What: The Japanese conglomerate is finalizing its closure of overseas operations.

Why it is important: For the Japanese giant, China is no more a priority and the name of the game is to focus on national profitability.

Isetan Mitsukoshi will close its Chengdu Isetan store in December 2022, without plans to relocate the store. This will represent a write-off of USD 3.2m. The store was opened in 2007, followed by a supermarket in 2018. In total, the closed surface will represent 28.000 sqm. It is estimated that sales in the store represented EUR 50m in 2019, and plummeted by 50% in 2021.

The company is retreating from overseas operations, after having closed the Thai subsidiary in 2020 and the Italian one in 2021.

Isetan Mitsukoshi closes Chinese operations 

What: Selfridges transforms their Corner Shop into a well-being destination in-store to focus on curating sex- and sleep-enhancing products and services.

Why it is important: Selfridges’ Corner Shop is transforming into well-being destination called “The Feel Good Bar.” The concept will include products, services, and professionals on standby to advise clients in improving their sleep, sex, and overall health.

Selfridges highlights the pandemic’s acceleration of the well-being ecosystem becoming more holistic and tech-driven. Supplements, superfoods, and ingestibles were up 125 percent since last year and almost 700 percent compared to pre-pandemic.

The department store is differentiating through a more biologically based offering that includes at-home health tests that allow customers to inspect their genes, blood, thyroid, and more. Many luxurious and unique health-based experiences like acupuncture sessions, IV drips, bio-hacking, and oxygen therapy will become available later in the year. Throughout July the cinema at Selfridges will convert into a sleep session area, allowing customers to take time out between shopping to nap.

Well-being will be extended throughout the store with chef Matthew Kenney offering a plant-based menu and an organic and biodynamic wine list at his restaurant Adesse on the second floor.

Selfridges introduces “The Feel Good Bar”

Going further: Selfridges “The Feel Good Bar”

What: Latin American Fashion Summit seeks to elevate the Latin American fashion industry through an Amazon collaboration.

Why it is important: The partnership with Amazon will allow customers to purchase from Latin American designers thus expanding the reach of Latin American fashion and enrich the industry overall.

The initiative builds on the new Luxury Stores concept for Amazon, which launched the platform to feature both established and emerging luxury brands on its site.

Products are all sold directly to consumers from the luxury brands and authorised retailers, ensuring authenticity.

Latin American Fashion Summit collaborates with Luxury Stores at Amazon

What: Chairman Shin Dong-bin suggests that Lotte Group will continue its capital expenditures despite inflation, rising interest rates, a global slump, and other challenges for the Korean conglomerate.

Why it is important: Earlier this year, Lotte Group pledged 37 trillion won investment over the next five years.

Chairman Shin emphasized that Lotte must transform its business portfolio by incorporating bio, healthcare & wellness, as well as mobility into its existing business lines of logistics, chemical, food, and hotels. Plans were discussed for the group to build up infrastructure, create a healthcare platform, and migrate the chemical business into hydrogen energy and battery materials.

Apart from business plans, Lotte discussed ways to help Busan’s bid to host the World Expo in 2030. It formed a group-wide task force led by Co-Vice Chairmen Song Yong-dok and Lee Dong-woo.

Lotte committed to capex investments despite challenges

What: The shopping mall owner Unibail-Rodamco-Westfield has raised its adjusted recurring earnings per share guidance due to first-half tenant sales in Europe recovering to pre-pandemic levels.

Why it is important: Doubt from renting retailers and mall tenants is improving with results showing in Unibail-Rodamco-Westfield’s first half of 2022 reports.

Retail operation performance, the end of Covid rent relief and higher variable income were some reasons the group believes its first-half year over year was up 53%. Following the group’s de-leveraging plan announced last year, debt has dropped by 1 billion euros. Confident in their assets being in the best catchment areas with affluent customer bases, the group is hopeful to achieve its goals in Europe by the end of the year and in the US by 2023.

The group’s main rival Klepierre has also raised its full-year guidance.

Mall owner Unibail-Rodamco-Westfield raises guidance

What: Amazon is set to purchase One Medical for 3.9 billion dollars as it moves further into health care services.

Why it is important: One Medical’s mission has been to make healthcare more accessible and affordable through in-person, digital and virtual care services by allowing healthcare providers across the US to integrate its technology and enable patients to schedule appointments, renew prescriptions and access health records online.

Amazon Health Services sees the potential to reinvent the health care industry by using its size and platform. The company has purchased One Medical for 18 dollars a share in an all-cash transaction, including net debt.

