Consumers in charge
If there is a silver lining to the current recession and any signs of hope for a fashion retail environment that has been hammered by the Internet, it may be this: Shopping is about to get interesting again.
The homogenous, global brand-building of the last decade that has made the Gucci boutique in Beverly Hills identical to the one in Bangkok is starting to fade. Retailers are in the process of shifting from being brand and product-centric to being market and consumer-centric.
In other words, the shopper is in the driver’s seat.
Stores at every price point are having to work harder than ever to get people in the door, and, once they get them there, to pique their interest in what they’re selling. That means more curated assortments, surprising designer collaborations and mingling of high- and low-end.
“There is more of an effort to create a unique shopping experience,” said Claudia D’Arpizio, business consultant for the Boston-based management consulting firm Bain & Co. “One that is less intimidating and more entertaining, so that the consumer sees a store as a place to have a good time, not just as a status symbol.”
This fall, Bloomingdale’s is staging a campaign, “Lights, Camera, Fashion,” that will offer short films in stores, free movie tickets, cinematic window displays and tie-ins with movie studios.
High-end designers and stores are mixing it up. Gucci has planned a series of pop-up sneaker stores with designs by DJ Mark Ronson, Jil Sander’s first collection for Japanese fast-fashion giant Uniqlo lands Oct. 1 and Jimmy Choo designer Tamara Mellon’s shoes and clothing for H&M; arrive Nov. 14.
Stores are also presenting more information about products -- how they are made and why they cost what they do.
“Retailers have to help customers understand what luxury is,” said Marshal Cohen, chief industry analyst for market research firm NPD Group. “You can’t expect them to know why something costs $300. So we are going to see the ‘Brookstoning’ of retail -- displays with product explanations, signage, more colors to draw you into display. They have to find new ways for consumers to experience product.”
In its fall catalog, Saks Fifth Avenue uses explanatory text to emphasize the price-value equation. A $4,490 Oscar de la Renta cocktail dress “required 150 hours of work” and has a bodice that is “hand-embroidered using a sheeting method of overlapping sequins” and an ostrich feather skirt that is “hand-appliqued.” A $295 red DKNY dress of “ultra breathable cotton ponte fabric is lightweight and season-less.”
The strategy came out of customer research conducted in April. “One of the comments we got was, ‘I feel like I shopped like a pig for all those years,’ ” said Kimberly Grabel, senior vice president of marketing for Saks Fifth Avenue. “Now, there’s more of a thought process that goes into shopping.”
Saks and other high-end stores are offering more “entry level” merchandise, such as Miu Miu and Fendi shoes priced at less than $400. And a new “bridge” category is being defined by lines such as Tory Burch and Elizabeth and James, which make clothes “with a fashion bent, but a lower price point,” said retail consultant Robert Burke.
On the negative side, stores have leaner inventories and fewer salespeople; on the positive side, many are zeroing in more efficiently on the needs of specific markets.
“You can’t cookie-cutter the world,” Cohen said. “There’s a clear movement in understanding that retailers have to localize,” he added, pointing to a Target store in Jacksonville, Fla., that is just now starting to carry swimwear year-round.
Another example is Macy’s, which has started an initiative to tailor merchandise to individual stores. Tested in 20 markets in spring 2008, the My Macy’s initiative went nationwide in February after those pilot stores outperformed others in the chain. Responding to customer requests, juniors departments will be added to the Century City and Newport Beach stores in September. A petites department will be added to the Beverly Center Macy’s in spring 2010.
“We used to have a central organization directing merchandising down. Now we have people in the field directing merchandising needs up,” said John Gorham, senior vice president, director of stores for Macy’s Southwest.
Progress, sure. But the real revolution in retail will be mobile, experts say. Tag technology will allow shoppers to use a cellphone to upload a photo of a bar code on an item and get all sorts of information that a salesperson might never have. “It could take you to a specific URL, or promote a special message, or take you directly to a product information page,” says Sucharita Mulpuru, vice president and principal analyst for market research firm Forrester Research Inc. in Cambridge, Mass. “So far, it’s been about bringing the store to your home. But the future will be about bringing the Web to the store.”
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