What: Retaildetail reviews the changes taking place within Inno and questions the lack of radicality in the decisions made.

Why it is important: Inno is a household name in Belgium but no company is too big to fail anymore in retail.

Inno from Belgium has been founded in 1897 under the name “A L’Innovation” and was a pioneer in Europe for this retail format (A l’Innovation is a founding member of the IADS). The celebration of its 125th year of existence is turbulent: due to cash issues, the company had to put half of the staff on temporary unemployment a few weeks ago, and even though they are back in stores now, the malaise is here. The company belongs to Galeria Kaufhof.

A new CEO, Armin Devender, took office in 2019 with a clear plan:

• Rejuvenation of the stores both from a physical perspective and in terms of brand and product assortment,
• A higher brand positioning, leading to a full rebranding of the company,
• More room for food and catering, including partnerships with F&B companies such as lunch chain BON,
• The launch of an e-commerce cum marketplace website.

However the article questions the speed of changes implemented within the company. Short of cash and without much time ahead, it seems that Inno should be making more radical choices, just like what other department store companies such as Galeries Lafayette have done by transferring the property of their stores to other companies.

Is Inno ready for the next 125 years? 

What: Macy’s, Inc. reported financial results for the first quarter of 2022 and updated its annual guidance.

Why is it important: Diluted earnings per share of USD0.98 and adjusted diluted earnings per share of USD1.08. This compares to diluted earnings per share of USD0.32 and adjusted diluted earnings per share of USD0.39.

Comparable sales were up 12.8% on an owned basis and up 12.4% on an owned-plus-licensed basis. Digital sales increased 2% year-over-year while increasing 34% versus the first quarter of 2019. Digital penetration was 33% of net sales, a 4-percentage point decline from the first quarter of 2021, but a 9-percentage point improvement over the first quarter of 2019.

Macy’s comparable sales were up 10.7% on an owned basis and up 10.1%, on an owned-plus-licensed basis.

Star Rewards program members made up approximately 69% of the total Macy's brand owned-plus-licensed sales on a trailing twelve-month basis, up approximately 6 percentage points versus the prior year.

Consumer shopping behaviors shifted during the quarter to more occasion-based apparel. As a result, dresses, women’s shoes, accessories, and men’s tailored had strong sales performance.

Bloomingdale’s comparable sales on an owned basis were up 28.1% and on an owned-plus-licensed basis were up 26.9%. Bluemercury comparable sales were up 25.2% on an owned and owned-plus-licensed basis.

Gross margin for the quarter was 39.6%, up from 38.6% in the first quarter of 2021.

Macy’s, Inc. Reports First Quarter 2022 Results

What: The German online fashion retailer’s first-quarter sales fell by 1.5 percent , to EUR 2.2 billion (USD 2.33 billion), after posting a 46.8 percent increase in the same quarter last year thanks to the coronavirus pandemic.

Why it is important: As pandemic restrictions have eased, people are returning to in-store shopping, which is why online retailers like Zalanso are only able to increase their number of customers slightly.

Zalando now sees 2022 sales growth coming in at the lower end of the forecast range. For the three months from January to March, the company reported an adjusted operating loss of almost EUR 52 million, compared with a year-earlier profit of EUR 93 million.

“The main issue is that people just aren’t into buying fashion,” said co-chief executive officer Robert Gentz with a view to high inflation and the war in Ukraine.

Zalando has posted a decline in sales for the first time since being founded

What: Paris is slowly returning to its pre-pandemic touristic activity.

Why it is important: Paris department stores and other touristic players have ween waiting for such news for months. It might also trickle down to the rest of the country and Europe as Paris can also be an entry door for many tourists looking to stay longer and to have a variety of experiences.

Paris tourism is bouncing back: the city is the second-most sought-after destination worldwide this year after London,  (Prepandemic, Paris held the first place, and during the Covid-19 pandemic, it was relegated at the seventh position). Hotel revenue is currently up 20% compared to the past weeks and occupancy is on par with May 2019 at 80-90%.

It is expected that the trend should follow, and this will be a welcomed relief for the country, as the tourism industry represents 7% of the total economy.

Paris tourism rebounds thanks to Europeans and Americans 

What: An English retail expert advocates for a complete review of the retail portfolio in the UK.

Why it is important:  If such a reassessment was to be done, that might be an opportunity for English department stores to become central again, after a four decades old of competing with brands’ retail networks.

Sir John Timpson, owner of the UK shoe repair chain Timpson and member of the UK government’s high street experts panel, advocates that the high street retail scene is still too crowded in the country, and not diversified enough.

For him, the whole property portfolio needs to be reviewed and reassessed, even if this means that high street retail leaves room to other types of activities, such as leisure, entertainment, hospitality or medical services.

He appeals to the government to make decisions and new regulations, and believes that such a situation is the natural consequence of the appearance of supermarkets, retail parks and e-commerce, badly hitting city centres.