Amir Dan Rubin will remain as CEO of One Medical.

Amazon Health Services expansion 

What: Analysts view the pandemic’s contribution to the boom in luxury sales as ‘outsized’ and predict a normalization on the horizon.

Why it is important: The post-pandemic revenge spending seen outside of China is expected to dampen in the coming months as recession, inflation, and Chinese economic policies may begin to weigh on luxury consumers.

Looking at Richemont and Burberry, double-digit first-quarter postings show that clients are eagerly shopping as restrictions have been lifted, but background politics and macro trends loom heavy on the market.

Richemont’s sales in Europe grew by 42%, due to “robust domestic demand,” and a return in tourist spending, primarily from American and Middle Eastern clients. Growth was strong across markets, particularly in France where sales increased in the triple digits.

Mainland China was a drag on growth due to COVID-19-related lockdowns, but other countries in the APAC region helped to mitigate those declines. In the 13 weeks to July 2, Burberry’s retail revenue increased 5.4% to 505 million pounds, while at constant exchange, growth was flat.

Burberry surprised the markets with a 1% uptick in comparable store sales after analysts had predicted a 2% contraction. Like Richemont, Burberry also saw strong demand in Europe, with comparable-store sales growing 47% due to demand from local clients and sales to American tourists.

However, Richemont saw better growth overall, reporting sales in the Americas region climbing to 79% and putting it on par with Europe as one of Richemont’s most lucrative regions. Mainland China trends are promising as well with demand for Richemont’s big-ticket items remaining strong. The luxury fashion market stability will be impacted by the consumer sentiment towards macro trends affecting the global economy.

Uncertain longevity for boom in luxury sales

What: Improved economic performance has inspired Frasers to act on serious plans for international expansion through acquisitions and new store openings.

Why it is important: This new expansion plan will necessitate consolidation of the group’s portfolio, reducing the number of Sports Direct stores, but increasing the sales area.

Part of this expansion includes the luxury brand Flannels. Due to great performance, there are plans to double the number of stores in the UK and Ireland and to establish the brand in cities across the European continent.

Frasers is readjusting its strategy by closing locations that are too large for the cities they are in but working on acquisitions, joint ventures and organic openings to further its international operating activities. Its goal is to offer a better experience to customers by optimizing store performance, location and size.

Frasers plans expansion

What: Nordstrom has promoted Deniz Anders to senior VP and chief marketing officer; and, Nina Barjesteh has joined the team as president of Nordstrom Product Group.

Why it is important: The experience shared between these two female executives will be used for Nordstrom to build and transform its private label business.

Nina Barjesteh, who will become the new president of the Nordstrom Product Group, brings her previous experience in merchandise and branding across apparel and accessories for both women and kids. She is leaving her previous role as Dick’s Sporting Goods senior VP of product development and design.

Deniz Anders has had 22 years of experience with Nordstroms, most recently as vice president of marketing. Through her deep marketing knowledge and background with Nordstrom, the combined skills of Anders and Barjesteh are projected to grow and develop Nordstrom Made products.

The efforts made toward marketing and developing private labels indicate a shift in strategy that may grow Nordstrom’s product positioning.

Nordstrom’s growth strategy relies on new executives

What: Brands and customers are still confused about the differences between web3 and the metaverse.

Why it is important:  A McKinsey study predicts that the metaverse will have up to 2.6 trillion USD in value for e-commerce by 2030. While the survey results showed that 64% of consumers indicated they were excited about metaverse shopping, other research from Wunderman Thompson Intelligence showed that consumers have very little understanding of what the metaverse is.

Brands also lack a deep understanding of the difference between web3 and the metaverse. Still, there continue to be many brands joining platforms like ROBLOX, which does not use blockchain technology, to establish a solid digital presence and offer virtual shopping experiences.

Virtual shopping is mislabeled as metaverse

What: Reports show that the acceptance of crypto payments is not always in the best interest of brands or retailers.

Why it is important: Younger consumers are quick to adopt cryptocurrency and many companies are looking at the long-term role of crypto in retail transactions, expecting the current user demographic to grow and change over time. Some companies are justifiably hesitant when they consider their target consumer.

While many brands have recently announced accepting crypto payments, reports show that cryptocurrency is, for the moment, primarily used for investment and trading. In addition, the percentage of women using crypto for payment, trading, or other reasons is significantly lower than it is within the male demographic.

