What: Iconic department store goes on market for GBP 4 billion.

Why is it important: No formal bid has yet been tabled but a small number of parties have already expressed potential interest with sovereign wealth funds of Abu Dhabi, Saudi Arabia and Qatar all named possible bidders alongside Hong Kong’s Lane Crawford.

The Weston family has launched a formal auction to sell the historic department store business. The process could be completed by the end of the year. It was first reported last month that the retail business could be sold after an unnamed bidder approached the Westons, who own a majority stake in Primark owner Associated British Foods, with a move to buy Selfridges.

Selfridges is for sale

What:  A reflection on the key actions taken during the pandemic to help the company strive

Why it is important:  In addition to omnichannel improvement based on the physical stores network, the CEO mentioned key partnerships with Amazon and Sephora (in a similar manner to what Manor does with FNAC and Decathlon), as well as a strong audit of the product and brands portfolio, leading to a more focus assortment.

Michelle Gass, CEO of Kohl’s, was interviewed during the NRF Retail Converge event (see our report here) and provided some insights on her way to deal with the pandemic and the key lessons:

• A careful audit of the department store’s brand portfolio to make sure its offer was at the same time coherent, adequate to customers’ needs and efficient (leading to a reduction of 20% of the assortment between 2019 and 2021, including the discard of 25 private labels),
• Capitalize on the real estate portfolio and variety of formats to provide omnichannel services (BOPIS, kerb side pick up, ability to accept returns from Amazon products),
• Partnerships with specialist retailers such as Sephora, which will expand to 850 stores within 2023. The target is to send a message to other specialist retailers and be attractive thanks to its physical stores footprint, as well as its digital capabilities.

Kohl’s CEO Brand Partnerships, Omni Services Position the Department Store for Future Success

What: Called “Retail Flex”, Apple plans to test a hybrid in-store and work-from-home arrangement during 6 months for a small number of retail employees.

Why is it important: From home, workers will handle online sales, customer service and technical support, moving between their store and remote roles depending on demand in stores versus online shopping during a particular period. In the wake of labour shortage, could the initiative also represent a way to attract and retain retail staff?

Creating such a program is an acknowledgment that the trend of greater online shopping accelerated by Covid-19 may continue despite economic re-openings and vaccine availability. This comes after Apple announced return-to-office plans for corporate employees. Apple has asked all non-retail staff beginning in September to work from the office on Mondays, Tuesdays and Thursdays, while office attendance is optional on Wednesdays and Fridays.

Apple will reimburse for some internet expenses and USD 100 toward office equipment. They will also retain the same salary regardless of whether they work at home or at the stores.

Apple to Test Hybrid Work From Store and Home for Retail Staff 

What: Sales dipped 2.9% to GBP 222 million in the 12 months to March 30, 2020, just as the COVID-19 pandemic began taking its toll on business.

Why is it important: Due to substantial investments in e-commerce and online operations, the retailer’s EBITDA was down 48% to GBP 7.2 million pounds in the period.

The consolidated results pertain to all Harvey Nichols stores in the U.K. and the Republic of Ireland, including the Knightsbridge flagship. The results also include franchise income from the group’s six international stores in Dubai, Riyadh, Kuwait, Doha and Hong Kong, which operate under license.

The group described the 12 months to March 2020 as a “challenging year” due to a variety of factors. Although Harvey Nichols was forced shut in the final weeks of its financial year, the temporary closures, and a lack of international tourists, still took a bite out of sales.

During the 2019-20 fiscal year the company invested further in its IT infrastructure and CRM program, and introduced a Fragrance Room to the Knightsbridge flagship. Harvey Nichols said it would continue to invest in its online channels and stores to ensure that it can drive profitable growth going forward.

In fiscal 2019-20, online sales grew 33% compared with the previous year, and the trend has continued into fiscal 2020-21. Harvey Nichols said online sales grew a further 69% in the 12 months to March 2021.

Harvey Nichols Emerges From Tough Year of COVID-19 Damage, Investment

What: Ahead of the Olympics, Tokyo enters its fourth pandemic-related state of emergency.

