News
Decathlon completes takeover of Bergfreunde
Decathlon completes takeover of Bergfreunde
What: Decathlon has officially acquired Bergfreunde, a Swabian outdoor specialist, as a wholly-owned subsidiary.
Why it is important: Decathlon has expanded its portfolio and influence within the sporting goods industry.
The acquisition was completed on January 2 after receiving regulatory approvals and meeting customary closing conditions. Bergfreunde will continue to operate independently from Decathlon's core business, maintaining its organizational and operational detachment. The management team, represented by Matthias Gebhard and Ronny Höhn, will remain unchanged following the acquisition. The purchase agreement was executed on November 24, 2023, and publicly disclosed on November 27, 2023.
No changes are anticipated in the management or operational structure of Bergfreunde as it becomes integrated with Decathlon.
Legislation is coming for fashion’s supply chain
Legislation is coming for fashion’s supply chain
What: As 2025 climate commitments approach, the fashion industry faces pressure to improve its supply chains amidst various challenges.
Why it is important: In 2024, the industry should focus on how suppliers and workers can drive conversations forward, moving away from brand-centric narratives to a collective approach that empowers communities and suppliers. The power dynamics are shifting, and the industry needs to listen to these voices for meaningful change.
Key trends for 2024 include greater industry collaboration, a deeper understanding of the need for primary data at the product level, and the adoption of digital product labeling. New legislation in the EU and the US, such as the Corporate Sustainability Reporting Directive and the Uyghur Forced Labour Protection Act, is expected to significantly impact the industry, with mandatory reporting requirements and increased enforcement budgets.
Despite these regulations, many major brands still resist disclosing basic information like production volumes, which is crucial for accurate projections about carbon reduction strategies. The pandemic has highlighted the unfair practices and power imbalances in global supply chains, prompting a need for more resilient and transparent supply chains with stronger partnerships.
The luxury sector is beginning to adjust to new realities, with some suppliers boycotting brands that don't respect their terms. Suppliers are also prioritizing brand partners that provide consistent orders and investment. Compliance requirements in 2024 will impact suppliers, with larger organizations likely dominating smaller ones unless they have a unique niche.
Technology adoption in supply chains is lagging, but the long-term benefits outweigh the costs. AI is enabling businesses to collect and analyze data more effectively. Investments in supplier compliance platforms are increasing visibility of risks and enabling proactive responses to regulatory concerns.
GKK continues to expect losses
GKK continues to expect losses
What: Galeria Karstadt Kaufhof (GKK) anticipates losses in the 2023/24 financial year, expecting results in the lower negative double-digit million range
Why it is important: The new year for GKK begins amidst the bankruptcy saga of the Signa Reich.
The company forecasts a positive operating income in the mid double-digit million range for the same period. It recorded total sales of 2.86 billion euros, marking a 35.3% increase compared to the previous year, which was still impacted by Covid. Retail sales climbed by 40% to nearly 2.60 billion euros but fell short of the group's expectations.
M&S extends price lock until Easter and drops price on food essentials
M&S extends price lock until Easter and drops price on food essentials
What: M&S Food is reducing prices on essential food items and extending its price lock campaign to offer customers better value amid the cost-of-living crisis.
Why it is important: This initiative reflects M&S Food's commitment to providing "trusted value" to customers, especially in light of economic challenges. The company aims to balance quality and affordability, maintaining its reputation for high-quality products while addressing the need for more accessible pricing.
M&S Food is expanding its price lock campaign and reducing the prices of 65 essential food items by an average of 6%, building on previous price cuts on over 200 products. The price lock on 140 products will be extended past Easter to support customers during the ongoing cost-of-living crisis. M&S recently announced rewards for employees participating in the M&S share save scheme, with over 9,200 employees set to receive more than GBP10,000 each due to strong sales performance. M&S's sales during the festive period showed a significant increase, with food business revenues reaching GBP 2.3 billion.
