What: The French luxury group reported a 2% rise in sales for Q1, largely falling behind its competitors LVMH and Hermès who saw double-digit increases in revenues.

Why it is important: The group will be focusing on its top-tier clients to help catch up with its competitors as Gucci, its top brand, is in a transitional year.

Sales for the first quarter totaled EUR 5.08 billion, increasing 1% compared to the same quarter in the previous year.

The group’s performance was mixed, as they work to enhance their brands’ appeal and increase their desirability.

At Gucci, organic sales were up 1%, compared to a 14% decrease in the previous three months. As the Italian luxury house is in a transformation phase, the group is elevating the brand through initiatives such as the launch of the Salon in LA and hosting an exhibition in Shanghai with humble ambitions for the year.

Bottega Veneta saw flat comparable sales in Q1 while Saint Laurent’s organic sales increased 8%. At other houses, sales were down 9% compared to a 4% drop in Q4 following the Balenciaga scandal.

The group’s luxury jewelry brands saw double digit growth, with Brioni performing exceptionally well.

Kering eyes ultra-wealthy as results lag peers

What: As traditional brick-and-mortar stores face new challenges and e-commerce continues to grow, retailers are looking for innovative ways to reach consumers and provide engaging shopping experiences.

Why it is important: The metaverse has promised a new frontier for retailers to create virtual storefronts, showcase products, and engage with customers in ways that were previously impossible.

According to industry experts, the metaverse is still developing, as is Web 3.0 technology, and together, it presents an entirely new way of interacting online, with new consumer experiences and a shift toward a democratised and traceable future.

Experts do not believe that there is a rush for retailers to enter the metaverse, but rather there is an urgency to put the tools in place that digitise the in-store experience and allow for interactive, 3D experiences with customers.

Why these experts believe the metaverse is still relevant for retail

What: Bloomingdale’s is searching for a new chief executive officer, but it isn’t an easy position to fill.

Why it is important: Finding someone to run an upscale department store is challenging as the industry is short on talent and leadership.

The department store’s ideal candidate would be someone with a broad background who has experience in department stores, digital and luxury, which is a rare blend.

There’s a small talent pool of highly qualified retail leaders to draw from, raising the possibility that someone from specialty retail or outside the retail industry could be the right fit for the role. Additionally, Macy’s Inc. has confirmed there’s no one inside to fill the position.

According to a source close to Macy’s Inc., the retailer needs someone who has a strong understanding of the omnichannel and upscale contemporary consumer.

A general business manager with operational skills who can expand a business, grow digital, prioritize initiatives and navigate the market in addition to having an appreciation for the brand will be the ideal candidate.

Contemplating a CEO for Bloomingdale’s

What: The technology that exists for brands to offer customers individualized online shopping experiences is expensive and complex, leading to the slow adoption of true personalization.

Why it is important: True personalization offers retailers an opportunity to meet consumers expectations of a personalized shopping experience.

With apps like Tik Tok pushing content that keeps users glued to the app, customers today are more accustomed than ever to personalized content, except when shopping online.

While online retailers use customer data and the latest AI-empowered software to determine their inventory levels, there are few that are taking the next steps to offer individualized product recommendations and search results on their websites.

Only 20% of 100 brands and retailers in a survey said they customize product recommendations based on customer’s purchase history according to research from Manhattan Associates.

Implementing personalization in e-commerce is complicated, resulting in the slow adoption of true personalization. Algorithms that predict customers’ behavior must be built or software platforms can do the heavy lifting, but tech talent can be hard to recruit and AI-driven software platforms are costly.

Even among established brands, there aren’t many who have successfully managed to offer personalization. Retailers must fundamentally understand their customer and where they want to go before personalizing their website.

Collecting customers’ data, using surveys, and seeing how customers interact on the website are great ways to figure out customers’ preferences and make their shopping experience easier and more relevant. Some brands have seen success through offering consultation services with a customized skincare routine or a fit finder that suggests shoes that are the most likely to fit customers’ feet.

Will brands ever get product recommendations right? 

What: The world’s second-largest economy reported 4.5% year-over-year GDP growth in the first quarter and retail sales were up 5.8% compared to the same period last year.

Why it is important: For the first quarter, retail sales of consumer goods total USD 167.17 billion and grew 10.6% for the month of March.

According to the National Bureau of Statistics, China’s economy expanded to USD 413.15 billion, beating analysts’ expectations of an estimated 4% growth. Compared to the fourth quarter, the Chinese economy logged 2.9% growth.