Why is it important: As borders are closed, department stores Matsuya and Isetan are developing omnichannel strategies to engage with local customers and try to benefit from the Olympics anyway.

The government is asking that department stores, bars and restaurants close by 8 p.m. and do not serve alcohol. With the country’s borders now closed, department stores are getting creative with how they appeal to domestic customers.

Matsuya Ginza has started online customer service, not only sales, but also showing what is going on in the store. Efforts are put in e-commerce and delivery services for cosmetics and food by taxi and bike. For the overseas customers, the retailer does live commerce through WeChat. Matsuya do not do direct Olympic-related campaigns, but will offer special events relating to Japanese culture such as Pokémon events. They will also sell sets of food and drink for the people watching the Olympic Games at home.

Isetan Mitsukoshi is taking similar measures. In November the company launched a remote shopping app designed to provide customers with an in-store shopping experience online. The app includes a chat feature, the ability to consult with sales staff via video, and even a payment platform. They are also publishing content that addresses customers’ interests: for instance, buyers introduce curated product selections. For its fiscal year that ran from April 2019 through March 2020, Isetan Mitsukoshi’s online sales were around JPY 20 billion. For the following year, they grew to JPY 31.5 billion.

Japan’s Retailers Brace for Spectator-free Olympics 

What: Vogue Business sat down with the new EVP leading the investment.

Why is it important: The American retailer is hoping that personalisation, faster delivery and tech-enabled stores will enhance its value to customers.

Neiman Marcus plans to spend the sum during the next three years on new tech, updating its stores and speeding up deliveries. Bob Kupbens, Neiman Marcus Group’s new EVP and chief product and technology officer is leading the investment. He will be working with the e-commerce team, the “Connect” app and the innovation team.

Technology to improve personal relationships with customers is key, making services such as recommendations, one-to-one communications and store visits better, faster and more scalable. Crucially, it’s the top clientele who are set to benefit. The goal is what the company calls “integrated luxury retail”, which translates to personalised services for a small subset of customers, says Kupbens; 40% of the retailer’s business is from customers spending more than USD 10,000 a year, and about 35% of the group’s revenues comes from the retailer’s credit card holders.

In June, NMG announced it was acquiring Stylyze, a software company that uses machine learning to make outfit recommendations based on what customers have looked at or purchased. Neiman Marcus has worked with the company since 2018, and integrated it into NM Connect, the proprietary tool introduced two years ago that associates use to communicate with customers. That’s a huge competitive advantage as customers don't want to wade through thousands of products, they want more curated selections. Two months after the technology was rolled out to nearly 5,000 associates, it resulted in USD 60 million in incremental sales.

Stylyze uses machine learning to understand products and then find similar or coordinating items. It helps associates scale their capabilities to make product and outfit recommendations. This technology has the potential to be combined with proprietary customer data, such as location, shopping habits or preferred brands, to generate personalised experiences and offers. Even in store, an associate could use the software to fill a dressing room with client favourites, or make coordinating recommendations. The group currently uses Stylyze’s technology in remote and digital selling, but plans to integrate it into e-commerce, mobile apps and one-to-one messaging channels like text and chat. Stylyze is a first of “several future investments”, according to the company.

Kupbens rejects the notion of tech for tech’s sake. “There are a lot of really gimmicky things that I just reject — like I don't want a bunch of screens in a store for the purpose of having screens. I don't want facial recognition. I'm very much in the service of the customer experience, and whatever is going to make that seamless.” Going forward, he may offer the ability to log into an app in store to access extra information or experiences that require identifying the customer, similar to the types of perks found online.

Inside Neiman Marcus’s $500 million tech investment 

What: Google expands on its commerce business, including a new YouTube live shopping beta.

Why is it important: YouTube, which boasts that its massive userbase of more than 2 billion people accounts for nearly a third of the internet, is poised to be Google’s best weapon in the battle to dominate social or video commerce.

