What: Looking at department stores’ agreements with DNVBs from the other side.

Why it is important: There are many good reasons for such innovative brands to enter in department stores, including, and this could be surprising, the possibility to increase their digital sales.

An increasingly number of department stores are striking deals with digitally native brands, in the hope to attract younger customers. This, in turns, allows these brands to build a physical retail and real estate strategy.

Shop in shops are easier than standalone stores (including the associated long-term leases and costs) and help DNVBs to test markets before making decisions on going on their own. It is also a way to cover a market when its size might not justify a full retail presence.

It is also, paradoxically, a way to boost online sales: in 2019, Information Systems Research showed that the opening of a store helped DNVBs to increase their sales by +23 to +33%.

What The Newest Department Store Partnerships Mean For Physical Retail Strategies