M&S extends price lock until Easter and drops price on food essentials
Woolworths is involved in a culture war in Australia
Woolworths is involved in a culture war in Australia
What: Woolworths has decided to stop selling Australia Day’s merchandise, which infuriates the country.
Why it is important: Do you need to keep selling loww-making merchandise to avoid local political traps?
Australia Day, marked on January 26, has become a contentious date due to its colonial origins. This year, the debate intensified after Woolworths, Australia's largest retailer, announced it would not stock Australia Day merchandise like caps, temporary tattoos, and flags, citing declining demand and a broader community discussion about the holiday's significance.
Australia's main center-right opposition party called for a boycott of Woolworths, criticizing the decision as "against the national interest." Following his call, two Woolworths stores in Queensland were vandalized. Australia's Prime Minister, Anthony Albanese, responded by highlighting his focus on fighting inflation over engaging in culture wars. The controversy reflects a global trend where companies' social stances are increasingly diverging from traditionally pro-business political parties.
The debate also coincides with increased scrutiny of ESG (Environmental, Social, and Governance) policies in corporate strategies. Amidst high inflation rates, Woolworths has also faced allegations of profiteering. A YouGov poll showed that while only one-fifth of Australians supported Dutton's boycott call, the majority were more concerned about excessive supermarket pricing. Despite the debate, some see Woolworths' decision as a typical business strategy shift to align with evolving consumer values. The Australian retail sector, generating significant revenue and employment, is seen as adapting to changing community values.
Does the KaDeWe bankruptcy have consequences for the Galeria stores?
Does the KaDeWe bankruptcy have consequences for the Galeria stores?
What: The bankruptcy of the KaDeWe Group, which operates luxury department stores in Germany, is not expected to impact the rescue efforts for the mainstream retailer Galeria Karstadt Kaufhof.
Why it is important: The KaDeWe Group's bankruptcy highlights the distinct challenges within different retail segments, underscoring the complexity of navigating insolvency and restructuring in the retail industry, especially when contrasting luxury and mainstream markets.
The insolvency of the KaDeWe Group, which includes luxury department stores like KaDeWe in Berlin, Oberpollinger in Munich, and Alsterhaus in Hamburg, is not expected to negatively influence the rescue opportunities for Galeria Karstadt Kaufhof, according to retail expert Thomas Roeb. Despite the shared ownership under Signa Retail, the distinct market and operational requirements between luxury and mainstream retail segments suggest that interests in Galeria's rescue are separate from the premium sector challenges faced by KaDeWe. The bankruptcy aims to address unsustainable rent costs among other issues, with operations continuing at the stores. Observers speculate on the potential interest of the Central Group in acquiring more shares in KaDeWe Group during the bankruptcy, but the overall outlook for saving a significant number of Galeria stores remains unchanged and challenging.
Does the KaDeWe bankruptcy have consequences for the Galeria stores?
Nike challenger Anta faces fresh rivals in Chinese sportswear race
Nike challenger Anta faces fresh rivals in Chinese sportswear race
What: Made in China brands are exponentially growing and at-home competition is fierce.
Why it is important: Some of them are increasingly credible for overseas expansion. They might be a solution for department stores looking for an alternative to the big Western names going DTC.
In 1987, Ding Shizhong began transforming his family's small shoemaking business in Fujian, China into Anta, a major sportswear retailer. Anta grew rapidly, surpassing Adidas as China's second-largest sportswear brand with $7.8 billion in annual revenues. This growth was fueled by strategic acquisitions, including Fila's China rights and Finland’s Amer Sports.
However, Anta faces challenges with slowing growth in China and adapting to evolving sportswear trends. Financial pressures from a significant loan for the Amer Sports acquisition have led to plans for an IPO. Anta is responding to market shifts and increased competition by refining its product lines and adopting a direct-to-consumer retail model. Despite these hurdles, Anta remains a key player in the dynamic sportswear industry.
Nike challenger Anta faces fresh rivals in Chinese sportswear race
Fortnum & Mason creates major window installation for gifting
Fortnum & Mason creates major window installation for gifting
What: Fortnum & Mason has unveiled a window collaboration with six street artists for the launch of its new ‘Unleash the Love’ gifting collection.