Google revealed new retail efforts, including a beta program for YouTube livestream shopping and updates to help retailers reach deal-hunting shoppers. So if you’re watching a supported livestream on YouTube, you can now browse and shop products in real time, without interruption.

The news arrives at a pivotal moment for social commerce, as Facebook, Instagram, Snapchat, Pinterest, TikTok and more have been looking to dive deeper into online shopping trends, including live shopping, augmented reality try-ons, shopping with friends and other initiatives.

Social media companies see a cash cow in social media shopping, though it doesn’t come without risks — namely, undercutting the appeal of the very influencers who power these platforms, their popularity and their commerce bids. In essence, if all they become are product pushers, it’s hard to imagine fans will continue to follow, like and subscribe at the same levels./nbsp]

YouTube also revealed a new monetization tool this week. Now available broadly as a beta feature, Super Thanks allows fans to applaud — read: tip — to show appreciation for single uploaded videos, ranging from USD 2 to USD 50.

Google also revealed new search and Google Shopping updates targeting bargain shoppers and amplifying seasonal promotions. For instance, companies can set public promotions so that they only apply to first-time customers, as well as distinguish specific deals for indexing via organic traffic, which is free, versus paid listings.

Google Reveals Commerce-Related Updates

What: Edmond Mesrobian, Nordstrom’s chief technology officer and chief information officer participated in VentureBeat’s Transform 2021 virtual conference.

Why is it important: As customer service is Nordstrom’s bedrock, Mesrobian shared how the department store revamped its data infrastructure in ways designed to enhance customer experience.

Nordstrom Analytical Platform (NAP) is a real-time, event streaming–centric analytical platform that provides insights on everything from customer services to credit. Reflecting on the start of this project, Mesrobian said that the most important thing is to remember that presenting the information is not about reporting data, but about collecting events that can be translated into actions.

Nordstrom starts by getting the business events created, organized, and streamed in real time. Then the multi-layered analytical models translate the events into predictions that lead to customer benefits and services. NAP employs open source technology and cloud computing, stitching existing components together to create an analytical platform that drives machine learning in a robust way.

“We want to transfer the responsibility from the data engineers in the past … to the application owners to make sure that their business events were pure, curated, and correct to begin with, and [they are] also aligned with their business goals,” Mesrobian explained. The shift in responsibility, he said, is key to the platform architecture process.

Nordstrom collects user preference information and employs it to provide better selection, better dynamic looks, better style boards, better choices, and so on. Through AI, the company presented a more robust way of driving discovery and personalization. Nordstrom also launched a fashion map effort to take a natural language-based approach with deep learning so that the model gets to know customers better through conversation, as opposed to keyword searches.

When building an analytical platform, Mesrobian pointed out that it is important to keep in mind that data is not the crucial aspect: so the platform actually has to make predictions rather than presenting raw information. An important point is also to make sure that the systems are wired from the store with privacy and security in mind, so that the analytics take into account both the business event and the privacy impact of customers.

Nordstrom CTO on AI-powered analytics and consumer insights 

What: Hammerson suspends granting rent concessions to tenants as activity picks up

Why it is important:  Cooperation with tenants has been the norm so far, however now that the economy is getting back to a semi-normal, business is back.

UK-based Hammerson has announced that it would stop granting rent concessions to tenants, now that activity picks up and that the UK government extends a ban on evictions until March 22.

Rent collection has improved, according to Hammerson, to 89% for 2020, and currently at 68% for first half of 2021.

Now that business is picking up, operators do not see the need to extend the support that has been the norm during the pandemic.

Mall Operator Hammerson Plans To Stop Giving Rent Concessions 

What: Marks & Spencer unveils its new Café concept in Birmingham

Why it is important: This is part of a bigger ambition to make Marks & Spencer seen as a destination for families again.

Marks & Spencer has launched a “test and learn renewal concept” in its new store near Birmingham, in Solihull Sears retail park. The atmosphere has been redesigned to create a warm and inviting space for shoppers, with a seamless ordering process.

