In Menswear, while casualwear remains a driving force fuelled by the introduction of new brands, department stores have a new secret sauce for the category: community-driven experiences.

Last January, the IADS identified that casualwear continued to lead the menswear category despite more attention given to semi-formal wear and a growing concern for pricing. Since then, department stores have refined their strategies to capture - and retain - modern male consumers' hearts. With a keen focus on community-building through pop-up stores and lifestyle events, department stores foster deeper connections with their customers by creating engaging experiences.

In comparing the past two financial exercises, the average menswear turnover share for IADS members evolved differently according to the regions: while it remained stable in North America and the Middle East (two new areas for the IADS with Bloomingdale's and Chalhoub Group having joined in the past two years), it was more contrasted in Europe and trending slightly downwards overall, reflecting the ongoing pressure induced by continued inflation and the cost of life. Regarding price points, while the mid-range segment keeps on taking the lion's share with 28% of sales, it is notable that luxury, affordable luxury and premium combined segments take 56% of the total sales on average. Two parallel factors can explain this:

• The continued demand for semi-formal and occasion wear, as we identified last January,
• Department stores' elevation strategy through onboarding more sophisticated brands with higher price points and margins. While mid-range remains central to their business, many IADS members pursue premium and luxury strategies.

Finally, the entry-level segment represents a slightly decreasing but sizeable share of 16% of total sales.

In menswear, no matter the customer's age, casualwear is for all!

IADS partner NellyRodiidentified two significant trends shaping the menswear landscape that keep on blurring the border between tradition and self-expression in all customer segments:

• The resurgence of traditional craftsmanship and heritage-driven designs, with consumers favouring brands enhancing authenticity and quality.
• Boundaries are pushed away, with designers infusing humour, irony, and bold interpretations into menswear. This trend appeals to younger generations looking to break free from conventional styles and express individuality through daring and playful designs.

Strikingly, menswear is moving beyond rigid categories: customers seamlessly mix casualwear, workwear, and formal styles, breaking traditional fashion rules. Still, casualwear continues to lead the menswear departments, favoured for its effortless flexibility across different aspects of life and work. This reflects society's preference for adaptable clothing for various occasions and a convergence towards female customers' behaviour.

Brands: the difficult balancing between blockbusters and newcomers

NellyRodi presented its exclusive scouting of 34 up-and-coming brands, from must-haves to hidden gems, especially made for the Association's members:

• Must have brands: Aimé Leon Dore, Lemaire, Norse Projects, Octobre Éditions, Officine Générale, Casablanca, Barbour, Faguo.
• On trends: Homme Plissé, Mfpen Hereekvipering, Pompeii Brand, Noah, Jeanerica Jeans, Le Minor, Louis Gabriel Nouchi, Helmut Lang, Walk in Paris, Encré, SAMSØE SAMSØE
• Rising brands: Magliano, Hed Mayner, Kidsuper, Charles Jeffrey Loverboy, Auralee, A kind of Guise, Séfr, Kartik Research.
• Hidden gems: Drapeau Noir, Kardo, Cmmn Swdn, Caleb, Rier, Aalto + Recoded, Greg Laboratory.

Carrying must-haves and big brands is not a guaranteed path to success. Some blockbusters or well-known brands have mixed results across markets due to specific fits or marketing strategies that are too different. This shows a necessary adaption to local clientele and the need for a balanced brand portfolio beyond leading brands such as Boss(a brand that successfully relaunched by simplifying its product offer), Polo Ralph Lauren, Stone Island, Moncler, Dior and Carolina Herrera, depending on markets. New brand introductions also reflect an embrace of modern, urban fashion that aligns with the steady demand for streetwear. Breuninger added Represent and Fear of God Essentials, while Tryano welcomed Homiés Marbella and Scarosso. Magasin du Nord expanded with Barons, Hugo Blue, and Mango Man. Balancing world-class names with new labels is further complicated by the direct-to-customer or retail-only strategies sometimes pursued by the latter.

Community building is a growing priority for department stores

To win over customers, especially GenZ, the emphasis is increasingly shifting toward seasonal stores and events. While not new, pop-up stores and capsules remain an unparalleled way to attract customers in-store and contribute to building communities, a key to department stores' future. It has been the case with The Giving Movement and Sprayground at Tryano, On pop-up during the Olympics at Galeries Lafayette, Ami Paris, C.P. Company and Moose Knuckles pop-ups at Breuninger, Hugo Blue at Magasin du Nord, to name a few. Breuninger also partnered with German rap artist Rin, who attracted 10,000 fans through a Ljubav x Hugocollaboration and organised fashion talks with Stone Island and Esquire. These creative approaches allow retailers to connect more deeply with their target audience.

Besides, several department stores experiment with outdoor-related initiatives to foster deeper customer connections. A notable trend in community engagement is the focus on running, which has successfully created loyal customer bases, especially among the male customer base. Breuninger has partnered with brands like On to host weekly running events, attracting customers who value health and fitness. These events drive foot traffic while reinforcing brand loyalty through lifestyle community activities. Cycling clubs have also emerged as a growing trend, particularly in urban markets like Copenhagen. Magasin du Nord has tapped into this trend, noting that while niche, it's gaining traction among outdoor enthusiasts and urban dwellers.

Despite a slight decline in turnover share, the market remains dynamic, with casualwear leading the category and a growing focus on premium and luxury segments. Retailers adapt to shifting consumer preferences by refining their brand portfolios and engaging with consumers through community-building initiatives like pop-ups and events, ultimately aligning with shared values.

