What: Macy's has launched a new digital fashion platform called "mstylelab" that offers immersive experiences for shoppers.

Why it is important: The "mstylelab" platform aims to redefine fashion by seamlessly integrating immersive experiences and technology, empowering discovery, self-expression, and connectivity for both existing and new shoppers.

The platform features a metaverse journey where users can navigate a surrealistically depicted New York City and explore styles from Macy's On 34th private brand. The experiences on mstylelab are shoppable, allowing users to add items to their shopping cart. The platform aims to connect with existing Macy's customers and attract new ones, especially those who are more web- and tech-inclined. The next activation on mstylelab will focus on the Macy's Thanksgiving Day Parade.

Macy's partnered with Journee, a company specializing in immersive digital spaces, to create the mstylelab fashion experience. The platform is accessible on any device, using any browser, at macys.com/mstylelab.

Macy’s launches ‘Mstylelab’ digital fashion platform

What: According to John Lewis, predictions of the death of the high street have been overstated, as online sales have fallen while store visits have increased.

Why it is important: This information indicates a potential shift in consumer behaviour and provides insight into the company's recovery plan and financial performance expectations.

Online transactions accounted for 57% of the retailer's sales in the past year, down from 81% during the height of the pandemic, while store customers were up 8% compared to the previous year. The increase in in-person visits can be attributed to events held by John Lewis, such as a kitchen disco hosted by singer Sophie Ellis-Bextor. The company also saw a 70% increase in tailoring sales, which require customers to visit stores for fittings.

Despite uncertainties in the economic outlook, John Lewis expects its full-year financial performance to improve compared to the previous year's pre-tax loss of GBP 77.6m.

John Lewis: Death of the high street predictions are ‘overstated’

What: The challenges faced by retailers in managing online returns and the rising costs associated with them.

Why it is important: Effective management of online returns is crucial for retailers to reduce costs, protect profit margins, and enhance the shopping experience, ultimately leading to higher sales.

The introduction of free returns by Amazon in 2005 set new customer expectations and put pressure on brands and retailers to offer the same service. However, the costs of processing returns, including shipping and sorting, have continued to rise, especially during the COVID-19 pandemic. To offset these costs, some companies have started charging customers for returns.

Effective returns policies go beyond charging fees and should focus on attracting customers who make informed purchasing decisions to minimize returns. Start-ups are emerging to help brands implement strategies such as offering credits towards new items instead of full refunds and facilitating at-home pick-ups.

Brands like Monos, Ana Luisa, Mytheresa, and Revolve, which have implemented different approaches to returns management. Overall, managing returns efficiently while improving the shopping experience is crucial for retailers to protect their profit margins and generate higher sales.

Fashion’s new playbook for online returns

What: Duty free operator Heinemann goes digital and smart with its new store format in Copenhagen.

Why it is important: Department stores need to pay attention to what’s happening in travel retail to remain on par with tourists’ expectations.

Gebr.Heinemann has launched a digital 'experience space' at its travel retail store in Copenhagen Airport. Themed 'fluid perspectives', this innovative space has interactive digital floors showcasing moving water and screens offering details about the significance of water in Denmark. Five brands are currently featured in this pilot phase, including Narciso Rodriguez and MessyWeekend, all highlighting their environmental connections. The brands will rotate frequently, aiming to provide regular travelers with a constantly evolving experience.

On a separate note, Heinemann is set to expand its 'all yours' retail and F&B concept at Nuremberg Airport, merging duty-free, dining, and convenience into one space, doubling the current commercial space to 13,000 square feet. The brand is planning further expansions to other European airports.

Duty Free operator Heinemann releases new airport store format

What: Frasers has submitted a planning application for a new global headquarters campus in Ansty, Rugby, Warwickshire.

Why it is important: Frasers Group aims to use this move to support its elevation strategy, sector-leading ecosystem, and growth ambitions.

If approved, the move will create 7,500 jobs and contribute GBP 300 million in gross value added to the region. The new campus, designed by Grimshaw Architects, will include logistics space, offices, R&D facilities, retail outlets, a hotel, and leisure facilities. The proposal also includes a gym and bookable courts and pitches that will be open to the public.

In a cost-cutting and streamlining effort, Frasers Group plans to reduce up to 200 head office jobs, accounting for around 20% of its staff in London and Shirebrook. This decision is part of a broader restructuring plan following strategic acquisitions and progress in implementing the elevation strategy.

Frasers Group plots HQ move

What: The modest increase in LVMH's revenues and the slowdown in luxury spending highlights changing consumer behaviours and economic conditions in key markets.

