Unique wedding attendant gift

Business & High Tech Editors

SAN FRANCISCO--(BUSINESS WIRE)--May 3, 2000

Williams-Sonoma (NYSE: WSM) today announced across the board success for its eCommerce site, www.williams-sonoma.com, which launched November 1, 1999.

During its first six months online, the site outperformed expectations on a number of fronts, including overall sales, order fulfillment, conversion rates, and customer acquisition, garnering industry recognition and delivering outstanding customer satisfaction.

"We are extremely pleased with the performance of our eCommerce site over its first six months online," said Shelley Nandkeolyar, vice president of the eCommerce division at Williams-Sonoma, Inc. "We have been able to successfully leverage the strength of our existing brand, established retail and catalog arms, and strong customer relationships to create a new business channel that has consistently exceeded our projections and expectations."

Wedding and Gift Registries Up 87%

Following its successful Q4 e-Commerce site performance, Williams-Sonoma relaunched its wedding and gift registry on January 20, 2000, allowing couples to register directly online. The site was an immediate success, in its first three months recording an 87% increase in total registries for Williams-Sonoma company-wide.

This high registration volume ensures additional site traffic and sales over the coming months as couples begin directing their wedding guests to these registries. Williams-Sonoma offers the entire wedding registry process - registering, editing and purchasing - consistently across all three distribution channels: retail, catalog and Internet.

Company Proves Success of Unified Fulfillment Strategy

As predicted, Williams-Sonoma successfully fulfilled its eCommerce orders throughout the holiday season and over the last six months, with the same level of satisfaction customers have expected from its catalog business for years. Williams-Sonoma catalog and Internet sales are supported out of the same distribution center and back-end fulfillment system. The advantage of this strategy was demonstrated through the successful holiday fulfillment, as well as excellent management of inventory for the Williams-Sonoma brand throughout the busy holiday season.

Between Thanksgiving and Christmas, the site's average conversion rate was 8.0%, an impressive number that is significantly higher than the industry standard of 3-4%. The highest conversion rate to date for a single day was 12.0%, with an average of 5.9% during the first 6 months.

Broad New Customer Base Drawn to Site

The Web site provided Williams-Sonoma access to a remarkable range of customers over the fourth quarter of 1999:

-- 34% of Internet buyers were new to the Williams-Sonoma

customer database, demonstrating the brand's ability to use

the Internet channel to attract new customers. 7% of this new

customer group had purchased from other Williams-Sonoma brands

including Pottery Barn, Pottery Barn Kids, Chambers and Hold

Everything, but were first time Williams-Sonoma brand

customers through the Web site.

-- 66% had previously purchased products from the catalog and/or

retail stores, indicating the advantages of providing

additional convenience and selection to these loyal customers.

Of this group, 9% were people who had purchased

Williams-Sonoma products in the past, but not recently. The

Web site provides the company an opportunity to reconnect with

these customers, and offers them a convenient new way to

access Williams-Sonoma products.

-- 89% of on-site sales were derived from direct-to-site

customers, the remainder coming through partnerships with

Epicurious.com and WeddingChannel.com (formerly Della.com),

demonstrating the strength of the company's established brand.

Due to broad customer awareness established over the last 40

years, in addition to cross-channel marketing tactics,

Williams-Sonoma's online customer acquisition cost was less

than 15% of sales, a minute number by Internet industry

standards.

Site Draws Industry Praise

In March, Williams-Sonoma was named the "Best entry into the Internet by a brick-and-mortar company" by Internet World Magazine's annual Industry Awards for 1999. The judges noted, "The company's development of a gift registry, with its attendant many-to-many focus, demonstrates a real understanding of the Web opportunity."

In addition, the site was recognized by ZDNet as one of the "Top 10 Best Examples of e-Commerce" over the 1999 holiday season. Williams-Sonoma was also awarded the "Best Practice" award for Time to Market from Knowledge Management World Magazine.

"We made it a point when we designed the site to combine the convenience, speed and accessibility of online shopping with the unique product assortment, customer service and reputation people have grown to love about the Williams-Sonoma brand," added Nandkeolyar. "This strategy is clearly paying off."

About Williams-Sonoma, Inc.

Williams-Sonoma, Inc. is a national specialty retailer of high quality kitchenware and other products for the home. These products are marketed through more than 341 retail stores and five mail order catalogs representing five distinct merchandising strategies: Williams-Sonoma, Pottery Barn, Pottery Barn Bed + Bath, Pottery Barn Kids, Hold Everything and Chambers. The company is headquartered in San Francisco.