Read the full press release below:

IADS PRESS RELEASE: Boyner Istinye Park

IADS - Communiqué de presse - Mode masculine 2024

Fashion, Art, Technology and Experience Meet at the Brand New Boyner İstinyePark Istanbul

Transforming its stores as destinations that add value to everyone's lives, Boyner recently renovated its store in İstinyePark Istanbul. Digital merchandising applications, artworks, nail art area, Bubble Tea, one of the most popular beverages of the recent period, Costa Coffee, Europe's largest chain, and the most exclusive selections of world-renowned brands come together at Boyner İstinyePark Istanbul. A special invitation was held for Boyner İstinyePark Istanbul, which attracted attention with its renewed face, hosted by Boyner Büyük Mağazacılık Chairman Cem Boyner and Boyner Büyük Mağazacılık CEO Eren Çamurdan. Designed by London-based creative agency Bompas&Parr with the theme of "Sky Magic", the event allowed guests to discover the new world of Boyner İstinyePark and witness many special and different experiences in a magical environment dominated by thousands of shades and senses of the sky.

Transforming its stores into living spaces by offering fashion, art, technology and experience together, Boyner organized a special event hosted by Cem Boyner, Chairman of the Board of Boyner Büyük Mağazacılık, and Eren Çamurdan, CEO of Boyner Büyük Mağazacılık, at its İstinyePark Istanbul store, which was renovated with this concept. Designed with the concept of "Sky Magic" and attended by prominent names of the business, retail and fashion world, the special and different experience areas met with the guests. Guests who entered the store through the clouds experienced the smell of rain, witnessed the sunset, stepped into the colorful world of the rainbow and had the opportunity to touch the white clouds. The refreshments of the event, which featured a different experience at every point, were similarly inspired by the sky. Jelly candies resembling layered clouds added color and excitement to the night with their colors and different flavors.

Continuing its new generation retailing steps focusing on different experiences that will make life enjoyable, Boyner, which started with Boyner Cadde, one of the iconic shopping destinations of Baghdad Street, has recently given its İstinyePark Istanbul store a brand new face. Renovated by Toner Architecture, Boyner İstinyePark Istanbul's six thousand square meters of space features the collections of Turkey's and the world's well-known brands only at Boyner İstinyePark Istanbul, the works of ten artists from different disciplines specially designed for the spirit of Boyner and the interior architectural texture of the store, nail art with Ala Nail Art, product personalization area and digital experience points. Costa Coffee and Bubble Tea areas in the store add a special enjoyment to the shopping experience.

Many Applications from Different Fields of Art in the Store

Boyner İstinyePark features the works of artists from different fields of art, from ceramics to glass art, sculpture to mural art. The works designed by each artist using different materials such as ceramics, mirrors, wire, epoxy, waste glass and waste metal, which are special to the spirit of Boyner and the interior architectural texture of the store, create a feeling of an exhibition for the visitors.

Areas to Enrich the Shopping Experience are at the Forefront

Focusing on experience points with its new generation merchandising vision, Boyner offers many alternatives that will make shopping enjoyable for its visitors at IstinyePark store.

"Flip Dot Displays", which is one of the first sections that visitors will discover on their journey of experience, follows the movements of the person heading towards the store in harmony and activates the scales with sensors. In addition, the 3D futuristic sculpture and digital visuals located at the bottom of the store support this flow.

In the Ala Nail Art area in the store, visitors are offered a special nail care experience, while in another area there is an experience point where personalized designs can be made with special paints and drawings on fabric.

At the "Inspiration Wall", another attraction point of Boyner İstinyePark, visitors can choose the styles they like through the videos on the screen and get recommendations from the products in the store according to the style they choose. By registering the products they choose with a QR code, they can get support from the sales consultant in finding their products. In addition, the kiosks in the store display the stock status, content, price and reviews of the products to make the lives of the visitors easier.

Costa Coffee, the UK's most popular coffee brand, is located in the middle area of the store and welcomes those who want to take a pleasant break from shopping. Bobble Tea, which offers the most fun and colorful version of cold tea, also offers visitors a colorful and delicious experience.

World Famous Brands at Boyner İstinyePark

Boyner İstinyePark has many new brands in Women's, Men's, Shoes, Bags, Active, Outdoor, Home and Cosmetics categories, exclusive to this store. After Label, Le Twins, Cedelar, Urbancode, Pinko, Tombolini, Cacharel, John Richmond, Sseinse, K-Way, Duvetica, Ice Play, Ko Samui Tailors, Hvisk, Saucony, Mizuno, La Sportiva, Thirtytwo, Rab, Peak Performance, Volcom, Monologue, and in the cosmetics category, Atelier Versace and Prada Les Infusions stand out as special brands in Boyner İstinyePark's selection.

Boyner İstinyePark Istanbul invites everyone to be a part of this unique experience with its vibrant, dynamic, provocative, calm but pleasant and feel-good features.

Read the full press release below:

IADS PRESS RELEASE: Boyner Istinye Park

LSA has published an article discussing beauty and wellness trends in department stores. The article explores these consumer behaviors using the insights and figures from the IADS press release about cosmetics, beauty, and wellness, focusing on the wellness sector and the nice surprises which impact all categories of beauty.

LSA quoted IADS on beauty outperforming in department stores

Fashion Network has published an article discussing department store beauty sectors focusing mostly on fragrance and beauty. The article explores these consumer behaviors using the insights and figures from the IADS press release about cosmetics, beauty, and wellness, focusing on the influence of niche brands and how these preferences are experiencing a major shift.