Is the UK about to downsizing the number of high street retail units? 

What: Century 21 is making a New York City comeback, to the very same flagship location on Cortlandt Street across from the World Trade Center in lower Manhattan

Why is it important: The reopening of what was one of the city’s most popular and productive retail destinations will happen sometime in spring 2023. Century 21 went bankrupt and liquidated its flagship and all its other stores in 2020.

The revived flagship will be a streamlined version of the original, and will be running with the assistance of Legends, a company that oversees retail and hospitality operations at landmark establishments, including in New York the MLB flagship on Sixth Avenue; Yankee Stadium, and One World Observatory. It has also been behind the operations of such events as the 2012 and 2016 Olympics.

The revived flagship will have about 100,000 square feet over four floors, three less than the old flagship, which occupied about 200,000 square feet over seven levels. It will be focused on men’s, women’s, and kids’ apparel, outerwear, and accessories; handbags; footwear; sunglasses, and fragrances.

Century 21 is returning to downtown NYC

What: Shinsegae International reported a first-quarter net profit of 26.8 billion won ($21 million), up 13.3 percent from a year earlier.

Why it is important: The company said in a regulatory filing that it posted 33.1 billion won in operating profit for the quarter, compared with 21.3 billion won a year ago. Revenue rose 3 percent to 352.2 billion won.

Shinsegae International Q1 results

What: Leading luxury names are joining a group of UK businesses to support employment charity Refuaid helping refugees from Ukraine.

Why is it important: Harrods and Mulberry are among the latest supporters of the UK Ukraine Business Consortium Network. The companies involved will each sponsor a set number of refugees through Refuaid’s education and employment programme.

The consortium is hoping to create long-term infrastructure to benefit any refugees coming to the UK. In the three years since its foundation, Refuaid has supported over 800 people with access to language tuition, finance, and employment.

Harrods supports Ukraine refugee scheme

What: Magazine Luiza SA reported net revenue of USD 1.7 billion in the first quarter of 2022, up 6.2% year-on-year, signaling a return to growth after a decline of 6.6% in the previous quarter.

Why is it important: Total sales in Q1 2022 were up 13.2% to USD14.12 billion compared to USD12.47 billion in the same period last year. The result can be largely attributed to the recovery of physical store sales, which grew 6% to USD4 billion, and the company’s sustained e-commerce business. The latter reached USD10 billion, representing a 10% increase year-on-year.

Brazilian magazine Luiza returns to growth

What: Le Bon Marché transforms its alleys into a holiday camp and celebrates sunny days with a new highlight called "Un air d'été", which gives pride of place to nomadic adventures and song.

Why is it important: Le Bon Marché focuses on its French roots by joining forces with the Breton music festival Les Vieilles Charrues, which celebrates its 30th anniversary this year.

Since April 30 and until June 19, the point of sale has played it bohemian and camping chic by hosting a series of pop-up stores and exclusive products steeped in this theme.

The Céline house offers a beach corner entitled "Plein Soleil", the Brazilian label Farm Rio reveals its colorful and gipsy universe, while the clothes of the Antik Batik camp advocate "a return to the roots.”

On the music side, in partnership with the festival to be held from July 14 to 17 in Carhaix, a series of free mini-concerts are organized every Tuesday evening for seven weeks. Le Bon Marché is continuing its event strategy there to stage its sales area while preparing for the start of the school year with an immersive live show, “Au Bonheur des Dames".

Le Bon Marché celebrates sunny days with the Vieilles Charrues

What: Lotte opens its first location in Australia after not having opened any international store in 2 years.

Why it is important: Now that airports are crammed with operators, Lotte seems to export the very Asian concept of city centre duty free stores. In Europe, only one location (Venice) has such a feature. Could that be a new threat to department stores in iconic locations?

South Korean travel retailer Lotte Duty Free has opened its first store in Sydney, on a total surface of 3,200 square metres and 3 levels, at the heart of the retail precinct. Lotte has not opened a new store outside of South Korea since 2020 with its Singapore Changi Airport location.

Lotte plans to become largest Australia duty-free store operator with a turnover target of AUD $790mn (the total Australian duty free market was valued at AUD $800mn pre-Covid).

Instead of having opened in the airport itself, where Heinemann has the main retail concession, the city centre duty free store has been thought to be a destination per se, therefore with an inviting concept and with the target to be seen as a regular store by local customers too. To sustain that approach, Lotte is introducing brands that are new to the Australian market.

Lotte resumes global growth with first steps in Australia 

What: Shein releases a new collection which ticks all the boxes of respectability: sustainable, responsible and socially committed.

Why it is important: Shein has been massively criticized for its opacity and environmental impact. This new collection shows that they are addressing these criticisms seriously, even though the size of the collection (1,500 at the end of September) is quite small compared to the usual business at Shein (6,000 new products per day).