Why is it important: Fortnum & Mason, a high-end department store in London, has launched its 'Unleash the Love' gifting collection, accompanied by a unique window collaboration with six street artists. The collection, inspired by the eight types of love in Greek philosophy, aims to celebrate various forms of love. The artists, working with art curation and consultant collective Gone Rogue, were given complete creative freedom to interpret the theme of 'love' in their street-art designs.
The display showcases Fortnum & Mason's commitment to supporting diverse art forms and integrating them into its retail experience. The project not only adds a unique aesthetic appeal to the store's windows but also broadens the concept of love beyond Valentine's Day, reflecting its various forms and interpretations. Additionally, the auction of these artworks for charity highlights the store's engagement with the community and its efforts to contribute positively. This initiative represents a blend of art, commerce, and philanthropy, enhancing the cultural and social value of the retail space.
Fortnum & Mason creates major window installation for gifting
Amazon points AI at fashion fit problem
Amazon points AI at fashion fit problem
What: Amazon Fashion has introduced new AI-driven features to address the fit problem in fashion e-commerce.
Why it is important: The new tool aims to address the fit problem in fashion e-commerce, reduce returns, and improve the overall shopping experience for customers and brands.
These updates include personalized size recommendations, AI-generated Fit Review highlights, and standardized size charts for customers. One significant addition is the Fit Insights Tool, designed to provide brands with AI-driven insights on product fit and sizing issues based on customer feedback. The tool uses large language models to extract and aggregate customer feedback to identify defects in size charts, offering brands valuable data to improve their products and sizing information.
The personalized size recommendations algorithm evaluates sizing relationships between brands, reviews, and customer fit preferences to recommend the best-fitting size for each individual. The AI-generated fit review highlights summarize customer feedback, helping shoppers make informed decisions about sizing.
Lastly, Amazon has improved its size charts using AI to enhance accuracy and consistency, making them easier to follow and potentially addressing the variability in sizing systems across styles and brands.
Marquette, a new French concept dedicated to DNVBs
Marquette, a new French concept dedicated to DNVBs
What: Marquette, a lifestyle concept store gathering DNVBs and designed for shopping centers, is planning to expand its presence with four new store openings in 2024, targeting a total of ten stores by the end of the year. The store features a vibrant and colorful layout and offers products from web-born brands (DNVBs) and other trendy brands across various categories like fashion, beauty, and leisure.
Why It Is Important: In the wake of Showfields collapse in the US, Marquette's expansion reflects a successful adaptation of the retail model, integrating online-born brands into physical shopping centers and diversifying its product range beyond DNVBs.
Originating from a collaboration between Digital Native Group and Carmila (Carrefour group), Marquette opened its first store in 2020 and has since grown to six locations in France. Marquette growth strategy not only enhances the mall experience by introducing unique and sometimes lesser-known brands but also demonstrates the viability of a consignment sales model in the retail sector. With plans for e-commerce and potential home delivery services in the future, Marquette is said to already be profitable.
Lotte department store partners with Bacha Coffee for South Korean expansion
Lotte department store partners with Bacha Coffee for South Korean expansion
What: Lotte Department Store has signed an exclusive franchise and distribution deal with Moroccan coffee brand Bacha Coffee to introduce the brand in South Korea.
Why it is important: This partnership marks a significant expansion for Bacha Coffee into the South Korean market, leveraging Lotte's extensive retail network. The move reflects the growing trend of global food and beverage brands collaborating with major retail chains to tap into new markets. For Lotte, this deal diversifies its offerings, enhancing its appeal to customers by providing a unique and premium coffee experience. The collaboration also signifies the increasing importance of experiential retail, where shopping is combined with distinctive culinary experiences.
Bacha Coffee, known as the "Hermes of coffee," is set to enter the South Korean market through a franchise and distribution agreement with Lotte Department Store. The first store will open in Seoul's Cheongdam-dong district in July, with plans for further expansion through department stores, e-commerce, and B2B partnerships. This expansion is part of Bacha Coffee's broader growth strategy, which includes recent launches in Taiwan and the UAE.