Fashion Network quoted IADS on deprtment store beauty, fragrance and skincare

While fragrances continue to flourish in department stores, the convergence of cosmetics, beauty, and makeup under the all-encompassing "wellness" umbrella—a concept that transcends traditional notions of "care"—is now indisputable.

In October, the IADS highlighted the emergence of a post-pandemic feel-good factor in 2021-22, sparking increased demand for wellness-related products. This concept has since permeated all product categories, reflecting evolving customer preferences and compelling department stores to reimagine their approach to "care" products. Concurrently, new market dynamics in fragrances—with major brands adopting direct-to-consumer strategies while offering luxury lines to rival niche brands—explain the category's vibrancy, even as department stores remain vigilant for emerging trends.

For IADS members, the Cosmetics & Beauty business saw an average growth from 9% to 10% of total business between 2022 and 2023, with notable variations across categories. Fragrances surged from 36% to 45% of the Cosmetics & Beauty business, haircare increased from 3% to 5%, makeup held steady at 19%, while skincare declined from 34% to 26%. These shifts weren't price-driven; the balance between price segments remained constant, with luxury products accounting for 50% of category business, premium products 20%, prestige products 11%, and entry-level items 19%. Instead, they indicated a market transformation:

• The wellness concept has infiltrated every category, becoming the primary reference point for cosmetics shopping, including haircare. This shift blurs boundaries between historically "care"-focused categories and prompts questions about the global interpretation of "wellness" in each market.
• While niche and specialist brands fuel the fragrance market's growth, the makeup category faces disruption from major fashion players and celebrity-backed brands, challenging the dominance of specialist brands.

From Care to Wellness

Today's consumers seek more than just products for skin, hair, and scalp; they desire a holistic experience in 'care'. Despite declining market share, department stores are revitalising the skincare segment through enhanced services to improve consumer interaction and deliver authentic wellness experiences. Tryano (Chalhoub Group) is exploring the implementation of beauty cabins staffed by skin diagnosis experts. To effectively promote these new services, a blend of time-tested marketing techniques (CRM targeting, social media, influencer partnerships) and modern approaches (offering skincare treatments as gifts with purchase) is essential, mainly to attract younger clientele. In this landscape, prestige niche brands like Barbara Sturm, Augustinus Bader, Dermalogica, La Mer, and Sisley gain traction as customers engage with product trials.

A genuine sense of wellness also demands a fresh assortment: IADS members continuously seek brands offering self-care, personalisation, and creativity, aligned with ethical and community-centric values, tailored to their market segments. For instance, Boyner focuses on haircare, suncare, and serum-infused products, while El Palacio de Hierro emphasises men's and dermo-cosmetics.

IADS partner Nelly Rodi presented an exclusive selection of relevant brands in this context:

• Skincare: Ipsum Alii, Mimétique, Mtm Labo, Talm, Thisworks, and Megababe
• Haircare: Flora Lab, Fatboy, Crown Affair, Prose, and Pattern

Wellness is paving the way for new product uses and categories: In Turkey, Boyner observes a rise in renewable packaging products, while in Switzerland, Manor is tapping into the "beauty from within" trend by offering food supplements like Vital Protein collagen, which have become integral to customers' routines.

Fragrances: niche brands spearhead growth, raising questions on clustering

Niche fragrances lead the charge in department stores, with brands such as Creed, Maison Francis Kurkdjian, Amouage, Montale, Byredo, Le Labo, Armani Privé, YSL high-perfumery, Penhaligon's, and Parfums De Marly at the forefront. The market shows no signs of saturation, as Galeries Lafayette sees space being claimed by challenger brands like Parfums BDK, Matière Première, and Maison Crivelli. This diversity is crucial as department stores pursue new brands to differentiate themselves and boost foot traffic. NellyRodi presented its exclusive scouting of up-and-coming fragrance brands in this category: Perroy, Obvious, Vyrao, Borntostandout, and Dedcool.

Consequently, department stores must reconsider their fragrance department clustering strategies. Some are contemplating the creation of unisex, niche, prestige, and premium areas instead of traditional men's and women's sections. As customer preferences become more fluid, the conventional gender-based separation may be losing relevance in certain markets.

Makeup is stable with fashion newcomers

The category continues to grow in some department stores, maintaining a steady average market share, primarily due to lip and eye-related products. While established names like Chanel and Dior maintain their unchallenged dominance, other historical leaders such as MAC face increasing competition as the market welcomes new entrants:

• Fashion brand spin-offs: Rabanne, Prada, Gucci, Valentino, Loewe
• Celebrity-backed brands like Haus Labs by Lady Gaga and r.e.m.beauty by Ariana Grande

Next-generation brands are also emerging, as NellyRodi scouted:Obayaty, Fara Homidi, Good Weird, (M)anasi, and Florasis. Consequently, customers can anticipate significant changes in department store makeup floors in the coming seasons.

The Cosmetics, Beauty, & Wellness industry is undergoing dynamic shifts, propelled by the surging demand for niche fragrances and a consistent appeal for makeup, particularly in the lip category. Wellness now encompasses more than traditional beauty products as skin care evolves towards a more holistic, care-at-large approach that incorporates services and experiences. This transformation mirrors a broader consumer trend favouring personalised, inclusive, and ethically aligned products.