Why it is important: The results reflect a normalisation of growth rates in its fashion and leather goods division as inflation and high interest rates impact discretionary spending.

LVMH's quarterly revenues were below analysts' estimates, indicating a slowdown from the previous quarter; the 3-months to September 30th revenues were EUR 19.96 billion, which is below the Bloomberg estimate of EUR 21.15 billion. The fashion and leather goods division saw a 9%  increase in sales on a like-for-like basis, but this was lower than the growth recorded in the second quarter.

LVMH cited uncertain economic conditions in Western economies and challenges in China as contributing factors to the slowdown. Despite the moderation in growth, LVMH remains confident in the performance of brands like Dior and is focused on optimising store numbers and category mix. Demand softened in Europe and Asia, while the U.S. saw unchanged trends. In Asia, Chinese spending on fashion and leather goods outside of Asia doubled compared to the previous year.

LVMH plans to continue marketing initiatives and expects the second half of the year to be full of new initiatives although the company's chief financial officer, Jean-Jacque Guiony, stated that it is too early to determine whether the slowdown in luxury spending is temporary or long-term.

LVMH announces its Q3 results 

What: While Indonesian regulation was a premiere, and some European countries might follow suit, TikTok is actively looking for ways to go around regulation.

Why it is important: Department Stores can not count on regulation to escape TikTok and need to polish their competitive advantages instead.

TikTok, owned by Beijing-based ByteDance, is devising strategies to sustain its ecommerce arm in Indonesia, which is its largest market. This move comes after Jakarta banned transactions on social media platforms, a decision seen as primarily targeting TikTok's shopping platform launched in Indonesia in 2021.

TikTok's response includes the idea of creating a separate online commerce platform distinct from its video app, to appease regulators.

The ban impacts approximately 6 million sellers and nearly 7 million influencers on TikTok Shop in Indonesia.

Previously, ByteDance had aspirations of achieving around $6 billion in gross merchandise value in Indonesia for 2023. Indonesia was the foremost and most significant market for TikTok Shop, indicating a potential model for other markets. Still, ByteDance has had challenges in the west replicating the popularity of its in-app livestream shopping model.

Management is considering partnerships with local retail entities, such as technology leader GoTo, to resume ecommerce operations. Concerns exist about the implications of creating a separate app for other markets, particularly if it sets a precedent for markets like the U.S.

Some analysts believe TikTok should abandon its Indonesian ecommerce ambitions to prioritize opportunities in larger markets like the U.S.

TikTok shops around for options in wake of Indonesia app ban

What:  Marks & Spencer has announced Mother as its new creative agency for its UK clothing business.

Why it is important: The aim of the partnership is to evolve M&S and drive style perceptions by improving the visual aesthetic of communications and incorporating customer-centric thinking into marketing.

The partnership will replace the former deal of House 337 as M&S's creative agency. Mother will collaborate with the retailer's in-house creative team on certain projects.

M&S names Mother as its new creative agency for clothing

What: Walmart is making a renewed effort to establish itself as a fashion destination by revamping its apparel offerings and store layouts.

Why it is important: Walmart’s strategic shift towards fashion signals a potential shift in the affordable fashion market landscape.

The retailer has added over 1,000 new brands, including Reebok and Levi’s, and is working with designer Brandon Maxwell on two private labels. They are remodelling hundreds of its stores to make them more appealing for clothing shopping, with features like softer lighting and mannequin displays.

Despite past failed attempts to revamp its apparel category, Walmart believes the current economic climate and changing consumer attitudes present a new opportunity. The company aims to attract younger, fashion-conscious customers and capitalise on the trend of value-driven shopping.

Can Walmart finally crack fashion?

What: A piece exploring the reasons why Sharon White is the shortest chairman at John Lewis in the history of the retailer.

Why is it important: John Lewis has been struggling for the past decade or so, and is in need of a structural fix.

Sharon White's decision to leave her role as the boss of John Lewis took many in the company by surprise. Her tenure of five years will make her the shortest-serving chair in the company's history. Her leadership came at a challenging time, as she joined just before the COVID-19 pandemic, which turned many city centers into ghost towns. White faced scrutiny for various strategic moves, including store closures, slashing debt, and restructuring efforts. However, she was also criticized for her lack of retail experience and her decisions that seemed to divert focus from the core retail business.

Some criticized her leadership style, suggesting she wasn't listening enough to experienced staff. There were also concerns about her political decisions and the potential sale of significant assets. Her successor will need to decide whether to continue with her strategies or shift direction. As she departs, there are rumors of her potential involvement in a senior role within a new Labour government. The future of John Lewis now hangs in the balance, especially with an upcoming important Christmas season.

