To better compete against discount stores and online retailers, Saks is “making some radical changes” to its flagship department store on Fifth Avenue in New York City. Among them: an impressive new spiral staircase, glass elevator, an exclusive “vault” area for high-end jewelry and a new café and champagne bar.
According to a recent story in The New York Times, the $250 million, three-year renovation is part of a larger effort to make the in-store shopping experience more glamorous and unique at Saks, which in recent years has undergone something of an identity crisis, as it slashed prices to compete with competitors.
“Marilyn Monroe purchased dresses at Saks Fifth Avenue, and Elvis Presley his slick leather jacket,” the story notes. “But in more recent times, Saks has been adrift under the ownership… A patchy nationwide expansion saddled Saks with unprofitable mall locations. Heavy markdowns during the 2008 financial crisis tarnished its exclusive image.”
Among the glammed-up changes customers will see in-store, once the renovation is complete:
- A 23-foot-high spiral staircase, wrapped around a glass elevator.
- The beauty department will move to the second floor, leaving the first floor to handbags and other accessories.
- About 55,000 square feet of back-room space in the basement will be transformed into a boutique for fine jewelry to be called the Vault.
- To replace the faltering Cafe SFA, Saks is installing the Paris restaurant L’Avenue. It is also installing a champagne bar and a John Barrett beauty salon.
Saks isn’t the only big name national retailer trying to lure customers to stay in-store and shop longer with food. This week, Urban Outfitters announced it is buying The Vetri Family group of restaurants, which includes Pizzeria Vetri. The company, which is also behind the stores Anthropologie and Free People, already has experimented in the past with in-store coffee shops.
Washington Post business writer Sarah Halzick said the deal makes sense: The casual dining market is increasing even as brands such as Urban Outfitters are fighting harder than ever for consumers’ dollars.
“Put simply, consumers right now are shelling out money for experiences such as dining out even as they’ve remained more tight-fisted about ponying up for apparel and accessories,” she wrote. “So you can see the calculus that Urban Outfitters is making here: It is betting that an experience-based retail concept might be a boon for an ailing business whose stock has tumbled some 36 percent this year.”
Floral Management 2015 Marketer of the Year Winners Vince and Carolyn Butera have put a lot of time into thinking about what they want their in-store experience to be like for customers — and what they don’t need (hint: lots of space and lots of merchandise) to make that happen. Read their story.