Access the PDF press release here:

IADS PRESS RELEASE: Cosmetics, Beauty & Wellness

Access the PDF press release, in French, here:

IADS Communiqué de Presse: Cosmetiques & Beaute

Vogue Business has published an article discussing the success, or lack thereof, in the luxury retail scene in Paris, France during the Olympics. The article explores the slower tourist traffic in the city and how that impacts luxury stores. The article quoted the IADS' GM, Selvane Mohandas du Ménil, who shared his thoughts on consumer behavior during this monumental time.

Vogue Business quoted IADS on luxury retail in Paris during the Olympics

Le Monde has published an article discusses consumer behavior in Paris during the Olympics. The article explores the fact that the influx of Olympic tourists are generally not participating in retail shopping due to tight viewing schedules and lack of purchasing power. The article quoted the IADS' GM, Selvane Mohandas du Ménil, who shared his thoughts on this phenomenon.

Le Monde quoted IADS on consumer behavior in Paris during the Olympics

Le Monde has published an article exploring the impact of the Olympics on various business sectors in Paris, including restaurants, retail, and transportation. The article quoted the IADS' GM, Selvane Mohandas du Ménil, who shared his thoughts on the shopping habits of the incoming Olympic spectators.

Le Monde quotes the IADS on retail in Paris during the Olympics

Inside Retail has written an article detailing the merger of Saks and Neiman Marcus and how this union could create a department store titan in a time where theres increased competition. Saks, known for its flagship store on Fifth Avenue in New York, and Neiman Marcus, with its iconic Dallas location, are expected to benefit from combined resources and customer bases. The article quoted the IADS' GM, Selvane Mohandas du Ménil, who shared his thoughts on the strategic implications of this merger for the luxury retail sector.

Inside Retail quotes the IADS on the Saks & Neiman Marcus merger

Fashion Network has reported on Falabella Retail's recent induction into the International Association of Department Stores (IADS). The Chilean company, recognized as the largest department store chain in South America, will be officially welcomed at the 65th General Assembly in Istanbul this November. The article highlights Falabella's significant contributions to global retail, particularly in enhancing omnichannel capabilities, loyalty programs, and private brand efficiency. The report also touches on Falabella's extensive history and current operations, serving 15 million customers across 103 stores in Chile, Peru, and Colombia.

Fashion Network reported on Falabella joining the IADS

**Falabella Retail, South America's retail giant and a global omnichannel pioneer, joins the International Association of Department Stores.

Falabella Retail, part of the Chilean multinational company Falabella S.A. Group, renowned for its cuttingedge omnichannel approach seamlessly blending offline and online sales, unwavering commitment to sustainability, and magnetic appeal to top regional talent, officially joins the IADS. This membership will be formalised at the 65th Association General Assembly in Istanbul this November.**

From humble beginnings as a tailor's shop in 1889, Falabella Retail has evolved over 135 years into South America's retail powerhouse. Today, it caters to 15 million customers, offering a curated selection of over 160 international, local, and exclusive brands, alongside a diverse range of private labels spanning fashion, technology, and home categories. Standout names include Sybilla, Basement or Americanino. Its network of 103 department stores across Chile, Peru, and Colombia forms the cornerstone of a sophisticated retail ecosystem, seamlessly integrated with digital platforms and financial services to deliver an unparalleled experience to South American shoppers, particularly the millions enrolled in its loyalty program.

In 2021, Falabella unveiled its crown jewel: a flagship store in Santiago de Chile's Parque de Arauco open-air mall. This retail behemoth, the largest in South America, stands as a beacon of sustainable retail innovation. Boasting LEED Gold certification from the US Green Building Council, the store achieves impressive energy savings of 31% and water conservation of 51% through innovative design and equipment, all while elevating the shopping experience. Sprawling across 25,000 square meters, it offers over 40 distinct retail experiences, including cutting-edge augmented reality installations and lightning-fast automated click-and-collect services. This flagship epitomizes Falabella's broader sustainability drive, which includes 39 LEED-certified stores across the continent and a robust commitment to circular fashion through its Taller F customization, repair, and transformation workshops.

Falabella's reputation for quality and creativity in its private labels is matched by its ability to attract top global talent. The group's unwavering focus on training and upskilling its 24,100 associates across Chile, Colombia, and Peru is exemplified by programs like Escuela F, which hones skills in product development, store management, and planning.

Ms Kamshim Lau, Executive Director of Lifestyle International (Hong Kong SAR) and President of the IADS said: "I am pleased to welcome Falabella Retail back to our esteemed association. As South America's largest department store chain and a global frontrunner in omnichannel sales, Falabella brings invaluable expertise and a rich history of excellence. We are excited to continue our collaboration and work together towards the growth and success of department stores worldwide!"

Mr Francisco Irarrazaval, Corporate CEO of Falabella Retail, said: "This alliance will allow us to share insights with the world's leading retailers, gaining a first-hand understanding of the latest trends and best practices, which will enable us to continue leading changes and responding to our customer's needs. This reinforces our commitment to put the customer at the centre of our decisions and our objective of having an active participation in addressing the current challenges of the industry worldwide."

By joining the IADS, Falabella Retail will contribute its unique insights to the rich tapestry of knowledge shared among the world's leading department stores. Within the IADS framework, members collaborate to craft strategic and practical solutions to key industry challenges, from enhancing omnichannel capabilities and loyalty programs to optimizing private label efficiency and driving broad-scale innovation.

