When news broke recently that HBC was splitting Saks Fifth Avenue into two, spinning off its ecommerce business from its brick-and-mortar stores, speculation swirled about the thinking behind the move. That news was followed shortly by an announcement that it was doing the same for its off-price Saks Off 5th company, separating the stores from its digital platform. The Joys of Going Private Since going private in 2019, HBC CEO Richard Baker doesn’t have to answer to the Street. He has a free pass to assert that the Saks move is “redefining …
What It Takes to Be Successful in Retail – Any Retail
As the world begins to open up from the pandemic shutdowns, malls across the country are feeling the love. In March, mall visits jumped 44 percent ahead of February, according to Placer.ai, based upon visit data tracked across 50+ malls in the U.S. in both urban and suburban centers. While April visits held just about level with March, they advanced another 14 percent in May. Throughout the first five months of 2021, the mall traffic remains under 2019 levels, but the gap has continued to shrink. Déjà Vu Over the next months, we can expect …
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Mobile Shopping Is on The Move: Retailers Need to Move with It
After months of pandemic-induced retail shutdowns, it comes as no shock that consumers turned online to do their shopping. Non-store retail sales grew 22 percent to end the year just under $1 trillion ($968 billion). In a nearly $4 trillion retail market, excluding autos, gasoline and food service, that means roughly one-out-of-four retail dollars happened outside brick-and-mortar stores’ four walls, including $883 billion conducted through electronic shopping and direct mail. The Digital Retail Highway What may have gone unnoticed is how …
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A Linear Path to Purchase Is an Illusion
We’ve all been told a consumer’s path to purchase proceeds in a straight line: awareness, familiarity, consideration, purchase … and if done right, it leads to loyalty. It’s a logical step-by-step progression model and gives brands the confidence to manage customers’ engagement and activate them along each step in their journey. Illusion Unveiled The problem is that this linear model is an illusion. Human beings simply don’t work this way -- ever. Instead, a consumer’s path to purchase takes a circuitous route, moving forward, going sideways, …
The WOW! Customer Experience
How can pandemic-crushed specialty retailers that were too slow or ineffective ramping up their e-commerce capabilities come back from the brink? Don’t look to Amazon, the big-boxes or category killers for inspiration, advises Wharton Professor Thomas Robertson and director of its Jay H. Baker Retailing Center. Instead, set your sights on Ritz Carlton, Disney Parks and British Airways. “These are all people intensive businesses, and they manage to deliver excellent customer experiences consistently,” he says, referring to British …
RH Builds Out its Horizons
Remember when Restoration Hardware was the quirky DIY-fixer’s catalog for people restoring Victorian houses? It’s come a long way from its home-spun roots back in 1979 when Stephen Gordon founded it. Progressive CEO In his most recent shareholders letter, Gary Friedman, the company’s current chairman and CEO, updates RH’s progress since joining the company in 2011: “The first two decades saw us evolve from a nearly bankrupt business with a $20 million market cap and a box of Oxydol laundry detergent on the cover of its catalog, to the leading …
Welcome to the Era of Conscientious Luxury
The seemingly insulated luxury market has never experienced a year like 2020 when personal luxury goods sales dropped $78 billion from 2019 – a 23 percent decrease year-over-year – to a total $266 billion in 2020. With the pandemic threatening both consumers’ health and finances, the industry’s decline was more than double the 9 percent drop experienced over two years during the 2008-2009 recession, according to Bain & Company. It is not expected to recover to 2019 levels until the end of 2022 or early 2023. Luxury Through the Ages Bain …
NRF’s Confounding Holiday Growth Pronouncement
Early in the morning, just as soon as the Census Department released its Advanced Monthly Retail Trade Survey for December 2020, I took a cursory look. It told me what I needed to know. Retail was doing reasonably well by year’s end, but certainly not great. One sign of weakness: On a month-by-month basis, retail trended down, not up. Seasonally adjusted sales were down 0.7 percent from November, following a monthly drop of 1.4 percent in November. This compares to monthly increases of 2.9 percent in December last year and 3.7 percent for …