What: Chanel is set to open two VIP salons in two key luxury retail markets in Southern China.

Why it is important: Luxury brands are adopting a VIP-first retail strategy to attract big spenders as the Chinese luxury market is expected to be driven by the top 2% of luxury spenders.

Chanel is launching two VIP salons in Guangzhou and Shenzhen, giving the French house a total of five VIP salons in the China market.

The Guangzhou salon, located in Taikoo Hui Guangzhou will span 3,200 square feet and features a discreet façade with a black and white entrance. The invite-only space has four private fitting rooms and a public lounge area.

In Shenzhen, the VIP salon spans 4,300 square feet and is attached to Chanel’s first retail outpost in the city at MixC.

Chanel’s efforts to attract big spenders helped the brand boost 2022 revenues in the Asia Pacific region by 14.3% to USD 8.65 billion, with a double-digit increase in the mainland China market.

Chanel to roll out VIP salons in key Chinese cities

What: A very synthetic view on where US department stores stand in their actions to modernize and woo shoppers back.

Why it is important: Off-price, promotions and essentials are presented as a new recipe, but it might not be sufficient to provide the needed solutions to US department stores.

The article from Modern Retail discusses the challenges faced by department stores and their strategies to win back customers. Department stores have had a tough time during the pandemic, with declining sales and reduced foot traffic. Many consumers have shifted their shopping habits online, contributing to the challenges department stores face in attracting customers back to physical locations.

To attract customers, department stores are focusing on several strategies. Macy’s is investing heavily in its loyalty program and focusing on categories such as home, beauty, fine jewelry, and watches. It's also planning to launch a small-format off-mall store, Macy's Backstage, later this year.

Kohl’s is expanding into "underrepresented" categories like gifting, decor, pet, and outdoor, and it plans to place more gift items towards the front of the store in the coming months. The article mentions that Kohl’s is particularly good at selling "hardcore essentials" like underwear, which is less economically sensitive than other categories.

However, even with these strategies, it's unclear whether these department stores will be able to fully recover their pre-pandemic customer traffic. The article suggests that the best long-term strategy for these retailers might be to focus on their core business, as consumers' attitudes towards certain categories like apparel have shifted.

How US department stores are getting shoppers back 

What: Kering acquires a brand and production capabilities by purchasing Creed.

Why it is important:  Niche perfumes and independent brands have allowed department stores to perform well in a pillar category, but, here too, they should expect consolidation.

French luxury group Kering is purchasing Anglo-French perfume house Creed for an estimated EUR 1bn - EUR 2bn. The ultra-luxury fragrance market, which Creed is part of, is growing three times faster than the overall fragrance market and is worth EUR 5bn.

Creed, which generated over EUR 250mn in revenue in the year to March, is likely to have secured a high price from Kering.

This purchase comes after Kering's decision to create an in-house division for its cosmetics and perfumes, improving control over crucial brands. While the acquisition can potentially accelerate the development of Kering's beauty division, concerns exist about it distracting from addressing underperformance in Gucci and using funds that could be allocated for more impactful deals.

Kering purchases Creed niche perfumes 

What: As excepted, the court has opened the self-administration proceedings of Peek & Cloppenburg KG which allows management to remain authorized to act and issue instructions.

Why it is important: The self-administration proceedings are a move to position Peek & Cloppenburg KG for the future and adapt it to changing markets.

Peek & Cloppenburg KG's self-administration proceedings have been opened by the district court in Düsseldorf.

The restructuring, which includes reductions of 350 administrative jobs, can now go ahead as the company aims to prepare a detailed restructuring plan and strike an agreement with creditors.

The insolvency money period has ended and the firm's pay schedule can now return to normal.

Discussions on the plan with equity providers and debt are expected to begin in the summer.

District court of Düsseldorf gives P&C the go-ahead for self-administration

What: Shein is expanding its multi-category offer and is planning the launch of an integrated marketplace in Europe.

Why it is important: That marketplace has already launched in the US and Brazil, and the company said it will be coming to Europe and the UK this autumn. Marketplaces have become must-haves for online retailers in recent years, and it's no surprise that the company is diving deep into this area.

It said that “through strategic collaborations with renowned global brands and trusted third-party sellers, trend-lovers will now have access to a wider range of product categories”.

New categories include a big focus on products for the home from ingenious portable washing machines to smart home products such as remote-controlled lighting, as well as bathroom and kitchen fixtures and wallpaper.

Shein will launch Europe marketplace

What: Taiwanese department store has optimistic outlook for 2023.