Was Sharon White too clever for retail?

What: Weak signals on the art market are no good for the luxury industry.

Why is that important: any downturn in luxury will affect department store businesses, where the category has been a lifesaver so far.

Art collectors in Hong Kong recently faced hesitation from bidders, leading auction house Phillips to advise sellers to reduce prices. They mentioned at a summit that artworks, which once sold at thrice their auction estimates, are now fetching around half that.

Concurrently, luxury goods, closely linked to contemporary art, are seeing shifts. Shares of LVMH, which owns brands like Dior and Louis Vuitton, dropped by 7% after disclosing slowing sales. While LVMH still reported strong revenues, there was a deceleration in growth from 17% to 9%.

This could be a gentle sobering from post-pandemic consumption or a return to cyclical luxury spending. Factors like global conflicts and China's restrictions on wealth export also impact luxury and art sales.

Despite this, luxury brands still largely depend on the super-rich; a small shift in their purchasing habits can impact majorbrands. LVMH's Arnault remains optimistic about continued growth, but adapting to changing markets is crucial for both art and luxury sectors.

The art market might give a glimpse of what luxury retailers should expect

What: The Printemps group and the French Fashion Institute (IFM) have partnered to support young fashion entrepreneurs in France.

Why it is important: Printemps and IFM aim to promote wider access to fashion industry jobs.

They will offer new scholarship schemes to enhance fashion knowledge and entrepreneurship in the country. The scholarships will be based on financial need and merit and will cover tuition fees for a professional training course in fashion at IFM. The course focuses on fashion designing, machinist-fitting, and model-making.

In addition to the scholarships, five brands at the IFM incubator will receive financial support for the development of innovative products and services in the creative industries. The brands selected include Mama Série Originale, Ako, Askiita, Noué, and The Wedding Explorer.

Printemps group teams up with IFM

What: Frasers Group has sold Missguided to Shein in a deal that includes the joint venture between Shein and Missguided's founder Nitin Passi.

Why it is important: This deal aligns with Frasers Group's strategy to focus on fewer brands while maintaining a presence in women's digital-first fashion.

Frasers Group has divested the intellectual property (IP) of Missguided to Shein while retaining its real estate and employees. The deal has sparked exciting discussions around potential collaboration between Frasers Group and Shein. With the acquisition, Shein aims to reignite the Missguided brand, capitalizing on its unique brand personality and fuelling its global growth.

Missguided's products and collections will be manufactured through Shein's on-demand production model and sold on Shein sites and Missguided.com. The joint venture will manage Missguided and license the brand IP to Sumwon Studios.

Frasers Group sells Missguided to Shein 

What: Mango ventured into multi-brand e-commerce in 2021 by adding Intimissimi and later Rituals to its offerings. However, they have now chosen to discontinue selling these brands.

Why it is important: The company has decided to focus on their own sales channel and improve customer experiences.

The marketplace was initially launched in six markets, including Spain, the Netherlands, Germany, the United Kingdom, Portugal, and France.

Mango considers its online channel to be essential, accounting for 36% of its business in the last fiscal year. In the first half of 2023, Mango's e-commerce operations grew by 10%, with the mobile application witnessing the most significant increase in revenue

Mango shuts down marketplace after two years of operation

What: DFS is planning to open a "seven-star" luxury retail and entertainment destination called DFS Yalong Bay in Hainan, China by 2026.

Why it is important: The development has the potential to attract millions of visitors and contribute to the growth of Hainan's luxury retail market.

The project is set to cover over 1.38 million square feet and offer more than 1,000 luxury brands, including those from LVMH. The site will feature immersive experiences across various categories such as fashion, beauty, watches, fine dining, and more. Hainan has become a popular travel destination during the pandemic, and by 2025 it is expected to become a free-trade port. DFS believes the location could attract over 16 million visitors annually by 2030. The company aims to create a luxurious and entertaining experience that goes beyond traditional luxury retail. They have coined the term "seven-star" to describe the unparalleled level of luxury they intend to offer.

DFS is to open ‘Seven Star’ luxury retail and entertainment destination in Hainan

What: Thai luxury mall Siam Paragon opens a space dedicated to innovation, accessible to all.

Why it is important: Due to the local competition, Thailand is now a strategic scene in terms of retail innovation.

Siam Paragon, a renowned shopping center in Bangkok, in partnership with SCBX, has unveiled the Siam Paragon Next Tech x SCBX. This is described as a collaborative tech ecosystem dedicated to learning, technology, investment, and social media.