The new café concept, the first of its kind, is implemented in the 16th iteration of the new  Marks & Spencer store concept. It aims at making Marks & Spencer a destination for families again.

Marks & Spencer unveils new look M&S Café Retail Bulletin

What: One of the most significant real estate owner in the UK reported its 2020 results

Why it is important:  In spite of having suffered a net profit decrease of -21.9%  in 2020 compared to 2019, recovery is not yet in sight and things might get worse in terms of retail occupancy.

Retail landlords such as The Crown Estate (a significant player  owning top notch properties in the centre of London) are expecting the crisis to get worse, even though the number of empty location has already doubled since the start of the pandemic, and difficulties to retrieve rents (cash collection is at 81%).The Crown Estate saw its net revenue profit decrease by GBP 75.7m in 2020 compared to 2019, to GBP 269.3m (-21.9%).

London has been particularly hit, with Regent Street footfall down -75% compared to the previous year, for instance, leading to a decrease of the London portfolio value from GBP 8.4 bn to 7.7b, with 8.2% unoccupancy rate (from 4.7% pre-pandemic).

The Crown Estate CEO mentioned to Bloomberg that they expected the situation to worsen even further, leading him to start considering sales and conversion projects.

London Retail Situation The Crown Estate announces £269.3 million net revenue profit for 2020-2021

What: Target, Walmart, Bed, Bath & Beyond, Macy’s and Kohl’s are among the top American retails offering big discounts and promotions to compete with Amazon Prime day held 21 and 22 June.

Why is it important: Prime Day is expected to top USD 11 billion in total online spend for US retailers, surpassing sales generated on Black Friday and Cyber Monday last year.

Amazon Prime day, which generated USD 10.4 billion in gross merchandise sales last year, is taking place earlier than its traditional July run date, as the e-commerce giant looks to boost spending in what are historically slow sales days in the quarter. Twenty countries participate in the event this year.

Big US Retailers Line up Deals To Challenge Amazon Prime Day

What: Products are recycled from used clothes that were collected by the department store

Why it is important: A factory breaks apart the fabric so that new clothing can be made from the recycled materials. The overall goal is to achieve closed loops in the fashion sector by adding more sustainable clothing as an offering.

Department store giant launches sustainable clothing

What: The French department store will broadcast four 20-minute programmes from its Boulevard Haussmann flagship store via its website and on social media.

Why is it important: While livestream shopping has been slow to catch on in Europe, Galeries Lafayette launched its distant shopping service in November 2020 and Breuninger debuted live shopping sessions in March.

The first show will launch on June 23, followed by shows on July 7, 21 and 28. Each of Printemps’ livestream events will showcase a selection of fashion, beauty and lifestyle pieces. Shoppers will be able to ask questions directly to the hosting personal shopper through a chat function.

Printemps Debuts Livestream Shopping 

The department stores will host, in partnership with Pierre Bergé & Associés, its first auction of vintage furniture. The event comes as a part of the "OFF" programme (launched in January 2020), consisting in exclusive cultural events. The 120 objects and pieces of furniture will first be displayed as an exhibition in the homeware section of the store, and then auctioned in the Grande Epicerie de Paris restaurant (which is closed due to Covid restrictions).

Le Bon Marché Rive Gauche hosts its first auction of decorative arts furniture 

What: Uniqlo opens store in Tokyo’s historic Asakusa district.

Why is it important: The concept highlights and includes other local businesses.

Uniqlo opened the doors of its newest large-format store in the culturally significant neighbourhood of Asakusa. The store follows the concept of “our neighbourhood” and aims to support the area’s local businesses, residents and artisans. Asakusa’s district hosts the workshops and stores of many traditional craftspeople, some of whom Uniqlo featured in various ways inside the store.

The entrance to the store is dominated by a giant paper and wooden lantern, which was created by a local workshop. Uniqlo also collaborated with local businesses: small ceramic plates designed with traditional snack-maker Asakusa Tokiwado will be available for sale, original tea cups will be given to the first 3,000 customers to spend 5,000 yen or more. There are also original UTme! stamps that are only available at the Asakusa store to use in customizing T-shirts and tote bags.