Shein has announced the launch of evoluShein, a purpose-driven collection available worldwide online at the end of April. This line includes inclusive sizing, responsibly sourced materials and supports women’s empowerment.

The line is also connected to Vital Voices, an international non-profit organization investing in women leaders addressing gender-based violence, climate crisis and economic inequalities.

The first capsule includes recycled polyester used from plastic waste, which uses less water and energy than virgin polyester and Shein aims to use evoluShein as a laboratory to test new sustainable ideas and processes before rolling them over for the regular Shein products.

Shein envisions a total collection of 1,500 SKUs for evoluShein within September 2022. For memory, Shein releases 6,000 new products per week.

Shein unveils a purpose-led range 

What: US department stores are increasingly leaving malls and opening smaller units in local communities.

Why it is important: This is a global trend with most of the largest players in the department store business making experiments on their own (Galeries Lafayette, Falabella and others).

Following Nordstrom and Bloomingdale’s examples of smaller stores with fewer products and more digital services to cater for local communities needs, Macy’s has opened five Market by Macy’s locations over the past 2 years in Texas. Those stores span over a total surface comprised between 2,200 sqm and 5,800 sqm, a fifth of the average Macy’s store surface.

During Q4 2021 sales in these units surpassed Macy’s expectations, and the group plans to open 10 off-mall locations this year, including some Market by Macy’s units, in addition to Macy’s Backstage (off-price), Bloomie’s and Bloomingdale’s outlets.

Macy’s is accelerating on the smaller store format 

What: The global Thai operator is renewing with growth on all three markets.

Why it is important: Vietnam and Thailand are widely reported in the article, however no detail is given about Italy. During our meeting with Coin (La Rinascente competitor) in March, the picture in Italy was not as rosy as the article suggests.

Central Retail has reported improved sales across its 3 global markets during Q1 2022, leading a group sales raise of +16%, to USD 1,6bn and USD 38mn net profit.

Omnichannel has increased +44% during the last quarter 2021, and the group has plans for expansion on all three markets.

Central Retail reports growth in Thailand, Vietnam and Italy 

What: Lotte is falling victim of strong geopolitical forces.

Why it is important: China is a demanding market both in terms of the size of needed investments, but also in dealing with political demands.

South Korea’s largest retailer is finalizing its Chinese exit by closing down its HQ in the country in the second half of the year.

Even though the group is looking at many opportunities in South East Asia (such as Vietnam or Australia, where a duty-free store was recently opened), it started to gradually close down its 130 stores in China due to geopolitical tensions and customer boycott movements.

Lotte is finalizing its China exit 

What: Hospitality is following suit to retail and monetizes the customer data it can gather.

Why it is important: Media Network is not anymore limited to retail: any significant player in the world with enough transaction points with customers can enter the game. As a consequence, retailers will need to make sure that their brand is clear and attractive to advertisers to stand out.

The American hotel chain Marriott has decided to launch into Media Network with the support of Yahoo, offering to advertisers the possibility to reach targeted customers through its apps, websites and room TVs. Anonymized customer data from past searches and reservations will be used to enable brands to display ads relevant to travelers. However, customer or loyalty member data should not be used.

Yahoo will be a supporting partner for the technological part. This move is a direct consequence of Apple’s privacy efforts, which has pushed the whole industry to question how to use first party data and monetize it.

Marriott to debut Ad Network 

What: Walmart is testing a new delivery method in Arkansas with a smart box system.

Why it is important: Displays of innovation are an efficient way to be visible and improve the perception of the company potential investors could have. This delivery method seems hardly scalable or financially sustainable, however it is presented as a true innovation.

Walmart uses HomeValet’s temperature-controlled smart boxes to make a trial and deliver groceries contact-free during the whole day. The box includes a freezer, a fridge and a dry storage, and opens with a one-time code for associates, and a permanent one for home owners.

The set up is currently being tested and Arkansas and could roll out in other states if there is interest from customers.

Walmart tries smart box for home delivery 

What: The company collected almost USD 50 million in rent and close to USD 100 million from its attractions, among other revenue sources, but incurred more than  USD 230 million in expenses according to its filing with the Municipal Securities Rulemaking Board.

Why it is important: The ongoing pandemic continues to affect customer behaviour, supply chains, and the economy which has led the The American Dream mall to lose close to USD 60 million last year.

American Dream lost USD 60M last year

What: The Saks “ecosystem” of dot-com and stores is sustaining momentum as their assortments grow, diversify and capitalize on a pickup in women’s luxury fashion sales.

Why is it important: Sales at Saks.com, on a gross merchandising value basis for the first quarter of fiscal 2022, increased by 69% compared to the “strong” first quarter of 2021. On a two-year basis, GMV was up by 107%.

