What: Coresight reviews the situation for department stores playing in the top tier market, named ‘luxury’ by the research company.

Why it is important: This report provides interesting numbers and a perspective, however is also flawed by a lack of understanding of some aspects of the business, which leads to some confusion in the diagnosis.

Coresight reviews the global situation of “luxury” department stores which are poised to continually reinvent themselves in order to remain relevant to demanding customers. The luxury department stores size is expected to grow +10.7% to $127.5 bn in 2022 and is mentioned in the report as the biggest offline luxury retail channel (61.2% of the total offline sales) which somehow questions the methodology and point of reference. Coresight includes in the Luxury Department Stores cohort the likes of Hyundai, Shinsegae, Takashimaya, Nordstrom, SKP, Golden Eagle, Sogo, Galeries Lafayette, Harrods and others, as shown in the exhibit below.

![CORESIGHT 

Coresight identifies 5 key trends for them:

• Reduce the dependence on wholesale distribution, through the development or redeployment of private labels or special partnerships with brands, as well as an increased proportion of concessions granted in stores.
• Increase resale initiatives as illustrated by the Re-store in Galeries, Lafayette, dress rental and fine watches exchange services at Harrods, Reflaunt partnership at Harvey Nichols or a second-hand service at Selfridges or Printemps.
• Achieve renewed relevance as experience centres. Coresight chose to illustrate this fact by mentioning la Samaritaine or the Playhouse at Selfridges, however we believe that SKP-S is the best illustration of this trend.
• Develop popups relationships with DTC brands, in order to bring a new customer in the store,
• Help luxury brands to reach suburban customer, with new store formats able to penetrate new markets and therefore increase the exposure of luxury brands to new communities.

Situation of "luxury" department stores in the world