Established with an investment of over 200 million baht (about $5.48 million), this 4,000 sq.m. hub promotes the exchange of knowledge and is designed to prepare individuals for the digital age.

Its grand launch gathered influential tech figures from companies such as NFT Now, Microsoft, and Ant Group. Siam Paragon views this initiative as a pioneering platform for collaborative innovation, aiming to redefine lifestyles for the "World of Tomorrow". The concept emphasizes co-creation and sustainability, with initiatives like the 'Trusted By Synnex E-Waste' project for electronic waste management. SCBX aims to make this facility a cornerstone for fintech in the region, featuring areas dedicated to developers, innovation workshops, and financial tech showcases. Seven "Future Communities" focus on areas such as blockchain, health tech, AI, gaming, and social media. Moreover, a dedicated stage for events can host up to 300 people for seminars and art displays.

Siam Paragon intends to invest over 3 billion baht (approximately $81.4 million) this year in its transformation.

Siam Paragon unleashes collaborative digital tech ecosystem

What: The Council of the European Union has voted for revised legislation to strengthen the framework for split and deferred payments.

Why it is important: Concerns have been raised about the potential impact on interest-free short-term credits, which may face the same regulatory burden as long-term credit.

This legislation aims to regulate credits of less than EUR 200 and Buy Now Pay Later offers, which have seen significant growth in recent years, especially among younger consumers. Service providers offering these credits will be required to clearly present the total cost of repayment and ensure that customers are able to repay their loans. Consumers will also have a 14-day period to cancel their credit.

The revised legislation also includes stricter rules on advertising to reduce abusive credits and measures against overbilling.

The European Union will strengthen the framework for split and deferred payments

What: Amazon UK will invest GBP 170 million to increase the pay of its frontline operations staff.

Why it is important: Minimum starting pay will increase by at least one pound an hour from Oct. 15. Pay will range between GBP 11.80 and GBP 12.50 depending on location, and it will further increase to between GBP 12.30 and GBP 13 by April next year.

Amazon UK to invest GBP 170 million to increase staff pay 

What: As the chairman just announced her departure in 2 years, making it the shortest tenure in the history of the retailer, the company maintains its plans to diversify towards housing

Why it is important: Many critics argue this is making the company lose focus on its core mission. Advocates maintain this is a way to address the future.

John Lewis Partnership (JLP) is advancing its property-to-rent initiative, aiming to develop its brownfield sites for housing. This decision remains steadfast even as chairman Sharon White, who initiated this plan, is set to depart at the end of her term. Nina Bhatia, JLP's executive director for strategy and commercial development, highlighted the company's substantial property estate, indicating its potential for creating quality housing on brownfield sites. The plan involves offering long-term rental options, including affordable housing, without selling the homes. While the scheme addresses the UK's housing shortage, some criticize it for shifting JLP's attention from retail, especially when their John Lewis and Waitrose chains face challenges. Initial developments target London, where a significant portion of the population rents. JLP views this venture as an opportunity to enhance local communities, creating jobs, new communal spaces, and introducing new Waitrose shops – which also serve as John Lewis click & collect locations. Investment firm Abrdn is backing the Build to Rent business with a £500 million investment, aiming to construct 1,000 homes. JLP aspires for this project to constitute 40% of its profits by 2030. Recent figures showed JLP reduced its losses, with sales rising 2% year-on-year. However, the company acknowledged a more extended turnaround period due to inflation.

In spite of opposition John Lewis keeps focusing on real estate

What: A piece from Microsoft arguing how AI could help people in cyberdefence to be more prepared against threats, at a fraction of the cost.

Why it is important: Should department stores focus on AI applied to cyberdefence to kill two birds with one stone instead of focusing on customer-facing interfaces?

The rapid innovation in technology also means a constant evolution in cyber threats.  Historically, defenders have faced challenges as attackers can strike anywhere, anytime, often taking months to detect.

However, as technology becomes even more integral in our lives, there's a pressing need to empower defenders against cyberattacks. AI has the potential to be this game-changer, offering real-time insights and defenses against threats.

Generative AI, a result of years of research, will be transformative for cybersecurity, providing tools that anticipate and prevent attacks. Modern AI models can be harnessed to enhance security measures, enabling faster breach detection and threat response.

Meanwhile, the security industry faces challenges like talent shortages and lack of diversity. AI can help bridge these gaps, providing training and assistance for new entrants and optimizing the tasks of experienced professionals. The security industry needs to be as diverse as its adversaries.

To harness AI's full potential, the industry must embrace varied perspectives, ensuring that this transformative technology benefits everyone.