Access the PDF press release here:

IADS PRESS RELEASE: Falabella joins the IADS

Access the PDF press release, in French, here:

IADS Communiqué de Presse: Falabella rejoint l'IADS

Inside Retail has written an article detailing Central Group's aquisition of KaDeWe following the €1 billion acquisition of the KaDeWe property in Berlin's most famous shopping street Tauentzienstraße, from Signa Prime Selection AG last April. Central Group has agreed to acquire the rest of the KaDeWe Group portfolio – Alsterhaus in Hamburg and Oberpollinger in Munich. The article quoted the IADS' GM, Selvane Mohandas du Ménil, who shared his thoughts on the strategic investment by Central Group in Thailand.

Inside Retail quotes the IADS on Central Group's aquisition of KaDeWe

**Bloomingdale's, America's only nationwide, full-line, upscale department store, joins the International Association of Department Stores.

Bloomingdale's Inc., a global retail icon celebrated for its distinctive merchandising strategy, store experience, and brand positioning, officially joins the IADS. This membership will be formalised at the 65th Association General Assembly, which will be held in Istanbul this November.**

With a rich history spanning over 150 years, Bloomingdale's has carved a unique niche in the global retail landscape. The brand is internationally renowned for its exclusive product offerings, innovative customer service, and unforgettable culturally relevant shopping experiences. As a brand, Bloomingdale's has fostered enduring relationships with its clientele, including millions who are part of the retailer's Loyallist program.

Recognized globally for animation and trend-driven fashion, Bloomingdale's department stores and e-commerce channels carry women's, men's and kid's apparel and accessories, cosmetics, and home goods, inclusive of furniture, differentiating them within the US landscape.

The flagship store is located in Manhattan, New York on 59th Street and Lexington Avenue. From the subway stop on the lower level to the well-known brown kraft-paper "Big Brown Bags" to the many TV shows and movies that have featured the brand, it has become an iconic part of the fabric of New York. The company now operates 32 full-line stores, 21 outlets, and 3 Bloomies locations in the United States. Bloomies, a newly introduced small format concept, provides a casual, contemporary, and highly curated experience featuring an edit of top brands in a broad range of men's and women's categories, including apparel, accessories, beauty, giftable products and more. In addition, Bloomingdale's has an international presence with locations in Dubai and Kuwait.

The company is also deeply committed to building a more equitable and sustainable future through its B the Change program, a roadmap based on three pillars – environmental impact reduction, social inclusion, and youth development – actioned through campaigns, grants, fundraising activities, volunteer opportunities and more. In 2023, Bloomingdale's Inc. supported 96 organisations in the US and donated more than $2.7 million to charity partners./nbsp]

Ms Kamshim Lau, Executive Director of Lifestyle International (Hong Kong SAR) and President of the IADS said: "It gives us great pleasure to extend a warm welcome to Bloomingdale's Inc. as a valued member of the IADS. With an extraordinary heritage spanning over 150 years, Bloomingdale's has successfully positioned itself as a distinguished hub for luxury shopping in the United States, Dubai and Kuwait. We look forward to having Bloomingdale's participate in the various activities and exchanges of the IADS, contributing towards our drive to deliver customer excellence and quality services in the department store industry."

Mr Olivier Bron, CEO of Bloomingdale's, said: "Bloomingdale's is thrilled to officially join the esteemed IADS. This partnership serves as an opportunity to share, develop, and enhance our collective knowledge of the Department Store business with valued business peers internationally. We are very much looking forward to the great work and necessary collaboration ahead."

By joining the Association, Bloomingdale's will contribute to the fruitful exchanges taking place between leading department stores in the world within the framework offered by IADS, where members come together to bring strategic and concrete answers to questions ranging from real estate strategy to e-commerce profitability, organizational efficiency, private label profitability, relationships with international brands and the evolution of customer expectations.

Access the PDF press release here:

IADS PRESS RELEASE: Bloomingdale's joins the IADS

Access the PDF press release, in French, here:

IADS Communiqué de Presse: Bloomingdale's rejoint l'IADS

The Fashion Network has written an article on what home & decor have done to adapt to consumer preferences post COVID-19, based on IADS' findings. The article quotes findings from the associations merchandising meeting on the home & decor sector held last February that covered brands, categories and products that are winning in retail thanks to strategies outlined in the takeaway report including Private Labels and sustainable offerings.

Fashion Network echoed IADS' findings on Home & Decor in retail

WWD has written an article on what home & decor categories are performing best, based on IADS' findings. The article quotes findings from the associations merchandising meeting on the home & decor sector held last February that covered brands, categories and products that are winning in retail thanks to strategies outlined in the takeaway report including Private Labels and sustainable offerings.

WWD covered IADS' findings on the Home & Decor sector

StoreBrands has written an article covering findings in IADS' latest report on the adapting Home & Decor sector in retail. The report reviews the associations recent merchandising meeting in February that shared insights on what home & decor categories are performing best. The report reviews the brands, categories and products that are winning in retail thanks to strategies outlined including Private Labels and sustainable offerings.

StoreBrands highlighted IADS' report on the adapting Home & Decor sector in retail

"There is no place like home," and customers are well aware of this. Despite challenging inflation levels and the difficulty of growing the share of sustainable products, the Home & Decor category proves remarkably resilient and successful for department stores.

In a difficult inflationary worldwide context, the Home and Decor business has deftly navigated a shift in consumer focus after three years of post-COVID enthusiasm for design and furniture in department stores. The astute introduction of new segments, such as kitchen appliances and tableware, and the perseverance on popular ones like home scents and private labels, have allowed department stores to adapt, instilling confidence in their strategic agility.