Reports also point to market volatility as a caution for retailers. While it is assumed that fees will be lower, it has been reported that transaction fees for merchants fluctuate regularly. As well, crypto transactions aren’t private since businesses need to report any changes in crypto value as they are subject to capital gains taxes.

Only 2% of U.S. adults used crypto for payment over the prior 12 months, making it clear that smaller retailers should define their target consumer when considering accepting crypto payments.

Retailers navigating crypto payment

What: Business of Fashion explains the driving force behind the menswear market’s unprecedented boom.

Why it is important: In preparation for our IADS Men’s Fashion Meeting on September 6, we would like to share Business of Fashion’s highlights on the menswear boom. Streetwear is out, casual tailored styles are in.

Casualisation has been seeping its way into fashion long before the pandemic, but the work-from-home lifestyle has cemented new silhouettes that prioritise comfort. Surprisingly, the importance of comfort does not equal streetwear. Retailers report that streetwear is losing momentum and loungewear pieces such as hoodies, tracksuits and sneakers are no longer hit items. The items replacing these fall into clothing that can be styled for multiple occasions with a priority on fit and feel. Men’s shirting, casual jackets, loafers, and even accessories like bags and sunglasses are increasing in popularity.

The connection between a more casual yet styled menswear look has been tied to social media and chat platforms (Instragram, Podcasts, Discord channels, and subreddits) allowing men to discover fashion on their own and exchange with each other regarding menswear trends. In addition, gender fluidity plays another role in widening the scope of men’s fashion.

Suiting is being scaled back by both retailers and designers to promote casual menswear like sports coats and knitwear. The trend “blokecore” – a viral subculture that celebrates the style of middle-aged men and has reached 27 million views on Tiktok – is one example of shifting menswear styles and how these trends are communicated.

Men are also favouring a tailored look. Flannels is meeting the rising market demand by investing in a personalized menswear shopping experience. Their Liverpool flagship will be offering alterations and made-to-measure styles with a selection of fabrics from over 10 participating brands.

As suiting fades in relevance brands are pursuing a sportier approach. Brands like Burberry Gucci and Dior are looking to new sports star ambassadors to capitalize on the growing interest from new audiences of men.

Euromonitor projects the category will grow faster than womenswear over the next four years, expanding to 547.9 billion USD by 2026, at an average annual growth rate of 5.8%, compared to 5.3% for womenswear. At London-based luxury retailer MatchesFashion, sales of men’s clothing are up 40% compared to the same period last year, while men’s footwear is up 50%.

Menswear Market on the rise

What: Iguatemi names for the first time a non-family member and a female at the top post.

Why it is important: Even though Iguatemi is a mall operator, its challenges and points of attention are not far from many department stores’ in the world.

Cristina Betts is the first female and non-family member to be the CEO at Iguatemi, succeeding Carlos Jereissati. Iguatemi, a luxury shopping center company in Brazil, currently operates 14 malls, 2 outlets and various real estate locations.

It reports a 30% sales increase for Q2 2022 vs. the same period in 2019, with a stronger performance for apparel, shoes and leather goods which achieved a growth of 51%. This performance is allowed by the fact that 70% of the brands present at Iguatemi are local, and therefore relatively spared by the international issues. This combines with an increased conversion rate with customers realizing that buying in the country is actually equivalent, and more convenient, than buying internationally.

For her, the priorities are:

• Security in malls, especially given the fact that physical retail is here to stay,
• Combination with online, which, in the case of Iguatemi, means a marketplace for luxury brands,
• Being able to cater for the needs of all customers and not only luxury ones, through the right brand assortment and F&B or experience proposal.

Cristina Betts is the new CEO at Iguatemi 

What: Klarna and Shein team up for a pop-up shop in Berlin as part of its 2 Summer Oasis2 pop-up tour.

Why it is important: A temporary experience at Kurfürstendamm 68 in Berlin will welcome Klarna and Shein for a pop-up with events, music, food, and even a beauty bar.

As part of Klarna’s 2 Summer Oasis2 pop-up tour, customers can enjoy discovering Shein’s summer collection in-store with the ability to purchase online at a reduced price and receive home delivery. In addition, customers can attend one of the three workshops. The workshops are focused on beauty and a clothing exchange market.

Klarna aims for the partnership to be an inspiring exchange for customers that can help them decelerate from the bustle of the city.

Shein and Klarna pop-up in Berlin

What: Amazon Fashion Europe has announced its first-ever partnership with Twitch, the video live-streaming service that focuses on video gaming streaming, to showcase its best summer styles and brands.