AI shifts the balance of powers in cybersecurity

What: Microsoft plans to help retailers willing to go retail media.

Why it is important: The race to retail media is going to intensify soon.

Microsoft has unveiled a new advertising network for U.S. retailers to streamline the initiation of retail media campaigns. This platform connects retailers with a broad consumer base, amplifies their offsite reach to boost website traffic via co-branded ads, and introduces an alternative purchasing route. Even those with their own retail media marketplaces can tap into this network for extra high-margin revenue. Establishing a retail media program usually demands considerable effort and resources, but Microsoft promises a swift and profitable program launch. The tech giant acquired PromoteIQ, which later became Microsoft Retail Media, to aid retailers in enhancing shopping experiences. Retailers now leverage AI and ML to offer tailored ads. Insider Intelligence reports underscore the growing influence of retail media in search ad spending, with Amazon dominating the scene. U.S. retail media search ad income is predicted to grow significantly faster than other search advertising in the current year.

Microsoft goes Retail Media

What: The BCG reviews how AI is used in the corporate environment.

Why it is important: AI is a tool, not an endpoint, and might create a loss of creativity within organizations.

In an experiment with over 750 BCG consultants, people used generative AI (GPT-4) very effectively for creative ideation, boosting performance by 40%. But for complex business problem solving, a task outside GPT-4's competence, relying on its output reduced performance by 23%.

People seem to mistrust AI where it can add value, but trust it too much where it lacks competence. This held true even when participants were warned of GPT-4's limitations.

Using GPT-4 led to a 41% drop in diversity of ideas, as people converged on the AI's repetitive outputs. 70% of participants worried relying on AI may reduce their own creativity over time.

To benefit from generative AI, companies need an advanced data strategy, new roles/workflows that focus human effort on the remaining uniquely human tasks, strategic workforce planning to cultivate diversity of thought, and rigorous testing and experimentation as AI capabilities rapidly advance.

Generative AI adoption poses a double-edged sword - tremendous gains in efficiency but also risks around overreliance. Leaders must approach it as a massive change management challenge.

How people create (and destroy) value thanks to AI

What: Marks & Spencer has announced the relaunch of its 'Early Careers Programmes' for 2024, increasing the number of available places fourfold.

Why it is important: Increasing the availability and scope of the 'Early Careers Programmes'  helps the company identify, develop, and nurture talented individuals who can become future leaders in the retail industry.

The programs have been redesigned to focus more on the in-store experience and are aligned to key business areas such as Retail and Clothing & Home. The Retail Leaders Programme aims to attract 114 participants, including 38 school leavers and 76 graduates, reflecting M&S's commitment to developing future leaders. Participants in the program will gain hands-on experience from day one and by the end of the two- or three-year program, they will be managing their own store. M&S CEO Stuart Machin has been personally involved in shaping the programs, drawing on his own career trajectory.

M&S boosts Early Careers Programmes in search for future retail leaders

What: Inside Retail analysis of the key success factors at Central Retail.

Why it is important: Due to the intense competition there, Thailand has become a playground for experiential retail innovation.

Central Retail, a major Thai conglomerate, inaugurated its second eat-shop-play lifestyle center in the Chalong district of Phuket on October 6th. This follows the opening of their first Robinson lifestyle center in Thalang, Phuket, a year prior. The new Chalong mall boasts 17,000sqm of leasable area, with an 8,000sqm Robinson department store as its anchor. Central Retail has launched 28 such lifestyle centers across Thailand, hosting 4,700 tenants and receiving 120 million customer visits yearly.

Although located in tourist hotspots, these centers primarily cater to Thais. They fill a niche in areas that don't necessarily draw primary tourism but have enough consumer demand for a sophisticated shopping experience. The design is sleek, functional, and compact, accommodating a variety of merchandise, food, and leisure options.

Each center is modified slightly for local preferences. For instance, the Chalong center is themed as a “carnival village,” reflecting Phuket’s tourist culture. These centers follow a formulaic design: a ground floor with a Robinson department store, fashion brands from Asia, a mixed merchandise zone, and a Tops supermarket. They also feature Moshi Moshi, a popular Thai chain offering diverse lifestyle products. The upper floor transitions to hard goods, food, and entertainment with brands like Major Cineplex, Banana, Jaymart, Power Buy, Office Mate, B2S, and a food court.

Central Retail's potential influence in Vietnam is anticipated through their growing Go! mall chain. Central Retail ranks as one of Thailand's largest retail conglomerates, with sales being led by its fashion segment, recording a 22% growth year on year.

Eat, Shop, Play at Central Retail malls