Compared to last year’s first quarter, apparel sales rose 9%, cosmetic sales rose 5.9% and gold, silver, and jewelry sales rose 13.6%. E-commerce sales registered 8.6% growth, accounting for 24.2% of total retail sales.

Service sectors have boomed in Q1, driven by Chinese consumers’ pent-up demand post-reopening.

The second quarter is expected to show significant growth due to a low base from last year’s COVID disruptions, while the third and fourth quarters’ growth rates are expected to be lower due to a higher base from the same period last year.

China GDP grew 4.5% in the first quarter, retail sales up 5.8%

What: Fast fashion goes full speed into circularity as an argument for their sustainable model.

Why it is important: Most department stores are testing second-hand as a way to attract younger crowds, however, the productivity of this model remains to be found in most cases. Fast fashion, which is looking for credibility on its own, is a new threat.

Primark is launching a sustainable 35-piece collection based on the Ellen MacArthur Foundation's ‘Circular Product’ standard, committing to the circular economy and reducing fashion waste.

The collection is designed for longevity and recyclability without increased cost, with prices ranging from 5 to 25 euros. Primark aims to apply these design principles across the business, working with product teams and suppliers to scale up their circular economy efforts.

Primark goes into circularity 

What: The UK department store group will be investing GBP 12.5 million this year, building on the GBP 10.3 million investment it made last year.

Why it is important: M&S has invested nearly GBP 23 million in London over the past two years, with the new stores set to create over 200 new jobs.

A majority of the investment will be going towards boosting food sales, as sales for grab and go items are higher in the city, but non-food upgrades are also in the works.

The investment plan intends to help the retailer reach even more customers across London as a third of its stores are located in the city and its suburbs.

Last year, the renewal of its Kingston full-line store resulted in an 8% increase in Clothing & Home sales. The group also plans to fully renew its Victoria Cardinal Place store and redevelop its Marble Arch store to be in the top 1% of London’s sustainable buildings.

M&S invests millions more in London stores

What: A new report has shown that London’s West End is recovering slowly as it nears closer to a turnover of 10 billion pounds by 2025 with year-to-date sales having gone up 56% compared to 2021.

Why it is important: Department stores were among the most successful trading categories of 2022 and sales are expected to amplify as tax-free shopping returns to the UK, attracting more international visitors.

The 2022 turnover for London’s West End was GBP 8 billion, with health and beauty, electrical goods, and department stores being among the most successful trading categories.

The overall volume of international visitors is expected to have fully recovered to pre-COVID-19 levels by mid-2023 to early 2024. With the restoration of tax-free shopping, experts are optimistic as the Treasury is estimated to benefit GBP 350 million a year, with 1.6 million visitors spending an extra 2.1 billion pounds.

London’s West End on track to 10 billion pounds by 2025

What: Neiman Marcus Group’s new awards program is geared toward benefitting designers and customers to bring greater exclusivity and business to Neiman’s.

Why it is important: The new awards program will be distinguished from others through giving brands greater exposure to customers, strengthening loyalty with existing customers, and giving the group a competitive advantage over other department stores with stronger brand partnerships.

NMG awards signal greater exposure for the honored designers and their brands to the US market and are intended to introduce these brands to new customers while also strengthening loyalty among existing customers.

The luxury retailer’s awards is a 360-degree platform for elevating a designer’s distribution across NMG’s three selling channels and furthering its “retail-tainment” strategy.

The awards are distinguished from others as they have a platform that is backed by its merchandise and marketing engines. Additionally, the awards will allow Neiman’s to strengthen its relationships with designers and have a competitive advantage over other companies.

Additionally, the platform gives brands the space and opportunity to create a significant impact on customers as they tell their stories and express themselves through all of Neiman’s channels. This will involve the retailer’s associates selling to clients remotely and in turn strengthen sales.

The group is able to tap into the power of their sales associates and the relationships they have with clients through the platform as they sell remotely to clients. NMG reports that clients who have relationships with sales associates are spending 12 times more than other customers and customers who shop across channels spend five times more than customers that only shop in one channel.

The strategy behind the NMG awards

What: John Lewis Partnership might not be a partnership anymore in the future.

Why it is important: Times are troubled for the iconic retailer, which is losing ground to Mark’s & Spencer, and which has been unable to pay bonuses to its staff for the past 2 years.

UK retailer John Lewis (John Lewis department stores and Waitrose hypermarkets) is reported to consider a sale of a stake in its business, after 73 years of operating as a staff-owned partnership. The goal would be to sell a stake worth £1 to £2bn, in order to invest in Waitrose and build a performing IT infrastructure, in order to follow up with the massive store opening that took place between 2000 and 2025, from 151 to 379 stores).

