said, in the areas that we’re most differentiated. And so it’s the combination of both newness, and newness that is very different from what the competition offers and those areas were in-home Agrarian cookware. Outdoor, which was a key marketing message spans several categories both the tools, but also the rubs and sauces and combination of factors that made it softer than we would have liked and the reality is that we needed new flow of outdoor (indiscernible), so we told the same story throughout the entire summer season. And the outdoor business is really a cooking trend that’s around year round. So, we need to have more flows of it next year, and possibly also less of it as a marketing statement. There were other great trends that we saw the ice cream trend, for example, and some of the sweet foods and sweet stories were strong. As I said, as we move into Q3, we really are optimistic about our product line. We have, right now as you know, if you’ve been into our store, we have wine country story, which spans both food and – but also how you entertain and it’s really back to our heritage and Chuck’s Fine, and we’re seeing some nice response on that so far. As we go into the ever important holiday season, you will see us launch Halloween here in stores, we have some of it online now and we have a – I think a much stronger and broader assortment in Halloween, and then also in Thanksgiving and Christmas. The entertaining at home theme is one that we are very focused on and you’re going to see us introduce a lot of exciting things in the home bar. We know that custom cocktails are something that everyone really enjoys and we think we can help our customer draw those great parties through the holiday season. In the back half strong holiday execution is key. At the same time we’ve talked to you about testing new ideas. Our approach is to test and roll ideas versus making precipitous far reaching changes because the customer has told us through number of focus groups how much they love the brand. So, we are being very careful and thoughtful about changes we make. And we are going to keep you posted along the way as we see different things work or not work well. In summary, I’d say the Williams-Sonoma story is really a story of innovation and execution and we are making good progress against the initiatives that we outlined.

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