Why it is important:  Never underestimate customers’ appetite for retail in troubled times.

Shin Kong Mitsukoshi Department Store, a Taiwanese department store chain, aims to grow its business by 20% annually during the mid-year sales season as in-person shopping regains popularity. The company has already seen a 15% year-on-year increase in sales in the first five months of the year.

To attract customers, the store plans to offer more bonus points that can be used for goods and services, expecting customers to convert about 180,000 bonus points and enjoy up to 40% discounts.

The store has observed increased demand for golfing, yoga, and camping gear among Taiwanese shoppers, while Southeast Asian customers show interest in cosmetic products.

Shin Kong Miotsukoshi aims for 20% growth 

What: Falabella Retail launched the "Mentoring & Talent" program, in partnership with the consultancy Desarrolla Más.

Why it is important: The project has the participation of 30 employees from Chile, Peru and Colombia with the aim of promoting the development of company professionals in the region.

The program works to pair mentors with apprentices, in which mentors will assist apprentices in their learning processes, and share their experiences and knowledge.

It also includes workshops and learning capsules with the goal of improving leadership skills and competencies and culture within Falabella.

Falabella Retail points out that this new program expects to see positive changes in a period of 1 to 2 years through different performance evaluations.

Falabella Retail starts its new program called Mentoring & Talent 

What: Saks’ quarterly online survey of luxury customers’ attitudes revealed that luxury consumers are looking to save more, travel more, and spend less on luxury goods.

Why it is important: The results of the survey confirm a slowdown in the US luxury market as concerns begin to rise over the economy.

Luxury consumers are prioritizing saving and travel over spending on luxury goods, according to Saks Luxury Pulse's latest quarterly survey.

While 53% of respondents plan to spend the same or on luxury in the next three months, 47% say they will spend less.

Saks reports that 67% of respondents are optimistic about their personal financial situation.

Over half of those planning to spend less said they would be enticed by a sale or promotional event, while 82% plan to prioritize saving over the next three months.

In response to the results, Saks is taking steps to ensure that its best positioned to navigate the rest of the year. This includes optimizing its content and interactions with customers and also emphasizing its live commerce platform, Saks Live, to drive customer engagement.

Spending on luxury goods decelerating

What: The Belgian chain is doing well, with a profit for the second consecutive year. But Covid-19 repayments are still looming.

Why it is important: The consequences of the European states’ aid during the covid are likely to be felt for a few years again.

Last year, Hema reported a 20% increase in comparable sales, with a net revenue of EUR 1.3 billion. For the second consecutive year, they posted a net profit of EUR 32.9 million, following a takeover and debt restructuring in 2021.

However, they must repay EUR 107 million in deferred taxes and EUR 11.4 million in government support from the Covid period. This repayment, though, indicates that Hema's revenue losses were less than expected.

Hema to reimburse EUR 100m of Covid-related state aid 

What: The brand is extending its rental subscription service to 1,000 users for its second stage of development.

Why it is important: The company is seeing an increase in performance while also reducing environmental impact.

The retailer is testing a new business model centered around use rather than ownership.

Through a monthly package with three formulas costing EUR 25, EUR 50, and EUR 95, consumers can have items whose total value must not exceed a certain amount, EUR 400, EUR 1,000, and EUR 2,000 depending on the subscription.

Customers can rent punctually such as a paddle in the summer or skis in the winter or over time and the entire Decathlon catalog is available, including textiles. Repair costs are the consumer’s responsibility, with breakage and theft insurance included. All items are reconditioned by Decathlon between each use.

During the retailer’s first phase, customers used an average of 24 products and emitted 130 kg of CO2 per person over the year, which is much less than owning all the items and also cheaper as customers paid three to six times less than if they had bought the products.

The co-director of We Play Circular encourages all retailers to test out rental services as they want to find the right solutions and continue to see success. He also noted that subscription income is almost only gross margin.

Rental: how Decathlon is moving up a gear in Belgium

What: Shinsegae still sees opportunities for new real estate programs in Korea.

Why it is important: The Korean market is already very developed and the country has embraced new technologies, including Metaverse, far beyond other ones in the region, however there is still space for a new mall.

Shinsegae Group, a South Korean retail giant, plans to build an integrated Starfield shopping complex in Incheon by 2027. The complex will span 1.65 million square meters and include a multi-purpose dome for sports and cultural events, a hotel, and an infinity pool.