However, some experts doubt this version and suggest that this is a recapitalization in disguise, in order to cover the 2022 losses (£234m) which came on top of the 2021 ones (£27m).

Any decision would have to be approved by the chair, the board and the partnership council, a representative body with elected members from the workforce.

John Lewis is reported to consider reviewing its staff ownership structure 

What: Following the announcement of Gennett’s retirement, retail experts are questioning whether Macy’s can be modernized for a better future.

Why it is important: The new CEO faces a big challenge ahead as the department store has recently reported declining financial results and is in a growth desert.

While the department store has become more agile post-pandemic, data-driven, streamlined management, closed 80 weak stores, and improved inventory management under Gennette, Macy’s off-price and specialty stores need to grow as bigger contributors in the business.

Experts have stated that the department store is outdated and needs a new growth engine. While their newer channels like Market by Macy’s are more relevant, some have said that Macy’s fails to execute its strategies well, making the change in leadership an opportunity for new thinking and more enthusiasm.

Macy’s online business was down last quarter in addition to the store business being off and projects a further decline in sales and profits for 2023.

Pondering the future of Macy’s amid leadership changes

What: Amazon Go is permanently closing eight of its Go convenience stores yet will continue to open new stores despite being in a cost-cutting mode recently.

Why it is important: Closing more than a quarter of its Go stores highlights the ongoing challenges the company has faced in building its physical retail footprint.

The retailer’s decision to close several of its convenience stores follows its opening of a new location just weeks ago, in addition to pausing the rollout of its Fresh grocery stores about month ago.

Despite these setbacks in the physical retail segment, Amazon reported a 6% rise in physical store sales during Q4.

Amazon stated that they remain committed to the Go format and will continue to evolve the stores as they learn which locations and features resonate most with customers.

Amazon to close 8 of its Go stores

What: An analysis looks at what’s changed between the two British department stores and where the two retailers have gone right and wrong.

Why it is important: The roles between John Lewis and M&S have reversed as M&S reports higher sales and profits, while JLP reports widening losses.

The department store model has morphed, as retailers move their focus from mono-brand businesses to offering multiple brands that they own, license, or stock on a wholesale basis, Marks & Spencer’s model has an advantage over John Lewis as they have a broader category spread.

John Lewis was an early mover in e-commerce, but as a store-based business, its success online meant physical stores generated less revenue. With this higher percentage of online sales, JLP sees more returns and higher fulfilment costs, while M&S is still enjoying online growth, as online only accounts for a third of sales.

Both department stores have been closing stores, with M&S being more radical and opening new branches. M&S is better positioned to take advantage of the recovery of physical shopping as they open key locations and have a network of 1,487 stores in comparison to JLP’s 34.

John Lewis doesn’t seem to be heavily affected by the cost-of-living crisis, as it launched its Anyday budget line and reports customers shopping across price ranges.  However, grocery plays a bigger role in its overall business and in an inflationary environment, customers are more likely to shop at discount grocers like Aldi and Lidl. M&S reported that its customers are resilient and able to keep spending.

JLP has seen more changes in management recently, with the appointment of a new CEO who comes from a background in food and is known for tough decision making. Marks & Spencer has seen management movements over the past several decades as well, but its big changes have been driven by insiders.

While John Lewis Partnership appears to be struggling, it still remains a key player as a retailer with its total sales reaching GBP 12.25 billion last year, with John Lewis sales reaching GBP 4.94 billion.

Analysis: as John Lewis mulls ownership tweak, why is it lagging rival M&S?

What: The Italian luxury brand will launch two new initiatives, Gucci Continuum and Gucci Preloved as part of its circularity strategy.

Why it is important: Gucci is experimenting with how to maximize its reach, value, and potential for environmental impact with as it experiments with the deadstock market.

Gucci is making the necessary systemic changes to create a circular economy with its current efforts. In addition to these two new programs, the luxury brand has also expanded its agriculture and cultural heritage programs and launched Gucci Hub last month, with hopes to become a resource for other brands to use.

Gucci Continuum is a platform that will showcase products made from Gucci deadstock materials with designs from a series of creative partners. The program is an opportunity for the brand to empower creativity while also giving deadstock materials a new meaning.

The upcycling market is an unproven marketplace, with various ways to give new life to deadstock materials. Gucci wants to experiment with the upcycling model to become more knowledgeable about different upcycling models and as a result, become more intelligent on how they implement waste reduction into their business model.

The resale program, Gucci Preloved, is an extension of the brand’s partnership with Vestaire Collective. The new initiative is more strategic than its previous resale market endeavors, with the hopes of educating customers and curating their own resale space.