On average, the Home & Decor category's relative share of total turnover for IADS members decreased from 16% in 2022 to 14% in 2023. This correction comes after three years of growth as customers sought to equip their homes in difficult times of remote work and difficulty going outside. However, this trajectory is healthy as, while the numbers show the impact of inflation in many markets, they do not reflect the change in the nature of what is being sold: fewer expensive, bulky items, and many more affordable, smaller ones. In times when logistic costs are increasing, the positive impact on the overall company's margin is clear.

Home Accessories are, on average, the strongest segment with 48% of the category business, followed by Household Appliances at 22%, Electronics at 15%, Furniture at 10% and other products (gifting, art, stationery, and pet-related products) at 4%. E-commerce represents 27% of the total category business, a stable number that does not show the significant market shifts at work: while online has remained stable or decreased in Europe, it has significantly increased in other regions (Middle East, Asia, South America).

The 2023 winning combo: home scents, kitchen appliances, tableware and private labels

In terms of sales dynamics, three trends stood out last year.

Most IADS members achieved remarkable success with home scents. Aromatherapy, scented candles, and all forms of home scents have been remarkably growing at El Palacio de Hierro, Tanagra (from Chalhoub Group) and Breuninger. For many department stores, the scented candle business was driven by well-established and recognized best-selling brands, such as Baobab, a great performer in every market considered.

The second trend noted was the success of home appliances. That category ranges from coffee machines, a very successful category at Boyner and Magasin du Nord, to personal care appliances that performed extremely well at Sogo thanks to Chinese customers returning to Hong Kong, or water purifiers and carbonators (with Aarke standing out as a noteworthy brand in many northern European markets). In France, Galeries Lafayette saw great results with affordable tableware brands such as Tokyo Design Studio, Popolo and Serax: their constantly updated offer allows the display of new products to customers on a very regular basis. Tanagra and Sogo saw a great increase in high-end tableware.

The third trend noted was the renewed focus on private labels. In most IADS members' brand ranking, private labels score high. New products, new categories and even new brands were developed, and marketing investments were made to match the brands' positioning and quality with their perception by customers. Much is at stake: the private label business can represent up to 35% of the total sales in the category, and the few IADS members not already operating such private labels are planning to do so in the next 3 years.

What's cooking for 2024: new product categories and brands to watch

Through its many events ranging from mid-segment to luxury brands, the Milan Design Week showed that interesting developments are in the pipeline to grow the Home & Decor business. Tanagra continues developing fashion brand home collections such as Dolce & Gabbana, Versace and Missoni and works with Assouline to push coffee table books.

In Europe, the focus is on kitchen appliances and tableware, with brands such as Graef, a German high-end coffee grinder label, and the Portuguese ceramics Bordallo Pinheiro. In the rest of the world, Boyner plans on opening tech and electronics areas in each of their stores, which are all being currently upgraded as per the retailer's new concept. On its side, Sogo will develop bonsai trees, a category appealing to middle-aged customers.

To support IADS members in their brand scouting, NellyRodi, a partner of the IADS, presented its exclusive selection of up-and-coming brands made specifically for the Association's members:

• Furniture: Frama, Ruda Studio, Dooq, Situer Milano, Potiron.
• Tableware: R+D.Lab, Amabro, Pinoli, Kinindustrie, Aya & Ida.
• Decoration: Maison Deux, WL Ceramics, Schneid Studio, Warren & Laetitia, Design By Us, Oblure, Deya, Henry Dean, Y.S.M. Products, Courant Sauvage, Taith.

• Household appliances: Create, Aarke, Beautiful.
• Tech: Gingko.

Department stores adapt to inflation, one of the many obstacles to growing sustainable products

Consumers spent a lot on their homes during COVID-19. With so much time spent at home, they indulged and renewed high-price products such as furniture, sofas and bedding, categories that are currently struggling overall. Then, due to inflation, consumers experienced a strong purchasing power decrease and reduced discretionary spending. To date, they remain more cautious and have cut back on impulse buying. This is why some IADS members have developed more entry-level products while also ensuring not to list high-price items that would only sell with a discount. What makes things difficult is that when consumers consider it a long-term investment, they continue buying expensive products such as coffee machines.

For that reason, while there is no universal recipe for maintaining full-price sales as the Home & Decor category's nature is diverse for every member, to focus on full-price sales, IADS members balance their offer construction between uplifts from promotion-driven products and categories or brands which are never discounted.

When it comes to sustainability, even though customers are becoming more accustomed to the topic, acceptance grows slowly as they are not ready to pay the real price of responsible products. As such, retailers find a compromise by reducing margins on sustainable products to maintain acceptable prices and having higher margins on other products. On the other hand, retailers face issues when it comes to increasing the share of responsible products. Some categories are more advanced than others: thanks to multiple labels and certifications, sustainable home textiles could soon reach 80% to 90% of the product offer. On the contrary, other categories have issues with offering more than 10% of sustainable products: lighting is a difficult category as there is no certificate for recycled metal. The situation is the same with wooden items: the only label, the FSC, is not considered relevant anymore. As a result, it's difficult to convey a unified message about sustainability to customers.

The past year has presented both challenges and opportunities for the Home & Decor categories, reflecting broader economic trends and shifting consumer behaviours. Despite a slight decrease in turnover share, department stores have demonstrated resilience in the face of inflationary pressures. Successful strategies have centred around private labels, specific product categories and onboarding new brands to meet evolving consumer preferences and drive growth. Challenges persist, particularly in navigating inflationary pressures and increasing the share of sustainable products.