Shinsegae expects the complex to attract over 25 million visitors annually and generate US$2.8 billion in economic value. The dome will also serve as the home stadium for the South Korean baseball team SSG Landers starting in 2028.

Shinsegae to build a new mall in Incheon by 2027 

What: Walmart expands its HIV program, launched in 2021, to 80 stores nationwide.

Why it is important: US retailers increasingly pre-empt every single aspect of consumer health, killing two birds with one stone: bring a useful service to customers in need, and contribute to the overall image of the retailer.

Walmart has launched an HIV specialty-pharmacy pilot program in late 2021, targeting communities with high incidences of HIV. The program, which is set to expand to over 80 HIV-specialty facilities across nearly a dozen states by the end of this year, offers specialized training for pharmacists on HIV conditions and treatments.

The initiative aims to make antiviral medications more widely available and provide support services, in line with the Department of Health and Human Services’ goal to end the HIV epidemic by 2030. Walmart, along with CVS Health and Walgreens, is also working to offer free HIV testing and facilitate free home delivery of HIV medications.

The move comes as major pharmacies aim to expand their healthcare services and establish themselves as community retail health providers.

Walmart plans to expand its specialty HIV outreach 

What: Kohl’s is planning to have 750-square-foot Sephora shops operating at 50 Kohl’s locations which would otherwise be too small to accommodate the typical shop-in-shops.

Why it is important: The US retailer continues to install Sephora shops across its stores as a key element in its turnaround efforts.

The small-format Sephora shops will merchandise products by category such as “best of foundation or best of fragrance” to create a simplified shopping experience and make it easier to find popular products.

By the end of the year, Kohl’s plans to have a Sephora presence in more than 900 of its stores and is on track to have a Sephora presence in all 1,100 of its stores by 2025.

Customising the Sephora shops to fit into additional Kohl’s locations demonstrates the retailer’s confidence in its Sephora strategy and how critical it is to its turnaround efforts.

The partnership continues to outperform expectations and allows Kohl’s to provide a prestige beauty experience, which further advances the customer experience.

Total beauty sales were up 150% year-over-year in the first quarter of this year and the company continues to gain market share in beauty.

Despite the increases in beauty, the company’s overall sales decreased by 3.3% to USD 3.36 billion and comparable sales decreased 4.3% with net income remaining flat at USD 14 million.

At smaller stores, Kohl’s will open scaled-down Sephora shops

What: Fashion brands are embracing events to generate brand awareness and drive sales as digital advertising costs increase.

Why it is important: Events are a great way to increase foot traffic and drive sales as consumers crave connection post-pandemic.

While events can be costly, brands don’t always expect to close a transaction but rather intend to be top of mind and remind customers that the store is nearby by creating positive associations with the brand.

Marketers say that in-person events such as trunk shows or shopping parties are more important than ever as social media has become a less favorable channel for advertising in recent years. The events are a direct way to reach customers and leave an impression that an ad on social media couldn’t.

Consumers also crave social activities post-pandemic and are eager to for connection, they want to see people and feel special.

The largest and most costly events often result in the least tangible returns, with the ultimate goal being to provide customers with a positive experience with the brand rather than converting a sale.

Events such as Krewe’s crawfish boil can ignite curiosity and allow customers to feel products in real life and become educated on the brand.

Smaller events such as trunk shows or in-store shopping events provide more opportunities to directly drive sales. Marie Oliver, a women’s apparel brand, has seen an overall sales increase and boost in social media engagement following their trunk shows.

Global head of luxury at Boston Consulting Group stated the most successful events tend to be those that bring together an interesting community of people as allowing customers to come together, especially if the founder is present works really well.

Shopping events are back. Here’s how to make the most of them

What: Macy's has lowered its projections for business in 2023 due to falling profits and revenues in the first quarter.

Why it is important: The retailer saw weaker than expected sales as its consumers are under pressure and spending closer to need.

The company experienced a 7% decrease in net sales and 7.2% decrease in comparable sales while the namesake department store saw a 7.9% decrease.

Bloomingdale's suffered a 4.3% decrease in comparable sales, while Bluemercury saw a 4.3% rise.

One of the main factors cited for the lack of business was failure to offer enough products suitable for colder weather.

Macy's plans to offer more aggressive discounts in Q2. The company is also positive about greater investment in private labels and five growth vectors including personalized shopping experiences, digital strategy, luxury, and smaller formats.

Following these results, Macy’s has lowered its projections for the year, expecting sales to reach USD 22.8 billion to USD 23.2 billion in comparison to its previous expectation of USD 23.7 billion to 24.2 billion.

