Luxury Fashion Brands See a Future on the Retail Floor, Not Just Online

September 29 [Sat], 2012, 18:54
The perceived slump in sales of luxury goods has top fashion brands considering all sorts of strategies to pump up consumer engagement.

Burberry has just transformed its London flagship store into a digitally-enhanced shopping experience that brings to life its Burberry World online store, following on the heels of Audi's flagship Audi City digital retail experience in London. This may be just the beginning Burberry Outlet of a trend to re-engineer the traditional retail store environment so that it entices and excites consumers who would otherwise choose online shopping.

Indeed, fashion brands are more committed to sales on the retail floor than one might think. Brands including Coach, Crocs, and Tumi are planning to open more stores of their own, but they haven't given up on the department store, either. At last week's Reuters Retail and Consumer Summit, Richard Dickson, CEO of branded businesses at Jones Group, stated that "We believe in the department store. Department stores have done a brilliant job continuing to energize and re-invent themselves in order to stay relevant."

With a portfolio of fashion brands that includes Anne Klein New York, Gloria Vanderbilt, Jones New York, and Pappagallo, Jones relies on its retail partners to help promote its brands. John Idol, CEO of Michael Kors, added, "There's a customer who's very dedicated to cheap burberry scarves shopping at a Macy's or a Nordstrom or a Dillard's or a Lord and Taylor and that customer may or may not shop inside a specialty store."

Reuters cites Macy's as an example of a retailer that has gone through a significant makeover by focusing on fashion, with a $400 million makeover leading to the soft opening of the "world's largest shoe floor" (boasting more than 300,000 pairs of shoes) last month. The new department store trend is to cater to individual labels and become "houses of brands." What's more, Reuters reports, the new Gucci store opening at Macy's New York City flagship this fall will be "its biggest location aside from its own flagship."

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