CORPORATE CLOSE-UP;PARISIAN DRESSES DOWN;DEPARTMENT STORE CHAIN GROWS INTO A MORE AFFORDABLE IMAGE

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The Parisian department store chain is throwing off its sophisticated, Southern belle image for new advertising and promotions that reveal its lighter, more affordable side.

The 36-store, Birmingham, Ala.-based chain is bending to the casual lifestyle of '90s consumers with light-hearted ads and commercials spotlighting moderately priced clothes "for the whole family."

It's an unprecedented marketing move for the fast-growing company, which has opened 10 new stores in Atlanta, Cincinnati and Detroit since 1993. The privately owned company has long been respected for its service, old-fashion hospitality and high-end merchandise.

But in-house research has shown that the average consumer believes Parisian's moderate line of merchandise comes with a hefty price tag. So the company's expansion-minded CEO, Donald Hess, sees the new ads, by Steiner/Bressler as a way to attract today's price-minded consumers.

"Our research has indicated that many customers-or people who should be customers of ours-say they like the merchandise, but they really don't think they could afford to shop at Parisian," says Mr. Hess. "No, [our prices are] not the lowest in town-there are deep, deep discounted stores in all markets-but nor are we the highest. And on comparable merchandise, we think we give extraordinary value day in and day out."

In 1988, Parisian nearly went broke after aggressively expanding its chain in the Southeast and Midwest. It survived, and despite a heavy debt stemming from the expansion, analysts believe the chain is viable today. Sales in 1994 reached $600 million, up 16.5% from the previous year, and Mr. Hess hopes to open two new stores a year through 2000, keeping them in the South and Midwest.

Parisian, which began as a ladies' specialty store in the 1920s, carries merchandise similar to that found in many department stores, such as Liz Claiborne suits for women and Tommy Hilfiger sweaters for men.

"They have the service of a Nordstrom but the price range of a Hudson's," says Fred Marx, owner of Fred Marx and Associates, a Farmington Hills, Mich.-based consultancy.

In February, Parisian began running ads in newspapers and TV spots promoting its line of casual, affordable clothing. The store is clearly being more promotional, as well. For example, in March, a "Kids Fest" event was kicked off, and one-day sales (often with refreshments, contests and music) are organized monthly. Taglines promoting its Father's Day event included "Tie One On" and "Suit Yourself."

We are "trying to hold onto our core base of customers, but, at the same time, we understand that the consumer has changed," said Michael Green, Parisian's VP-marketing. "It is much more of a casual life they are leading, and we are trying to fill that void-and get them to understand that we are affordable."

But in its attempt to broaden its customer base, Parisian is taking on new competition. The chain has always competed with top-end merchandisers like Saks Fifth Avenue and Nordstrom. But today's ads and promotions appeal to the crowds that flock to Dayton Hudson and J.C. Penney stores.

Lee Backus, an analyst at Buckingham Research in New York, is doubtful Parisian's image makeover will succeed. He said moderate value is not what drives the customer to department stores, and Parisian's affordability campaign is not the best strategy. "In this marketplace, I think the way to differentiate yourself is to try to get out of the fray of all those moderate department and specialty stores. It's certainly a smaller part of the marketplace, but I don't think it's as crowded these days."

Previously, Parisian, taking itself "quite seriously," organized only two primary sales a year, Mr. Green says.

"Where in the past we would have treated ourselves rather sophisticatedly, quite frankly, the Grand Opening catalog for our [Greenville, S.C.] store was called `Cheap Thrills,'*" said Mr. Green. "And the coupons inside happened to be called `Cheaper Thrills.'

"That's what I mean about not taking ourselves so seriously and allowing the consumer to be more comfortable with us."

Still, with customers who are estimated to have an average annual income of $40,000-$50,000, Mr. Backus insists that Parisian's best bet is to do what it has always done in the past and what stores like Federated Department Stores are doing now: emphasize high-end merchandise.

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CORPORATE CLOSE-UP

Headquarters: Birmingham, Ala.

Sales: $600 million in 1994, up 16.5% from 1993.

Leadership: Donald Hess, president, part owner and CEO; Warren Bailey, VP and Chief Operating Officer; Jim Adams, Senior VP-stores; Howard Finkelstein, Senior VP-merchandising; Steven Corenblum, VP-Chief Financial Officer.

Agency: Steiner/Bressler, Birmingham, Ala.

Ad spending: $6.6 million in 1994

Recent successes: The opening of 10 new stores since 1993-including one

in the Detroit area, its biggest market thus far-while controlling corporate overhead and maintaining its reputable service.

Challenges: Finding ways to differentiate itself in the highly

competitive department store industry and continuing to establish itself with the changing consumer. Finding the financing to continue growing the company and to eventually take it public.

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