Throughout the store, Uniqlo has highlighted products from local shops, from stationery to skateboards, encouraging customers to explore the neighbourhood in order to purchase such items and discover others.

Uniqlo Opens Store in Tokyo’s Historic Asakusa District 

What: With sales increasing, the retailer plans to invest USD 500 million to build a digital ecosystem.

Why is it important: Neiman Marcus is developing its omnichannel strategy, both betting on stores and e-commerce.

Neiman Marcus no longer reports public financial results but its CEO provided figures to The Wall Street Journal and WWD showing comparable sales for the February-April period rose 43.8% compared with the same period last year. Compared with 2019, sales were down 6.6% and e-commerce sales represented about 35% of total revenue, rising 1.6% from 2019. Also, Neiman’s top 20 luxury brands were up about 35% in the fiscal third quarter compared to the pre-Covid period. Men’s, shoes and handbags were the best categories, while women’s apparel and formal wear have not recovered yet.

The company plans to invest more than USD 500 million over the next three years to refresh stores omnichannel capabilities, speed up its supply chain, expand same-day delivery and improve its digital business. Neiman Marcus’s landlords are kicking in USD 100 million of the planned investments. The investments also include an agreement to acquire Stylyze, a machine learning software operating under SaaS, that curates outfits for customers based on their past purchases and browsing history. The acquisition will allow Neiman Marcus to engage even more with luxury customers, and convert one-time shoppers into lifetime customers, attracting them with automated suggestions.

CEO Geoffroy van Raemdonck said he wants to focus on high-end luxury customers, including the 40% of Neiman Marcus shoppers who spend at least USD 10,000 a year with the chain, while also attracting new customers. The average order size for new customers increased more than 80% in the recent quarter compared with a year ago. Neiman Marcus ended the quarter with inventory down 31% compared with a year ago.

Neiman Marcus Group Accelerates Digital Capabilities with Intended Acquisition of Stylyze (Press Release)

Neiman Marcus Rides a Rebound in Luxury Shoppers - WSJ

Neiman’s Turns Toward Technology With Heightened Investments – WWD

What: Walmart is held responsible by Yeezy of authorizing third parties to sell fake products on its marketplace

Why it is important: For now, there is no obligation in the US for retailers to police what is sold on their marketplace. However, this could be a strong deterrent for both brands and customers, forcing de facto retailers to control their product offering, in order to salvage their reputation and power of attraction.

Yeezy is suing Walmart for selling counterfeit products on its marketplace. However, Walmart is defending itself by mentioning that the products are sold by third-parties on its marketplace, which raises the question of the retailer’s responsibility in terms of responsibility regarding marketplace monitoring.

In 2010, US courts ruled that E-bay did not have the obligation to police counterfeits of Tiffany on its platform. However, since then, the pressure has grown on retailers to set up (voluntarily) programs to confirm the authenticity of products sold in their ecosystems. However, the cost of such programmes can be offsetting, and for now retailers do not have legal obligations to police their products selection. Until when?

Kanye West Walmart

What: Swedish online second-hand shop Sellpy, which is majority-owned by fashion giant H&M is opening in 20 European countries.

Why is it important: The company handles the entire sales process from picking up the goods from sellers’ homes, to photographing, selling and shipping.

The expansion will take its number of markets to 24 after it first launched in 2014 in Sweden. The H&M group, which is on the outlook for additional revenue streams following a few rough years with slowing sales, bought its first stake in Sellpy in 2015.

H&M has invested more than EUR 20 million (USD 24.38 million) in Sellpy and owns around 70% of the company. Sellpy said more than nine million garments had been sold in total on its platform.

H&M Launches Resale Site Sellpy in 20 More Countries 

What:  The IGDS announced a new president for the coming 2 years.

Why it is important:  Reinvention is needed for all of us, including the Department Stores associations themselves. This is what we have been doing at IADS for the last year at an intense pace.

