Tommy Hilfiger E Commerce Overview Tommy.

com
Executive IT Advisor to Tommy Hilfiger Inc. August 8th, 2006

Eric Singleton

Tommy Hilfiger History

Founded in 1984, Tommy Hilfiger Corporation, through its subsidiaries, designs, sources and markets men's and women's sportswear, jeanswear and childrenswear under the Tommy Hilfiger trademarks. Through a range of strategic licensing agreements, the Company also offers a broad array of related apparel, accessories, footwear, fragrance and home furnishings. The Company's products can be found in leading department and specialty stores throughout the United States, Canada, Europe, Mexico, Central and South America, Japan, Hong Kong and other countries in the Far East, as well as the Company's own network of specialty and outlet stores in the United States, Canada and Europe.

Project Background

Directive from CEO in 2003 to create a direct to consumer channel on the web Company initally recommended outsourcing Moved to in-house for more direct control

Started with mini-sites to establish learning

During this development evident that antiquated back end systems could not support the new effort

Project Background

New CIO determined that an entirely new company wide ERP would be needed to serve as a base platform for a range of new strategic IT initiatives Needed to support a flexible, scalable, and secure e commerce site that could manage projected growth Microsoft Dynamics AX selected for infrastructure, management, analysis and reporting needs, etc.

Project Background Tommy Hilfigers E Commerce strategy is to:

Implement a world-class ERP solution as the foundation to swiftly develop the companys Web channel objectives across brands and markets Use Microsoft Business Solutions AXAPTA as the ERP tool for the back office integrating it to the company front end web site. Go live on AX no later than May 2005 from a start date of December 2004.

Project Background

Guarantee AX ERP as a solution to provide the company with a stable, scalable, manageable IT infrastructure that would support Web channel initiatives and objectives, with potential for further integration into other parts of the company over time. The immediate objective for the e-commerce team was to transform tommy.com from a branding site into a fully functioning online retail site

Project Objectives
Present to the consumer comprehensive view of the world of Tommy Hilfiger product Establish and grow the Web sales channel to develop both existing and new customers: Consumers (B2C) Specialty Stores (B2B) Employees (B2E) Reduce reliance on traditional channel partners to present and market to consumers the breadth of Tommy Hilfiger product.

E Commerce Project Objectives

Increase margins. By reducing its reliance on traditional department store partners for distribution, the company will both increase the control over presentation and realize far better margins. Grow U.S. e-commerce revenues to $XX million by the end of FY07. Pro-actively support evolving corporate initiatives.

Exploit revenue potential of 3rd party Web sites.

Tap other e-commerce sites for specific purposes, e.g. BlueFly for premium product liquidation, and the like. Global web channel development.

Dynamics AX Project Objectives Create a flexible infrastructure from which to build current and future Web initiatives. Adopt best practices already baked into off the shelf AX solution or integrate third party product with AX to manage the online commerce and marketing needs of the company over time, across the globe. Leverage AX/3rd party integrated Customer service, fulfillment, warehouse management systems, merchandising systems, Financial systems, controls and reporting capabilities.

Dynamics AX Project Objectives

Continuously improve business processes and create opportunities to grow the business Increase team morale with improved systems and processes to grow the business and meet revenue, product and service objectives To gain benefit by leveraging the nature of the AX software and thereby limit Tommy Hilfiger specific custom development.

Critical Success Factors for E Commerce and AX E Commerce To be Live by July, 2005 at the latest. To use as much of the standard AX functionality integrated with Commerce Server and the wider .Net suite of products as possible.
Only changes in critical processes will be accepted if it is impossible to find work-arounds in the standardized workflow.

Mid Term Results Classic push back at third month from IT and the business regarding process changes, new ERP, etc.

Difficulty interfacing with antiquated systems, zero documentation created hidden mine fields
Configuration of Commerce Server/BizTalk/AX debates

Integration concerns relating to phase two and three of Tommy.com with forthcoming third party web apps In a six month project, even one week of debate can derail the timeline irreparably

Six Month Launch Position Resistance to new ERP largely managed, but evident that further diplomacy would be needed going forward.

Through much effort and historic documenting of legacy systems, necessary interfaces created.
Configuration of Commerce Server/BizTalk/AX debates resolved but these are healthy Integration concerns relating to phase two and three of Tommy.com with third party web apps resolved as well. At the eleventh hour, literally, Tommy.com was ready to launch

Post Launch Results Entire Tommy Hilfiger Collection online Custom Fit section online Initial revenue projections being met and on target for 07 goals Teed up for Fall/Winter 06 season with new collections post-sale of company Cost ON TARGET for the entire project Expansion into state of the art merchandising, production and design systems well on their way.

Summary Initial direction from CEO to build Tommy.com in 2003 Delays and failures to integrate a new Tommy.Com to legacy systems drove aggressive decision by new CIO to start from scratch and Unbending timeline from CEO led to creative single global platform strategy Via quick establishment of process models, SEI Cmmi concepts, support from top management, understanding of homogeneous platform integration, and careful product selection, our approach was successful.