Lotte department store partners with Bacha Coffee for South Korean expansion
Fortnum & Mason is expanding and considers entering the US
Fortnum & Mason is expanding and considers entering the US
What: It seems that luxury food is thriving in London.
Why it is important: Gourmet halls are increasingly important for department stores, and many should get inspired by what is going on at F&M since the arrival of their new CEO, Tim Athron
Fortnum & Mason, the iconic London department store known for its luxury goods and specialty teas and jams, is set to expand following a particularly busy Christmas season. The 317-year-old retailer experienced a 17% increase in sales and processed over 400,000 orders in the five weeks leading up to Christmas Eve, with orders coming from as far as Bermuda and New Zealand. This surge in demand put significant pressure on its infrastructure.
To address these challenges, Fortnum & Mason has decided to relocate its main UK warehouse to Corby in Northamptonshire, which offers twice the space of the current facility. However, this expansion comes with a downside, as smaller warehouses across the UK will be closed, and 94 jobs are under consultation.
Despite these changes, Fortnum & Mason is not struggling. Since CEO Tim Athron took over in 2020, the store has been working to broaden its appeal beyond its traditional elite customer base. This strategy appears to be successful, as indicated by a 12% increase in annual sales in the year to July 2023. The flagship store in Piccadilly now features a creative hub for food and drink, a test kitchen, and a gin distillery. Additionally, there are discussions about opening a store in the US, although this has not been confirmed.
Fortnum & Mason Christmas sales jump 17%
Fortnum & Mason Christmas sales jump 17%
What: During the Christmas period Fortnum & Mason experienced a significant sales increase, with revenue rising by 17% compared to the previous year.
Why it is important: The significant sales increase shows the company’s successful management of inflationary pressures and potential for sustained growth.
The refurbishment of its flagship London store and the reopening of the third floor contributed to a 30% rise in customer numbers, surpassing 6 million visitors. The restart of deliveries to the EU and the overall growth in 2022 boosted the company's performance. Despite facing inflation and increased costs for food and labor, Fortnum & Mason managed to achieve 12% revenue growth and a 23% pre-tax profit increase.
Although online sales fell by 11% compared to the previous year, they still accounted for 36% of retail sales, with plans to consolidate distribution centers to address growing demand. The company's CEO, Tom Athron, expressed confidence in managing inflationary pressures and foreseeing a shift in price increases.
Walmart to close Store No. 8
Walmart to close Store No. 8
What: Walmart is closing its innovation unit, Store No. 8, which was established to foster technological advancements and compete with Amazon. The closure will see the departure of Scott Eckert, who led the unit.
Why it is important: This move signifies a strategic shift in Walmart's approach to innovation, indicating a possible realignment of resources and priorities within the company.
Walmart has announced the shutdown of Store No. 8, its technology and business innovation unit, which was instrumental in developing initiatives like in-home delivery and voice shopping. The unit, launched in 2017, was a key player in Walmart's efforts to rival Amazon, focusing on areas such as health and wellness, sustainability, social commerce, and the metaverse. With the closure, Scott Eckert, the senior vice president in charge since June 2019, will exit the company. Walmart's CFO, John David Rainey, stated that the responsibility for future innovations will now be distributed across the company. This decision reflects Walmart's evolving strategy in embracing new revenue streams and adapting to market trends. The announcement comes as Walmart prepares for its fourth quarter and year-end earnings call, following a year where it saw a 5.2% increase in Q3 global revenue but also observed cautious customer spending.
Liberty bets on own-brand goods to drive growth
Liberty bets on own-brand goods to drive growth
What: Liberty goes full speed in private label deployment.
Why it is important: In their specific case, their private label is an internationally recognized brand.