Why it is important: As many retailers turn towards live-streaming or live-shopping events, Amazon’s collaboration with Twitch will be an example for other fashion retailers to watch when considering their next digital marketing strategy.

The collaboration will see two teams of Twitch content creators enter into a week-long European road trip starting July 23 from the Amazon Fashion Studios in Hoxton, London.

During the race across Europe the “Twitch superstars, emerging creators and fashion insiders” will complete fun fashion challenges hosted by some Amazon Fashion brands, while showing off their Amazon Fashion looks for every location and activity.

Amazon Fashion Europe & Twitch collaboration

What: Secondhand marketplace Vinted unveils ‘Vinted Go’, a new B2B shipping platform.

Why it is important: Vinted Go’s technology, IT and operations infrastructure enable businesses to ‘plug in’ to Vinted’s multi-carrier network through a single integration process. The ultimate goal is to remove the need to sign multiple individual agreements with carriers to get the best-priced and most convenient delivery solution.

The new offering is available for domestic and cross-border deliveries across Europe focusing on PUDO (pick-up, drop-off). PUDO as a delivery option can have lower carbon emissions than in-home delivery, ad will provide customers access to its ever-growing network of national and international shipping carriers in 14 countries.

Vinted Go has a strong pipeline of potential new customers who are looking to improve their deliveries to PUDO, in Spain, Italy, France, the UK, Benelux, Germany.

Vinted’s new B2B shipping platform

What: Bloomingdale’s Aqua is extending its lineage of collaborations by teaming up with Studio 189 on a limited-edition collection.

Why it is important: Bloomingdale’s private brand, Aqua, has a history of collaborating with different designers, brands, and celebrities. This limited-edition collection is a collaboration with actress/activist Rosario Dawson’s brand Studio 189. Bloomingdale’s and Dawson will release hand-dyed garments produced by Studio 189 artisans from Ghana, Africa.

“The special hand-batiked prints that were created exclusively for this collaboration resulted in Studio 189’s largest single fabric order to date, which grants us the opportunity to present the craftsmanship of our artisans to a broader audience. It’s an accessible collection that embraces joy with vibrant and tropical designs fitting for the summer season,” said Abrima Erwiah, head designer for Studio 189.

Bloomingdale’s Aqua brand collaborates with Rosario Dawson’s Studio 189

What: The trend of branded cafés and restaurants continues as more luxury fashion brands open food&beverage locations.

Why it is important: Consumer experience continues to be the goal of brands as brands and retailers shift towards well-being, hotels and restaurants.

Gastronomy can constitute a new lever for growth for brands by converting less efficient commercial spaces into areas dedicated to catering. This diversification also allows brands to enrich their offer and reinforce their image and lifestyle positioning.

Considering the pandemic, the rush into diversifying their income seems logical as the crisis forced brands and retailers to reconsider how to expand their audience while encouraging the customer to extend their presence in their spaces.  By creating a complete universe around the brand, it also manages to build better customer loyalty, capture their attention, and encourage a larger basket size.

Ultimately, the consumers also assist the brands outside of revenue through earned media posts on social media about the experiences in these spaces.

Fashion brands continue entering F&B

What: The fragrance category gets a shake-up as a new generation of brands addresses the trend of wellness, innovation, and sustainability.

Why it is important: In many cities, fragrance accounts for a large percentage of prestige beauty sales and is reported to be increasing. Credentials and marketing are falling behind successful campaigns which emphasize wellness and commitment to sustainable values.

Over the past decade, beauty brand acquisitions have been on the rise. Market research from the NPD Group notes that fragrance remains the “undisputed champion in beauty”. Strategic partnerships between fragrance brands and companies in other sectors have seen success as well.

As it is difficult to shift the needle in a crowded market, fragrance brands are betting on wellness, leaning into cultural hypes, and spotlighting sustainability. All of these tactics as well as harnessing influencers are drawing in young customers, whose spending is in flux as they are likely to have a fragrance wardrobe, rather than a signature scent, and are motivated by the experience of shopping and wearing the perfume.

Shifting consumer habits for fragrances

What: Following its first half results and success with Kering Eyewear, the Kering Group is looking to create value within the beauty segment.

Why it is important: While it remains unclear if Kering will launch through licensing or acquisitions, the group is well positioned to expand into the beauty segment.