Macy’s Inc. reports tough first quarter 2023 results

What: The luxury jeweller is the first in the industry to receive approval from the Science Based Targets initiative (SBTi) for its net-zero emissions target.

Why it is important: Tiffany & Co.’s goals are in line with the latest climate science and the need to limit global warming to 1.5°C.

SBTi has verified Tiffany’s long-term target of achieving net-zero greenhouse gas emissions across its operations (Scope 1 and 2) and supply chain (Scope 3) by 2040. The jeweller has also received approval for its 2030 near-term greenhouse gas reduction target.

Tiffany & Co. aims to reduce Scope 1 and 2 emissions by 70% and reduce Scope 3 emissions by 40% against a 2019 baseline.

The company has already made progress towards its goals, reducing emissions by 30% in 2022.

To reach a 90% reduction, the retailer plans to engage and decarbonise its entire value chain, focusing on deep and rapid emission cuts guided by climate science and industry best practices.

Additionally, the new NYC flagship store is on track to receive WELL Platinum certification and LEED Gold certification.

At five locations, Tiffany has on-site solar installations, and the company plans to expand its investment this year by installing solar panels at its diamond polishing facility and jewellery manufacturing site.

The jeweller currently sources 91% of its global electricity from clean, renewable sources, including on-site solar and renewable electricity credits, in over 25 countries.

Tiffany & Co. becomes first luxury jeweler to receive net-zero target approval

What: Bergdorf Goodman is revamping its luxury men’s only store to feature new boutiques, a VIP dressing area, and a food and beverage service.

Why it is important: The updates are being made to address the changing needs of customers, which includes the demand for occasion-based clothing.

Most of the changes will be taking place on the second floor, which features tailored clothing, furnishings, and luxury sportswear.

Some of the key changes include Charvet moving to a new boutique, a shop for Cesare Attolini, and the addition of Brunello Cucinelli’s Satoria Solomeo line which will be the only distribution point in the US outside the company’s own boutique.

A VIP dressing area has also been added that will offer a food and beverage service from Goodman’s bar, alterations, and a lounge.

The new additions complement the existing assortment which includes shops for Brioni, Tom Ford, Giorgio Armani, Ralph Lauren Purple Label, and Ermenegildo Zegna among others.

Bergdorf’s has seen a significant increase in sales of more tailored pieces and furnishings, with occasion-based clothing continuing to be very strong for events and celebrations in the post-pandemic world. Additionally, the store has seen growth in luxury sportswear as well as a resurgence in neckwear./nbsp]

More renovations are planned for the store in the future as the luxury retailer is seeing a strong response to its men’s business.

Bergdorf’s revamps second floor of its men’s store 

What: The US private equity-back Authentic Brands Group (ABG) has acquired British heritage brand Hunter.

Why it is important: Brands are increasingly concentrated within conglomerates looking for scale, including when at the negotiation table with department stores

The acquisition drives ABG’s strategy of diversifying its portfolio with brands that originate outside the US and comes as part of the firm’s brand-building approach.

The deal was supported by Authentic's existing partners, Batra Group and Marc Fisher Footwear, who will be fully responsible Hunter's retail operations and its future expansion on both sides of the Atlantic.

The Batra Group will be responsible for designing and developing Hunter footwear, apparel and accessories in the UK and Continental Europe.

Meanwhile, in the US, Marc Fisher Footwear will become the brand's core footwear partner, focusing on the footwear design, wholesale and e-commerce operations.

The move adds to ABG’s growing portfolio of brands, as it acquired Ted Baker, Reebok, David Beckham's DB Ventures and Vince last year.

Authentic Brands Group acquires Hunter Boots

What: The Parisian department store has been turned into a carnival to pay tribute to its founder who built the first-ever amusement park in Paris, Magic City

Why it is important: The department store is paying tribute to its past, while also creating an interactive and unique store experience for its customers.

A multitude of activities and colorful stands can be found throughout the many floors of the store such as Magnetic Tweezers and The Acquatic Ballet, pinball machines, and arcade terminals.

Snapchat is providing augmented reality experiences while artist Pierre Brault is exhibiting his work which is representative of the Samaritaine woman.

The Musée des Arts Forains also unveiled an exhibition which features historical elements fo the funfair, wooden horses and other iconic animations.

Free reign was given to 3D artist Clément Morin, the motion designer who designed both digital and animated works to be displayed on the exterior of the store as well as around the store’s grand staircase.