The Intercontinental Group of Department Stores (IGDS) has announced the appointment of André Maeder as the new IGDS President for 2021 – 2023, replacing Simon Susman, Honorary President of Woolworths, who remains IGDS Board Member.

Currently serving as the Kadewe Group CEO, André Maeder has a wide experience in retail and department stores management, having started his career as Chief Retail & Merchandise Officer at Harrods, and having also been the Chief Retail Officer at Karstadt. Maeder also boasts a brand experience as he also worked at S.Oliver and Hugo Boss. He is also a member of the board for Davidoff and Globus department stores.

New IGDS President - IGDS

What:  China is increasing retail space fast in Hainan.

Why it is important: Given that borders are still closed due to Covid-19, it is all about getting a critical mass as fast as possible and create new patterns for Chinese tourists, in order to retain a significant portion of their purchases including when international travels will be authorised again.

Tax-free consumption in Hainan is bolstered by the opening of 3 new stores on the island, one at the international airport and the two other ones in the city of Sanya (where the larger measures 95,000 square meters where 350 brands are present). This leads the province to have a total of 7 duty-free malls, with 4 of them operated by China Duty Free Group. The reason why two new companies are joining the market is reportedly to increase competition and differentiation in the offer.

3 more stores are planned in the coming years, with a total surface combined between the 3 stores just opened and the 3 ones planned of 220,000 square meters.

China's Hainan opens 3 offshore duty free shops 

What:  Westield is divesting in a 4th mall in the US this year, following the plan announced earlier in 2020.

Why it is important:  Large operators are in a situation where rightsizing is not enough anymore. To remain economically viable, they have to divest and focus on profitable part of their assets portfolio.

Unibal-Rodamco-Westfield, owner of the Westfield Broward mall in Florida, is turning over the property to lenders, and operations to a receiver. This move is part of a plan already announced to let go US properties during 2021 and 2022. The group already divested 3 malls, after having suffered a decrease of 44% sales as a whole for its US operations. Unibail seeks to rebalance their real estate portfolio and focus on the most promising ones, instead of reaching a costly critical mass.

Westfield turns over Florida mall to lenders

What: Shopify embraces “Buy Now Pay Later” with Shop Pay Instalments, a custom-made solution powered by Affirm.

Why is it important: Even the smallest business can now offer BNPL solutions to customers.

Affirm built the Shop Pay Instalment solution to be integrated onto Shopify’s Shop Pay platform, which already offers various services to merchants to measure their sales and monitor their operations. It’s also a move by Affirm to gain market share over competitors such as Klarna and Afterpay.

The partnership with Shopify means that hundreds of thousands of additional merchants in the U.S. will provide Affirm’s alternative payment solution to shoppers. Any U.S. merchant newly listing on Shopify is automatically enabled with Shop Pay Instalments.

Affirm officials said that one in four merchants using Shop Pay Instalments during the beta period saw higher sales, some by as much as 50%; that on average, merchants saw 28% fewer abandoned carts and higher transaction values, and that their payment system is faster for consumers since they don’t have to fumble with credit cards.

Affirm hasn’t seen an increase in delinquent payments during the pandemic. The company’s most recent earnings report indicated an approximate 5% allowance to cover estimated delinquencies.

2021 Global Payments Report by Worldpay said buy now, pay later has an under 2% penetration in the U.S. With BNPL solutions on Shopify, the payment option is going mainstream.

Shopify Embraces ‘Buy Now, Pay Later’ 

What: La Samaritaine is carefully crafting its visibility in press to prepare its opening

Why it is important: The reopening of this iconic location has been waited for long, and expectations are extremely high.

Monocle had the opportunity to visit in avant-premiere La Samaritaine to discover what to expect after 16 years of works. Presented as the revival of a neighbourhood rather than a building renovation, the new project includes the first Cheval Blanc hotel into a main capital city, offices, social housing, a nursery, in addition to the department store itself. LVMH likes to present the project not as a new department store, but as a place of discovery, surprises and experience.

The good place