The new programs offer further evidence to customers that the brand is building circularity into its business model. Gucci says that its trying to ensure that the impacts of its individual efforts add up to a bigger unified whole, with its circularity efforts having one coordinated strategy that leads to creating circularity and reducing impact.

Gucci launches new deadstock and resale programs as part of bigger circularity efforts

What: Following the abrupt departure of Pippa Wicks, the JLP has chosen a new CEO with great brand experience but little retail background.

Why it is important: John Lewis is expanding into new territories, including housing, and its ability to carry properly this diversification remains to be seen.

John Lewis Partnership, the owner of John Lewis department stores and Waitrose supermarkets, is facing a decline in results and Sharon White, the chairwoman, has appointed a new management team. It includes Nish Kankiwala as the group CEO, with brand experience but little retail pedigree, and five other directors, who will report directly to him.

The company is expected to announce its second full-year loss, with pre-tax losses of over $60m, largely due to poor trading at Waitrose supermarkets (compared with a profit of $219m last year).

Among the upcoming challenges, some new ventures, such as smaller John Lewis outlets and a venture in real estate, launched by Pippa Wicks, the previous CEO, will have to be followed up. This is a big gamble for John Lewis Partnership, which until recently was a department store anchor that every mall wanted, but has now been hit by the cost of living crisis.

Management shuffle at the John Lewis Partnership 

What: John Lewis will be testing new concepts in collaboration with neuroscience experts at one of its stores over the next year.

Why it is important: The department store is taking a unique approach to enrich customer mood and experience.

The concept will be launched across almost half of the two story space in Horsham, West Sussex with plans to be rolled out to three other locations in the spring.

John Lewis hired neuroscience experts to look at the store’s design and prescribe fragrance, colors, and sounds to specific areas.

There will also be a new children’s area with an interactive treasure hunt, activity table, and a nursery advice service.

The partnership is expected to report an annual pre-tax loss before one-offs of about GBP 50 million, compared with a profit of GBP 181 million last year.

John Lewis to trial ‘multi-sensory experience’ across UK stores

What: Latvanen shares his view on how he revived Stockmann after taking over just before the pandemic.

Why it is important: It is all about playing at best all the competitive advantages of department stores, especially their location: they are already where people are.

Jari Latvanen, CEO of Stockmann Group, a Finnish department store that dates back to 1862, reveals how he turned the company's fortunes around. After taking over in 2019, he refocused the company on its roots as a premium retailer, offering customers a "wow" factor and improving customer service, leading to being able to post a €527m profit in 2021.

The company's history has been an asset, allowing Stockmann to offer exclusive experiences and become an attraction.

Latvanen advises other heritage retailers to focus on their unique selling points, listen to customers and employees, and have a razor-sharp focus on strategy. He believes that department stores can succeed by embracing digital opportunities and giving people a reason to visit in person.

Stockmann is set to open a new toy shop, children's department, and trainer bar to focus on circular economy while also expanding its offering for men's fashion.

Stockmann’s CEO Jari Latvanen in Monocle 

What: Retailers are trying to fight against their contribution to environmental damage and emissions, but the major issues lie with indirect partners and peers in manufacturing, logistics, and transport.

Why it is important: According to the National Retail Federation, the major retail body in the US, Scope 3 emissions can account for up to 98 per cent of a retailer’s greenhouse gas emissions, and are far more difficult to manage because, unlike Scope 1 and 2, they are outside of a retailer’s direct control.

Retailers are starting to recognize these issues and are taking steps to fix it within their own business and partners they work with. In order to make a change, retailers are having to evaluate and rethink the business’ relationship with plastics.

Originally, everything was wrapped in plastic to protect goods from being damaged in transit. Some retailers have changed this process to ship goods in large cartons rather than in individual plastic bags. But packaging is a major pain point for customers.

Alternatively, other packaging solutions are offering home-compostable shipping mailers. Alongside the mailers, the company is working towards educating retailers and consumers about composting. Customers are asking for alternatives to plastics, so, therefore, such solutions should not be ignored when innovating the future of supply chain and packaging.

The fight to make the supply chain sustainable

What: According to Antad in Mexico, sales registered a growth of 6.5% in February compared to February 2022.

Why it is important: The report confirms that sales in February reached 227.8 billion pesos, exceeding the 204 billion pesos registered in February 2022.

“Equal stores” with more than a year of operation registered a growth of 6.5% while “total stores” that launched within the last 12 months recorded an increase of 9.4% in comparison to February 2022.

Antad encompasses commercial chains with 47,000 stores across Mexico, including IADS member, El Palacio de Hierro.