Liberty is focusing on expanding its own-brand offerings, particularly in beauty products. This strategic shift aims to leverage the popularity and higher margins of Liberty's own products, such as its LBTY beauty brand, to drive business growth. Last year, LBTY introduced five luxury perfumes inspired by Liberty's renowned prints, with plans to expand into a full beauty line alongside its existing in-house categories like accessories, womenswear, and homeware.
The CEO noted the strong performance of Liberty’s own products, especially the new perfumes, which have seen high demand and international interest. This success aligns with a broader trend in department stores, where private label sales have significantly increased from 9% to 16% of turnover between 2019 and 2022.
Considering the strong demand for Liberty-branded products, Mehboob-Khan envisions opening new stores dedicated solely to Liberty products, marking the first such expansion since the last century. However, he acknowledged the challenge of replicating the unique charm of Liberty’s iconic Great Marlborough Street building, constructed in 1924.
Liberty’s strategy also includes a significant focus on beauty sales, a segment poised for growth even in a challenging luxury fashion market. The beauty sector, having shown resilience and pricing power even in high-inflation scenarios, is expected to continue expanding globally.
The Liberty group, encompassing its retail business, fabric division, and Liberty Brand, has reported a 23% increase in revenues to £185 million and a pre-tax profit of £712,000 for the year ending January 28, 2023, recovering from pandemic-induced losses.
Galeria Kardstadt Kaufhoh files for a third insolvency in 3 years
Galeria Kardstadt Kaufhoh files for a third insolvency in 3 years
What: Forbes reviews Galeria’s third insolvency in three years.
Why it is important: Central seems more interested to acquire the rest of Signa’s crumbling empire than Galeria. Is that only due to the non-luxury positioning of the company?
Galeria Karstadt Kaufhof, a prominent German department store chain with 15,000 employees, has filed for insolvency for the third time in four years. This follows the debt-fueled collapse of its parent company, Signa, which also owns Selfridges and several landmark properties. The latest insolvency filing at the Essen district court is seen as an effort by Galeria to break free from Signa's influence, which has been criticized for its high rents and restrictive ownership structure.
Previously, during its insolvency in February 2023, Signa Holding had pledged $219 million in new capital to Galeria in exchange for debt write-downs, which included $645 million from German taxpayers. However, the financial difficulties of Signa, particularly after its insolvency in late 2022, cast doubt on this support. Galeria's struggles were exacerbated by the pandemic, inflation, and energy cost hikes due to the Russia/Ukraine war.
Galeria’s CEO, Olivier van den Bossche, views the current development as a liberation from Signa’s high costs and restrictive management. The company has faced scrutiny and public criticism for its reliance on state subsidies and rent practices.
Signa acquired Galeria in 2019 and merged it with Karstadt in 2020, forming Europe’s second-largest department store chain. Since then, Galeria has closed underperforming stores and reduced staff, with plans to cut around 52 locations by the end of the month. The company has already begun discussions with potential investors, as stated by Galeria’s interim administrator Stefan Denkhaus.
Galeria Kardstadt Kaufhoh files for a third insolvency in 3 years
M&S CEO says company needs to rethink Sparks loyalty programme
M&S CEO says company needs to rethink Sparks loyalty programme
What: Marks & Spencer is reevaluating its Sparks loyalty programme following a successful Christmas trading period.
Why it is important: The company’s review of its Sparks loyalty program reflects the evolving landscape of loyalty schemes in the retail industry and their significant impact on consumer engagement and sales.
The CEO, Stuart Machin, expressed the need to reconsider Sparks in the short, medium, and long term, emphasizing a focus on quality, style, and value. Machin dismissed the idea of introducing member pricing via Sparks, highlighting M&S' customers' preference for great products at everyday trusted prices.
M&S CEO says company needs to rethink Sparks loyalty programme
John Lewis considers up to 11,000 jobs cuts
John Lewis considers up to 11,000 jobs cuts
What: John Lewis Partnership is reportedly considering cutting up to 11,000 jobs as part of its ongoing turnaround program.
Why it is important: This significant reduction in workforce highlights the challenges faced by traditional retailers in adapting to the rapidly changing retail landscape, marked by increased online competition, economic pressures, and evolving consumer behaviours.