Read the full press release below:

IADS PRESS RELEASE: Home & Decor

Beaux Arts has written an article on how department stores have transformed society, citing quotes from Selvane Mohandas du ménil, GM of IADS. The article article discusses the invention of the department store in Paris, France amid Baron Haussmann's architectual revamp of the city in the mid-19th century. The article quotes the IADS' take on the department store approach and the importnce of their role in the monumental architecture, theatrical decor, and the experience of Paris.

Beaux Arts echoed IADS' take on how Department Stores transformed society

Fashion United has written an article based on a talk hosted by IADS' General Director, Selvane Mohandas du Ménil, with Michael Ward, managing director of Harrods (London), and Nicolas Houzé, CEO of Galeries Lafayette (Paris) at this year's World Retail Congress. The article reports on subjects and points raised at the convention by IADS during the conference on challenges that they are facing in the current retail landscape and the inportance of adaptability and prioritizing the right consumers.

Fashion United article 

Fashion United has written an article based on IADS' insights on department store success shared at this years World Retail Congress. The article reports on subjects and points raised at the convention by IADS' General Director, Selvane Mohandas du Ménil, during a conference with two major players in department store distribution, Michael Ward, general director of Harrods (London), and Nicolas Houzé, CEO of Galeries Lafayette (Paris), where they shared their respective experiences and valuable insights.

Fashion United article 

The Fashion Network has written an article based on IADS insights on department store loyalty programmes. The article reports IADS' findings that department stores are now moving towards less financially tangible rewards due to the complicated nature of loyalty programmes and  difficulty of finding a sufficiently attractive discount level.

Fashion Network article 

IADS press release - Loyalty Programmes

The importance of being earnest: customers expect more than points for their loyalty. This is why Department Stores are revamping their loyalty programmes to bring clients the ultra-personalized connection they crave, by evolving their corporate culture and organisation to become even more customer-centric.

Technology evolution and recent changes in customer behaviour have encouraged the growth of large-scale loyalty programmes, allowing department stores to foster increasingly large communities of customers accustomed to point-based and tier-based systems. Going beyond this approach, many retailers now consider persona-based programmes as they recognise the diversity in needs and behaviours across customer segments. More than points, non-tangible perks, such as exclusive access and personalised experiences, create emotional bonds that drive deeper customer engagement. This evolution comes with a significant challenge: the needed changes in internal stakeholders' mindset to infuse customer-centricity and develop customer data usage across the entire company.

Many retailers, including IADS members, have point-based programmes that often include loyalty-based discount systems: the more loyal customers are, the better deals they will have in the future. Striking the right balance between customer expectations and brand integrity is crucial. It is key to make these "earn points and burn them" programmes as appealing and engaging as possible while also considering customers' natural expectations to enjoy discounts when becoming members without compromising the retailer's brand name.

This type of point programme can frustrate clients as it can sometimes be difficult to understand, leading customers to feel they are not making the most of it. This issue is particularly pronounced in non-food retail, which, by definition, takes place less often than grocery shopping. The value of points can be hard to see when there is a significant delay between collecting points and using them. Also, there is no real consensus on the best way to grant points: encourage customers to buy more, or to come more often?

A solution to overcome this issue could be to offer straightforward discounts. Department stores are understandably reluctant to take this extremely costly course. It could initiate a very painful race to the bottom: finding the right and appealing enough discount level is difficult. Consequently, while generalised and widely adopted by customers, point-based programmes create friction, as retailers are justifiably wary about their margin level and brand image.

Loyalty with a vengeance: from points and tiers to AI-powered personas

Drawing the conclusions of such a situation, and to be in tune with their customers' expectations, the Manor loyalty programme, myManor, is based on personas, with customer communications which are tailor-made thanks to advanced data analysis tools (specific demographics, affinities, algorithms, regional clustering…). While El Corte Inglés does not have a branded loyalty programme for now, the retailer can refine its relationship with its customers thanks to a detailed understanding of their affinities, allowing it to define analytical drivers powering a value-based strategic segmentation.

However, with such an approach, complexity can be around the corner. As pointed out by Boyner with their Hopi payment app (acting as a loyalty programme), which is particularly advanced in that field, data is critical to identify customers, learn about their preferences, achieve customer engagement, and personalise the relationship to create greater value. Since they have access to more data, retailers must make choices and decide which one they really need to engage and retain customers efficiently. The available data gives access to an ocean of possible customer segmentations, all made according to an infinity of seemingly relevant criteria, and clear choices need to be made to make sure this does not increase organisational complexity at the expense of efficiency and, most importantly, profits.

This is why IADS members expect Artificial Intelligence (AI) to offer soon new and simple solutions to send hyper-personalised messages to each customer entering their store or accessing their website, once there is an alignment on available technology, regulation clarity, and the ability to establish safeguarding procedures: Air Canada's recent misfortune with a chatbot giving bad advice to travellers has been seen as a warning by all retailers in the world.

The rise of non-tangible benefits: a must-have to create an emotional bond with customers.

Department stores agree that customers highly appreciate non-tangible benefits and that they should develop further in the future. This does not systematically include out-of-this-world perks, as clients value anything that eases their lives. For instance, all benefits related to status (lounge access, pre-sales, special seats) are increasingly important for The Mall Group's M Card holders. Also, in Mexico, free parking and the distance to the store depend on the customer's tier at El Palacio de Hierro.