Kering operates under a licensing model with Coty Inc. with whom they have expressed dissatisfaction in the past for having failed to capitalize fully on the segment. Now, with a free cash flow of 2.05 billion euros in the first half of 2022, Kering is well positioned to make acquisitions. The group announced in 2019 that its M&A search was back on, but it has struck only a handful of small deals since then.

While reports look good as many Kering brands had high sales increases and growth, Gucci, their top performing brand, slowed in comparison due to its exposure in China. The euro’s slide to parity against the U.S. dollar did boost top-line revenues for companies that sell many of their goods abroad like Kering’s brands. In addition, U.S. tourists have taken advantage of the cheap euro to splurge on luxury goods abroad.

Whether through launching a beauty line or diversifying the group’s portfolio with acquisitions, Kering maintains that entering the beauty segment is inevitable.

Kering looks to beauty 

What: Saks Off 5th is moving further into the second-hand market through its recent partnership with Rent the Runway by adding labels previously not carried on the platform and bolstering the current assortment.

Why it is important: The partnership enables Saks Off 5th to introduce brands it didn’t previously sell, expand selections from those already carried, and tap a rapidly growing segment of customers seeking more value.

As inflation increases, the partnership comes at an ideal time to offer consumers a sustainable and value-centric offer.  The expansion of Saks Off 5th previously present assortment also answers consumer demand by providing greater size, integrity and depth that is beneficial from a pre-owned perspective. Rent the Runway has an engaged customer in the resale market due to their strategy of broadening reselling and subscription services. Their mission is to introduce an even wider audience to the environmental and financial value of preloved fashion.

Saks Off 5th entered the resale market in 2020 with LXR & Co., a provider of pre-owned vintage handbags and leather accessories from luxury and premium brands. For this partnership, SaksOff5th.com has created a “pre-owned” section to house Rent the Runway’s second-hand items labelled with a distinct badge. Saks aims to include “predominantly in season” merchandise to only be sold on SaksOff5th.com.

Both Saks Off 5th and Rent the Runway mutually benefit from the shared audience and consumer trust in each brand’s respective expertise.

Saks Off 5th partnering with Rent the Runway

What: Frasers Group has bought a 28.7% stake in Australian-based fashion marketplace MySale.

Why it is important: Frasers Group believes the deal will provide a “strategic partnership whereby end of line group products can be cleared via an established clearance channel”.

Fraser Group upped its stake in Hugo Boss. They now own 3.4 million shares of common stock, representing a 4.9% stake in Hugo Boss, and 18.3 million shares of common stock via the sale of put options, representing a 26% stake.

Frasers Group also bought Missguided for 20 million.

Frasers Group acquires 29% stake in MySale 

What: User-generated platform Xiaohongshu is the source of lifestyle trends for Chinese consumers making it an ideal entry point for international brands seeking authentic feedback.

Why it is important: With a large community of consumption-motivated users seeking new experiences and items, Xiaohongshu is a key partner in connecting brands with the Chinese consumer.

The organic user-generated content can also inform established brands on how to adjust their product lineup to meet Chinese consumer interest. Its popularity as the leading source of lifestyle trends and product recommendations helps guide many Chinese consumers in their purchasing decisions.

In recent years, international brands also have gained more consumer familiarity with increased time spent working, living, travelling and studying abroad. Thus, Xiaohongshu is ideal for international luxury and fashion brands seeking to uncover Chinese consumer trends, leverage the platform to raise awareness and nurture loyalty by directly connecting with consumers.

Xiaohongshu’s large community of consumers is the perfect testing ground for new things. This includes metaverse trends with the possibility to sell NFTs in its virtual space, R-Space.

Brands gain entry to Chinese market through Xiaohongshu platform 

What: Clinique has debuted a new retail concept in Macy’s Herald Square in Manhattan.

Why it is important: Clinique is rolling out a new retail concept that combines self-shopping, digital experiences, and in-person clienteling to create an experience that aims to redefine the brand positioning and DNA.

Digital features include Clinique’s ‘Clinical Reality’ technology that scans the faces of clients and offers a customized assortment of product recommendations. In the centre, the ‘Discovery Table’ offers new products and classic best sellers. Consultants are also available at the ‘Community Bar’ to assist clients when needed. Despite being able to scale the project across stores and location sizes, the biggest challenge for Clinique has been brand familiarity.

The goal of this new concept is to reshape the perception of Clinique by delivering an unseen experience that can attract younger consumers and reinvigorate the excitement in dedicated clients.

Clinique’s new retail concept in Macy’s