Stores need to develop a seamless, omnichannel approach if they want to challenge the dominant position brands have taken in the apparel market. That was the message President of Saks Fifth Avenue Marc Metrick delivered at Cowen and Company’s Men-at-Work Summit in New York City on Tuesday. Metrick mapped out how the retailer is currently planning for the future.
Saks is facing the issue of luxury brands being both their key partners and their key competitors. Metrick gave the example of his wife as the signature Saks customer and how she has shifted her allegiances: “Somebody would come up to her and say, ‘That’s a beautiful dress.’ In 1940, she would have said, ‘Thank you I bought it at Saks.’ In 2015, she would say, ‘Thank you, it’s St. Laurent.’”
Luxury department stores need to stand for something and they need to be differentiated and unique, Metrick said. He noted that the biggest success the store ever had was when they tripled the size of their women’s shoe business to about 100,000 pairs and moved it to the eighth floor in their flagship in Manhattan, better known as 10022-SHOE.
Saks is in the process of putting their 600,000 square-foot flagship through a $250 million renovation. The renovation entails moving its beauty business to the second floor and putting a category-dominant handbag assortment on the main floor. This is unusual for a department store, but Metrick highlighted, “To be the hero, you have to be your own brand.”
With their renovation, Saks is aiming to drive circulation through the entire building by decreasing sight lines, opening up vertical transportation and re-layering the store. They are enhancing the store’s status as a destination by bringing L’Avenue, the famed Parisian eatery, to the US for the first time.
A key aspect to the continuing success of brick-and-mortar is the millennial market, which Metrick said does show interest. To adapt to this demographic’s changing needs, and to future-proof the store, Saks is placing a special emphasis on their tech infrastructure.
In the future, Metrick envisions new achievements for omnichannel service: if a customer with the Saks app enters the store, geo-notifications will alert the sales staff. The customer’s associate will be able to see that last night he was searching online for men’s size 11 lace-up shoes, and the customer will receive a notification that his associate upstairs is ready to show him a variety of shoes.
Saks and other luxury department stores will have to smoothly incorporate technology to succeed. “This is the first time the customer’s ever beat us to the punch,” Metrick said. “Now the customer’s waiting for us at the end of this all-channel finish line, tapping their foot and saying, ‘When are you getting here?’”