At the same time, department stores are exploring more personalised benefits. For instance, El Palacio de Hierro "Palacio" payment cardholders are treated to a bottle of wine, a meal at one of the retailer's restaurants, or a birthday gift, all of which create an emotional bond. The most difficult is to find the right way to communicate such perks, as it takes effort and resources to convey them: most customers remain paradoxically unaware of these benefits.

Others go beyond practices often found in retail by seeking inspiration from other industries, such as banking or air travel. While it is now common practice to have priority checkout according to the status, some IADS members are now considering offering top-tier customers airport fast-track access. Others are considering free digital subscriptions to third-party services, such as Spotify, as an interesting perk: marginal cost is low, and customer appreciation is high.

Finally, gamification is also a way to create a connection: the Mall Group offers Augmented Reality (AR) in-door navigation features in its customer app. Customers can play games or click on objects to access special deals or product offers and win discount coupons.

From product-centricity to customer-centricity: the necessary company culture shift

Department stores have always been product-centric businesses. Now that they must become customer-centric, they are going through a complete and complicated change of mindset and culture, which must come from the top of the organisation (CEOs are often involved in these moves). To encourage the change, some IADS members now generalise the Net Promoter Score (NPS) into everyone's bonus scheme: the KPI becomes a topic of discussion as it directly impacts compensation. Some go even further and consider linking compensation to indicators such as the Customer Lifetime Value (CLV) or retention rate, on top of the usual revenue and profitability KPIs.

To gain internal traction and support, all stakeholders (managers, teams…) must clearly see the benefits of the loyalty programmes. The Mall Group communicates on the incremental revenue generated through the M Card. Also, since their compensation depends on it, accessing the loyalty data easily and simply is crucial: El Palacio de Hierro's HR team is involved in sharing data and helping staff interact more efficiently with customers. Manor has regular in-store trainings on the programme benefits, as involving the staff and making sure they understand how the programme works is a game-changer.

Department store loyalty programmes are bound to evolve as a differentiator from competition and a magnet for loyalty. If rewards are not attractive enough, customers may lose interest, especially if the relationship with the retailer is only transaction-based. This is why customer-centricity is key, which involves deep changes in company cultures. This also implies focusing on leveraging customer data more effectively, ensuring that insights inform decisions across the entire organization. It comes at a cost in terms of investments for market research, customer data analysis, and adaptation to customer needs and feedback.

Read the full press release below:

IADS PRESS RELEASE: Loyalty Programmes

Read the full press release, in French, below:

IADS Communiqué de press: Programmes de fidélité

The International Association of Department Stores (IADS) has chosen Elisabetta Falco Beccalli to lead its Innovation and Communications efforts, succeeding Mary Jane Shea who is leaving the organization for personal reasons at the end of the month. Ms. Falco Beccalli brings over 15 years of international fashion business development experience to the role.

"We would like to thank Mary Jane for her dedicated and energetic contributions. We extend our heartfelt wishes for her success and fulfilment in her new endeavours," stated IADS President Kamshim Lau. "As Mary Jane departs, we are delighted to welcome Elisabetta, who will continue to build upon Mary Jane's many achievements. With her deep expertise in the fashion industry and international background, Elisabetta is ideally positioned to spearhead our innovation and communication initiatives going forward."

Ms. Falco Beccalli, 43, held senior sales positions with premier fashion houses including Yves Saint Laurent, Theyskens' Theory, Theory and Helmut Lang. She was instrumental in launching Theory in Southern Europe, running its inaugural showroom during the brand's rapid growth years.

Hailing originally from Italy, Ms. Falco Beccalli earned a bachelor's degree in communications from Villanova University in the United States. She has lived abroad extensively including in Europe, Asia and the USA. In charge of Innovation and Communications, Ms. Falco Beccalli will be responsible for identifying new technologies to help the IADS' member department stores address pressing industry challenges. This will include spearheading research initiatives, like the Association's annual White Paper, – with the latest edition about Retail Media released earlier in January-, the Global Department Store Monitor, - with the latest edition released earlier in February-, and creating new partnerships with relevant companies, coming on top of the existing cooperation with NellyRodi in trends identification, The Style Pulse in scouting new brands, Retail Hub in tech sourcing and RH-ISAC in cyber defence.

Following the 2020 pandemic episode, the IADS has gone through a significant reinvention in terms of responsibilities and services brought to its department store members. This transformation has been made possible thanks to the involvement of a new, younger team, with the average age of the team members decreasing by 13 years. This transformation was made visible to the world last December when Ms Kamshim Lau, 36, was elected the first female president in 96 years of IADS' existence. Such an appointment was a testament to the IADS members' agility and commitment to addressing the most pressing challenges in retail by collaborating and relying on the best talents available.

"I am thrilled to be taking on this dynamic new role with IADS," said Ms. Falco Beccalli. "I look forward to helping such an expert global organization drive innovation in the retail space during this time of immense change and possibility."

Read the full press release below:

IADS PRESS RELEASE: Italian Fashion Executive Appointed to Lead Innovation for the IADS

Read the full press release, in French, below:

IADS Communiqué de press: L'IADS nomme la tête de son département Innovation

The Financial Times has published an article written by Christopher Knee, an Honorary Advisor at the International Association of Department Stores (IADS). This letter discusses the challenges faced by department stores, particularly in the context of real estate ownership and investor strategies and suggests that many department store closures and difficulties stem from real estate owners leveraging their properties for profit rather than from inherent issues with the department store model.

Financial Times article