John Lewis Partnership, a prominent UK retailer, is reportedly planning to cut up to 11,000 jobs over the next few years across its various divisions, including its headquarters, supermarkets, and department stores. This move is part of a broader effort to reduce costs and improve efficiency, particularly through technological advancements. The company has already closed 16 department stores and reduced its workforce, reflecting the struggles it faces in a highly competitive market and the impact of the shift towards online retail. Additionally, John Lewis is modifying its redundancy terms, offering one week's pay per year of service instead of the previous two weeks, starting February 1. This decision aligns with the company's strategy to return to profitability by enhancing customer offerings, investing in technology, and optimizing store operations. The spokesperson emphasized that the company's focus is on improving performance, but acknowledged the unfortunate necessity of reducing the number of employees.
John Lewis CEO says turnaround will focus on making a ‘brilliant retailer’
John Lewis CEO says turnaround will focus on making a ‘brilliant retailer’
What: John Lewis leadership reaffirmed this Christmas that their focus was exclusively on retail.
Why it is important: They have tried hard for the past 4 years to diversify. Is that a sign that retailers can not evolve into new industries?
The leadership of John Lewis and Waitrose, including outgoing chair Dame Sharon White and CEO Nish Kankiwala, has committed to prioritizing retail in their strategy to revitalize the struggling group. Emphasizing a "one retail mindset," they aim to enhance customer experience and operational simplicity across their divisions. This shift in focus comes after efforts to diversify into financial services and build-to-rent projects under White's tenure since 2020. The company, facing increased competition, also seeks to streamline and become more productive, as indicated by changes like flexible working hours at Waitrose. Despite posting a significant loss and anticipating a longer turnaround time, the leadership is determined to maintain its unique employee-owned structure and avoid mimicking competitors or adopting typical corporate strategies. This approach mirrors Marks and Spencer's successful back-to-basics turnaround. However, internal resistance was noted earlier this year when White considered selling a minority stake, a plan later abandoned. White is set to step down by February 2025, marking a brief tenure as chair.
John Lewis CEO says turnaround will focus on making a ‘brilliant retailer’
Neiman’s holiday sales down but less so from the fall season
Neiman’s holiday sales down but less so from the fall season
What: Neiman Marcus Group reported a pleasing outcome for the holiday season, despite facing challenges in the luxury market and a promotionally charged retail sector impacting margins.
Why it is important: Neiman Marcus’ successful holiday sales performance in the current luxury retail environment gives insight into the company's strategies to drive sales and maintain profitability
CEO Geoffroy van Raemdonck highlighted a sequential improvement in sales trends from the previous quarter and growth in spending among top customers and luxury categories such as jewellery, designer handbags, and beauty. While NMG did not provide specific holiday sales figures, adjusted EBITDA eased to USD 95 million from USD 112 million in the prior year, with sales totalling USD 948 million versus USD 1.034 billion previously.
The company attributed its success to over 1,000 experiences held during the holiday season, leveraging customer insights and real-time data to drive personalised, relationship-based sales. Although NMG underperformed the overall retail industry, it remains optimistic about revolutionising luxury experiences through financial flexibility, investments in experiences, and building relationships with brands and customers.
NMG plans to focus on high-value customers, emphasising in-store and remote selling, as well as long-standing relationships with luxury brands to drive growth and provide valuable retail partnerships. The company aims to drive high customer lifetime value by focusing investments on customers seeking the most desirable luxury brands.
Neiman’s holiday sales down but less so from the fall season
Fashion repair and alter platform Sojo opens in Selfridges
Fashion repair and alter platform Sojo opens in Selfridges
What: Sojo has opened its first permanent concession in Selfridges’ Oxford Street flagship in London.
Why it is important: This move highlights the growing trend towards sustainable fashion practices and the integration of circular initiatives in mainstream retail, emphasizing the importance of clothing repair and alterations in reducing waste and promoting sustainability in the fashion industry.
