Yes, when the wrong Saks comes to town, Saks dilutes its brand.
FROM RETAILWIRE:
Some retailers at the Bridgeport Village fashion lifestyle center in Portland, Oregon, were happy to hear about a Saks coming to their complex but were caught off guard when they realized it was actually the luxury retailer's Off 5th discount concept.
The 28,000-square foot location, opening in September, will be the chain's 12th "in a new 'luxury in a loft' design that aims for a modern and -- without aisles -- open feel," according to an article in The Oregonian.
Fred Bruning, chief executive of CenterCal Properties, which owns Bridgeport, told the paper that the concept looks like a mini department store. Jewelry departments are similar to Saks' full-price locations; with one Off 5th store he toured selling a $20,000 piece.
"We feel this will really fill a retail gap that exists here in Oregon," said Mr. Bruning.
About 20 percent of the Off 5th merchandise is from full-price stores, another 20 percent is private label, and the remainder is especially made for the store.
"We work with brands that you would find in other luxury retailers, whether Saks or Nordstrom or Neiman Marcus. We just work with them to create a value product," Robert Wallstrom, president of Off 5th, told the Oregonian.
The 500,000 square foot open-air center is located in one of the Portland metropolitan area's most affluent areas. Tenants include the Apple Store, Container Store, Crate & Barrel, Tommy Bahama, BCBGMAXAZRIA, J. Crew, Banana Republic, MAC Cosmetics and Ann Taylor Loft. It also includes restaurants such as California Pizza Kitchen and P.F. Chang's as well as the largest Regal Cinema in the state. The move comes as Saks just announced plans to close its full-price store in downtown Portland.
MY COMMENTARY:
I think it is an exciting prospect for the luxury department stores to be developing brand extensions. If that is, in fact, what they are doing.
It is not.
Unfortunately what's really happening here is forcing old formats into new places. AND on the heels of announcing the close of their “full-price” store. This is considered strategic?
Consumers today know and understand the game. They realize that a small percentage--in this case 20%--of product is actually "off price." Will consumers accept and buy from these stores in lifestyle centers? Probably. They will be driven by price, not brand experience.
Easton in Columbus, Ohio was mentioned above. My gut tells me the we won't see an "off price" brand there. The managers of Easton are much better editors than that. (Puma, Lacoste, Burberry are the latest additions.)
My advice is to look at proper brand extensions such as Barney's Co-Op. While not an "off-pricer," it gives Barney's new and different relevancy in different centers, appealing to different customers. Consumers get the halo effect of the master brand, but it's accessible in their neighborhoods, more on their terms.
Saks et al should be re-inventing these operations for the new normal and to complement and enhance their core brands.
Check out Off 5th here: http://bit.ly/9xKifr
Read the original post here: http://bit.ly/cAiCk7
No comments:
Post a Comment