The Saks Fifth Avenue “ecosystem,” (Saks.com and the Saks Fifth Avenue stores) GMV was up 50% compared to the first quarter of 2019.

By diversifying the business model, Saks can more quickly add categories and brands it previously did not sell and expand those where it sees opportunities.

Women’s fashion is back in a big way. Respondents shared that they are spending more time in the office, and shopping for both travel and events. Furthermore, across the Saks Fifth Avenue combined digital and physical ecosystem, there is an ongoing appetite for luxury fashion; as such, women’s ready-to-wear, particularly dresses, and accessories were top-performing categories in the first quarter.

Saks is putting in place several initiatives to further customer service and personalization and an array of recent events and experiences to engage customers, including a post-purchase “ambassador” service program for higher-spending customers, a 360-degree campaign featuring Academy Award-winning actress Lupita Nyong’o, and a New York Fashion Week dinner at L’Avenue at Saks.

Saks’ Women’s Fashion is back in a big way

What: Pride + Joy take center stage as Macy’s kicks off National Pride Month and honors the contributions of the LGBTQ community.

Why is it important: In support of the company’s mission to build a brighter future with bold representation, Macy’s will launch its round-up and donation campaign in stores and online at macys.com to benefit its longtime partner The Trevor Project.

Macy’s will also recognize Pride with exclusive merchandise available at select stores, on macys.com and its app, bring joy to local community Pride parades in select markets nationwide, highlight LGBTQ-owned brands and host special events at select stores.

Macy’s honors Pride month

What: Target announced a series of leadership shifts by elevating its chief supply chain and logistics officer to the leadership team.

Why it is important: The retailer claims that the updates being made to the C-Suite reflect the size and scale of the USD 100 billion business while positioning the company for continued momentum into the future.

The retailer admitted that it will be much more difficult to generate growth in the coming years, but the focus is now on guest experience where customer friction and frustrations need to be minimized and delight needs to be amplified.

Target focuses on customer experience, supply chain in latest leadership shuffle

What: Nordstrom will be closing its personalised clothing service and will instead focus its efforts on e-commerce styling

Why is it important: Subscription box service models have recently been questioned. Nordstrom acquired Trunk Club back in 2014, for a reported USD350 million. The startup was created during the initial wave of subscription box services, where stylists would ship clothing to customers once they had fashion consultations.

Nordstrom bought the business to update its personal styling but failed to make Trunk Club profitable. In 2016, Nordstrom took a USD197 million write-down on the business.

Over the years, Nordstrom expanded Trunk Club into womenswear and also opened retail locations, but shuttered Trunk Club stores back in 2020.

Nordstrom to close the Trunk Club

What: Fashion companies are looking to build their own resale channels, giving rise to a new class of B2B start-ups that aim to help them navigate the nascent industry.

Why is it important: Resale, once dismissed by brands as an engine for counterfeits has now become a rapidly growing part of mainstream e-commerce. The US secondhand fashion market is slated to reach USD57 billion by 2025. In 2020, resale accounted for 10% of all US retail sales, up from 5% in 2016. In the past decade, the bulk of this market has been dominated by third-party giants like The RealReal, ThredUp, and Poshmark. But, as the space continues to expand, brands themselves are looking to control the customer journey in the pre-owned realm.

This trend has given rise to a flurry of resale-as-service platforms that handle the backend process of a brand’s owned resale business, which includes inventory collection, verification, and ultimately, sale. Some of the category’s newest entrants include Lululemon, Net-A-Porter, and Hugo Boss, working with RaaS firms such as Trove, Reflaunt, and Faume.

For brands, resale isn’t necessarily a revenue driver but about being part of a consumer experience that’s happening with or without them. While retailers are betting it may eventually become a profitable part of their models, most are focused currently on resale’s potential for driving customer acquisition and loyalty.

Brands are racing into resale

What: Coresight reviews the reasons why the horizon is not bright for mass-market retailers.

Why it is important: Department Stores should take notice and focus on two parallel strategies, the first one being to nurture luxury and less price-conscious customers, and the second one being to review the assortment for the most price-conscious ones, in order to compensate by volumes the margin that will not be achieved otherwise.

Deborah Weinswig, the editor in chief of Coresight, reviews the current situation in the US, as most retailers have noted that customers passed up higher-margin and big-ticket items (home furnishing, apparel) in favor of essential or low-margin items (groceries, beauty). This is mainly due to the rising inflation and affecting mostly low and modest incomes, as luxury retailers (Nordstrom) appear to be unaffected so far.

On a worldwide basis, the situation in China is complicated as retail has been hit by the Covid lockdowns in Beijing and Shanghai, and this adds up to the renewal of trade barriers and fears of a global food shortage.

As a consequence, Weinswig expects that mass-market retailers might keep on suffering for the next year or so.

The current market might favour smaller tickets and margin products