{"id":11549,"date":"2024-01-20T07:53:58","date_gmt":"2024-01-20T07:53:58","guid":{"rendered":"https:\/\/dmsretail.com\/RetailNews\/saks-plan-to-bring-luxury-to-online-shoppers\/"},"modified":"2024-01-20T07:53:58","modified_gmt":"2024-01-20T07:53:58","slug":"saks-plan-to-bring-luxury-to-online-shoppers","status":"publish","type":"post","link":"https:\/\/dmsretail.com\/RetailNews\/saks-plan-to-bring-luxury-to-online-shoppers\/","title":{"rendered":"Saks’ Plan to Bring Luxury to Online Shoppers"},"content":{"rendered":"

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In a presentation at the ICR Conference in Orlando, FL last week, Marc Metrick, CEO of Saks, a digital platform for luxury fashion in North America, discussed winning over digital-native consumers and the concept of accessible luxury, among other topics.<\/p>\n

Metrick is a self-described “lifer” at Saks, having spent more than half his life at the company. He was named CEO of Saks Fifth Avenue in 2020, and was at the helm when the Saks’ e-commerce business was split off from parent company Hudson’s Bay Company in 2021. Here are some highlights from his interview at ICR.<\/p>\n

On Splitting Off the E-Commerce Business<\/h2>\n

“We split for the consumer,” Metrick said. “The luxury consumer was finally moving online. We picked up our center of gravity and moved it to the online business.”<\/p>\n

Metrick noted that this wasn’t entirely different from the origins of Saks Fifth Avenue, with the company’s first store located on 6th Avenue in Manhattan’s Herald Square before the company followed the consumer and moved uptown to 5th Avenue.<\/p>\n

Acquiring the Digital-Native, Luxury Customer<\/h2>\n

“We were moving from a legacy department store to a website that has been around for one-and-a-half years,” noted Metrick. The brand awareness that Saks’ physical store presence had engendered was an advantage during this transition. And part of the strategy was redefining the “luxury shopper.”<\/p>\n

“I don\u2019t define the luxury consumer as rich people,” Metrick said. “It\u2019s an end consumer, and there are those qualified for luxury purchases but they need to make decisions [in their spending habits]. We need to get them and build relationships over time.”<\/p>\n

Metrick noted that because of its strong brand awareness, Saks benefits from a much lower customer acquisition cost (CAC) than its digital pure-play competitors.<\/p>\n

Growth vs. Profitability<\/h2>\n

The first chapter of Saks’ digital story is growth with a new hierarchy of KPIs, said Metrick. He noted that running a department store is very different than running a pure-play. Chapter two is about efficiency and scale.<\/p>\n

“We needed to remain profitable and get the most margin as possible,” Metrick told the audience. “Chapter three is international expansion.<\/p>\n

“Profitability was always going to be important and needed to be there,” added Metrick. “It\u2019s changing for everyone else, leveling the playing field. The pure-plays operated without regard to profits. The consumer didn\u2019t care if the pure-plays made money.”<\/p>\n

Luxury in 2024<\/h2>\n

“She’s an ‘and or or’ customer,” Metrick explained. “You have the core luxury person that’s entrenched in her life. Then you have the ‘or’ customer that has to make choices to buy luxury.”<\/p>\n

As for the luxury market in 2024, Metrick said that Saks is starting to see a little bit of a lip. He expects a slow start to the year for the luxury customer, but then demand will build and the year will finish strong.<\/p>\n

“Our job is to drive consideration with the high awareness that we have,” Metrick said. “That comes from the customer experience that we give on the website. We\u2019re never going to be in a perfect end state. I\u2019m always going to say we\u2019re in the sixth inning.”<\/p>\n<\/div>\n