Founded by Josephine Philips, Sojo offers in-person fittings and consultations for tailoring and repair needs, with most services completed at its East London studio. The platform, which started as part of Selfridges’ Reselfridges program, aims to reduce returns and increase circularity in fashion. It provides emission-free delivery of repaired items within a week and offers same-day service for express alterations. Sojo's partnership with Selfridges and its collaboration with brands like Ganni and Nanushka signify a significant step towards sustainable fashion solutions in the retail sector.
Luxury e-commerce players face a whole new reality
Luxury e-commerce players face a whole new reality
What: There is a changing landscape of luxury e-commerce and challenges faced by the first movers in this sector, such as Yoox Net-a-porter, Matches, and Farfetch.
Why it is important: The power and influence of multibrand e-tailers have diminished, with many luxury brands opting to build their own online retail presence.
These e-commerce platforms, which revolutionized the luxury retail experience, have seen a decline in their value and relevance due to shifts in market forces and the brands' direct-to-consumer initiatives.
Despite the challenges, there is recognition of the ongoing value of multibrand retailers in terms of curation, convenience, and trust. The article emphasizes the need for these e-commerce players to adapt to the changing dynamics and redefine their roles for sustained relevance. Mytheresa, a smaller player in the European luxury e-commerce market, has demonstrated consistent growth and profitability amidst the challenges, suggesting that adaptation and strategic positioning are crucial for success in this evolving landscape.
Surviving UK department stores seek to avoid fate of fallen rivals
Surviving UK department stores seek to avoid fate of fallen rivals
What: A review of UK department stores’ situation in early 2024.
Why it is important: We start hearing analysts mentioning that the pandemic was not responsible for the fall of previously iconic companies, which were structurally unfit for the new generation customers.
John Edgar, CEO of Fenwick, is overseeing a significant renovation of their flagship Newcastle store, including adding windows and opening up interior spaces. This £40 million project reflects a broader trend among department stores to reinvent themselves in response to challenges like online competition, reduced customer spending, and high operational costs. The department store sector has seen notable declines, with an average annual revenue contraction of 2.7% over five years to 2023.
Fenwick's effort is part of a wider industry movement where department stores must innovate or face extinction. Edgar emphasizes the importance of creating a unique shopping experience, moving away from competing solely on price. Other stores, like Fortnum & Mason, are focusing on creating engaging, thematic environments to attract customers. This shift comes as department stores, once staples of retail, grapple with changing consumer habits and the rise of online shopping.
Despite the challenging landscape, Fenwick remains optimistic, partly due to its family ownership which allows for a long-term perspective. However, the sector has seen its share of closures and hardships, as exemplified by Debenhams and House of Fraser. The future of department stores seems to hinge on their ability to provide unique, experiential shopping environments that differentiate them from both online retailers and each other.
Surviving UK department stores seek to avoid fate of fallen rivals
A phygital fashion collection has been launched by a virtual human
A phygital fashion collection has been launched by a virtual human
What: A “virtual human” has launched the first fashion collection of such type ever.
Why this is important: Virtual Humans can drive traffic and increase awareness for retailers, as shown by Lulu from Brazilian retailer Magazine Luisa.
China's first hyper-realistic digital human, AYAYI, has launched a fashion brand named after herself. The brand blends physical and digital elements ("phygital"), using augmented reality (AR), mixed reality (MR), and generative AI to enhance customization and the consumer experience. The inaugural collection, "Dimensional Explorer," inspired by wingsuit flying, features garments each paired with a digital avatar, created through innovative digital assets and AIGC technology exploration.
In addition to real models, AYAYI herself appears in digital form modeling these outfits. A promotional video highlights the collection's minimalist street-style clothing alongside AR avatars exploring urban and mixed reality landscapes.
AYAYI, developed by Ranmai Technology using Epic Games’ MetaHuman in Unreal Engine, was China's first MetaHuman. She has already made a mark as a virtual influencer in various campaigns and is now venturing into phygital fashion, bridging the gap between the digital and real worlds.
A phygital fashion collection has been launched by a virtual human