La Samaritaine dons the colors of Magic City 

What: M&S has unveiled a new Beauty Takeback Scheme where empty product packaging can be dropped at 40 stores across the UK.

Why it is important: The initiative is estimated to collect over two tons of empty beauty packaging within the first year.

Formed in partnership with the recycling firm Handle, the new program will allow customers to return any form of plastic or aluminum beauty packaging from any retailer.

Dedicated boxes will be located in Marks & Spencer beauty departments and the materials and components will be used to create new packaging and products.

The initiative targets the parts of packaging that are often missed and aims to create a simple solution for customers to live lower carbon lives.

Marks & Spencer launches beauty recycling program

What: John Lewis Partnership chairman, Sharon White, has pledged to get the retailer back to sustainable profit before 2026.

Why it is important: The department store retailer has posted three years of losses but is confident in its five-year recovery plan to get the partnership back to profit.

The retailer’s recovery plan aims to create a broadly based business with brilliant retail at the core, built on excellent customer service, quality, and ethics.

White stated that the retailer’s famous annual bonus would be paid when affordable. The bonus was scrapped last year amid losses of GBP 234 million.

While the plan could require external investment, White assured that its employee model wouldn’t be going anywhere.

John Lewis chair promises profits before 2026

What: Saks is partnering with resort operators to establish Five Avenue Clubs’ personal service and styling suites in locations where it doesn’t have stores.

Why it is important: The new initiative is a way for the retailer to deliver personal service to a wider audience and reach customers in locations where it doesn’t operate stores.

Saks Fifth Avenue is bringing its Fifth Avenue Club personal shopping and styling service to luxury resorts across America, with plans to open 10 locations in 2023.

So far, three Fifth Avenue Club suites in resorts are open in Hawaii and two locations in California. Additional Fifth Avenue Club suites are expected to open at luxury properties in Maui, Nashville, Orlando, Charleston, Deer Valley, Nantucket and Santa Fe.

The company is leasing suites in the resorts for a minimum of one year to test locations and understand the value of the market. Small local teams who are well connected in their communities have been recruited for the suites in the resorts.

Saks' lead partner in the strategy is Marriott International and its portfolio of luxury brands, but other partners have been brought on board as well.

Clients will make an appointment and consultations will be done remotely to determine the client's needs. Then the suite gets curated for the client by the time of arrival at the resort.

Saks extends its brand of personal service to luxury resorts

What: The beauty retailer’s chief merchandising officer shares her thoughts on how the beauty industry will increasingly prioritize mixing products and services that emphasize wellness into daily routines.

Why it is important: The beauty category continues to outpace the global economic outlook and there is no greater growth vehicle within the category than wellness.

Beauty and wellness have become synonymous as consumers increasingly focus on feeling good and taking better care of themselves, a trend that developed during the pandemic.

The trend started in skin care, evolved to hair, and is now more focused on makeup as customers are going out and attending more events post-pandemic.

Ulta launched a wellness shop in 2021 with the aim of creating something that crossed categories and made it easier for customers to shop.

The retailer began with a more everyday basic care range before adding five pillars to its offering, including relax and renew, which became more popular during the pandemic and intimate wellness which launched at the end of Q3 in 2022.

Arnaudo states that having a global perspective and taking a holistic view is important as 41% of people globally believe that wellness is a communal and societal issue than an individual goal.

Ulta has seen the luxury segment continue to grow, attributed to the influx of social media as more than 80% of Gen Z and Millennials will purchase a luxury beauty product if they see it on TikTok.

Wellness will continue to be a growth driver for the retailer which they attribute to the more than 150 wellness brands in their assortment.

Ulta Beauty’s merchandising chief looks inside a big bet on wellness

What: Designer Brands (US) announced that Nike was resuming business relationship with them.

Why it is important:  In a spectacular fashion, Nike is reversing some of its decisions related to stop some wholesale partnerships, which were initially cancelled to leave room for Nike’s DTC strategy.

Nike is reestablishing partnerships with some retailers to help clear its inventory, reversing a previous strategy to sell more products directly to consumers.

Designer Brands recently announced that Nike products would return to its stores in October.

Nike had previously dropped about 30% of its wholesale accounts, including Zappos, Macy's, Designer Brands, and Urban Outfitters, to focus on direct sales and strategic partners. However, increased inventory levels and changing market dynamics have led Nike to reengage with these retailers.

Despite this shift, Nike's wholesale revenue increased by 10% in the nine months through February compared to the same period last year.

Nike is trying to win independent retailers back