The Mexican National Association of Self-Service and Department Stores (Antad) sales continue to rise and exceed growth of 6%

What: KaDaWe Group and Signa Real Estate have begun the conversion of Carsch-Haus and the redesign of Heinrich-Heine-Platz

Why it is important: The upgrading of this central location will create an attractive shopping experience, making the department store a shopping destination for Düsseldorf.

Signa Real Estate will act as landlord of the space, which spans 10,000 square meters and has seven floors.

The completion of the entire project is expected at the end of 2024, with the opening of KaDaWe’s fourth department store in 2025.

The renovation of the historic building considers the wishes of Düsseldorf’s urban community, creating a high quality of stay and giving the central location an important role in the social life of Düsseldorf. With more space being made available through the elimination of a road, pedestrians and cyclists will have more room and people are invited to linger as seating and greenery will also be added.

KaDeWe Group is taking into account the local spirit of Düsseldorf while combining the new and established as well as the luxurious and progressive to offer a variety of brands and services to make the most digital department store in the world at this new location.

Signa Real Estate and KaDaWe Group celebrate groundbreaking in Düsseldorf

What: Hyundai is using AI to save time on their creative processes.

Why it is important: While it is probable that many companies are going to try how they can save time and increase productivity thanks to AI, one can wonder if writing advertising campaigns is the best topic for a first try, unless this goes hand in hand with a massification of the advertising campaigns (hence the media investments) requiring an acceleration in output.

Korean department store company Hyundai has announced that it will start using AI to write its advertising copy in March 2023. The system used has been developed by the major South Korean IT company and is comparable to Open AI’s ChatGPT3.

The retailing company has been training the system, called Lewis, with 10,000 ads from the past 3 years. Thanks to machine learning, the system can come with a proposal for the text of an ad campaign in 3 hours, while it took a few weeks in the past (the final say is still subject to human validation).

It expected that more retailers will embrace the technology in the coming months.

Hyundai department stores are testing AI for their copywriting system

What: NMG’s comparable sales were up 3% for the November through January versus the 2021 holiday season and 11% compared to 2019.

Why it is important: Sales with loyal customers were up 8%, proving that the retailer has customers that continue to buy, remain engaged, and spend more than last year.

Neiman’s saw continued strength in women’s designer ready-to-wear, shoes, handbags, and men’s during the holiday season.

Bergdorf Goodman’s holiday performance also did well, with continued growth online and capturing more shoppers.

NMG was profitable in the last quarter but is seeing a more promotional environment as its full-price is selling but the depth of markdowns is deeper. The retailer expects this to continue in the spring and is being proactive in taking actions during this moment of volatility.

Neiman’s holiday report: sales gain, margins squeeze

What: Macy’s chairman and CEO will retire in February, making the current CEO of Bloomingdale’s, Tony Spring, Macy’s Inc. president and CEO-elect, with a search for the next Bloomingdale’s CEO underway.

Why it is important: Gennette’s retirement has triggered a string of top-level management changes and comes as a surprise as he is younger than the typical retirement age.

Despite Macy’s recent financial results, the CEO is credited for changing the industry’s perception of the retailer for the better and successfully navigating Macy’s through many challenges.

Tony Spring has become Macy’s Inc. president, a role that has been vacant since December 2019. This will make him responsible for the corporation’s digital, customer, merchandising and brand teams, while also overseeing the Bloomingdale’s and Bluemercury divisions and becoming CEO of the group upon Genette’s retirement next February.

Macy’s chief financial officer, Adrian Mitchell, will also be taking on an additional role as chief operating officer, leading store operations, technology, and supply chain teams while continuing his responsibilities with finance and real estate.

Macy’s Jeff Gennette sets retirement date; Tony Spring moving up

What: John Lewis employees are afraid that the minority stake sale might endanger their social model.

Why it is important: Even though the chairwoman strongly defended the model, it is hard to see how it can survive without controlling 100% of its shares.

Dame Sharon White, chair of John Lewis and Waitrose, has pledged to maintain the partnership status of the UK retailer for decades, despite considering selling a minority stake.

The company is grappling with heavy debts and increasing competition from online rivals, but White emphasized that the ownership structure would remain constant. Critics argue that bringing in outside investment could lead to demutualization, but White assured that any radical proposals would be discussed with the company's 74,000 employees first.

Last week, John Lewis reported a pre-tax loss of £234 million, and sales at supermarket Waitrose declined 3%. The company has increased its cost-cutting target to £900 million by 2026.

The John Lewis Partnership ownership model is not at stake according to Chairwoman