I was too early with Suitsonsale.com in 1999. Great site, all Flash based, but people were too scared to enter their credit card numbers. Now I’m back online after 30 years in physical retail with SUITCAFE.COM. I come from the luxury sector of menswear and I know, as Macy’s must also know, that no matter what the economy or cycle/trend the wealthy shopper always has extra capital to spend.
In regards to your points, I agree with you on point “0”. Kids these days do not know a time without a smartphone, digital photo and WiFi. If you think about it, their entire lives from birth until whenever will be documented online. No need for scrapbooks.
“1”, You’re correct in that the internet is still very young, but moving at light speed. It seems as though the simplest of ideas are the ones that can shine through the fray. The three rules of retail, L,L,L, are still true, but a digital presence can help drive traffic to a store even if it is off the beaten path. Case in point could be Suitsupply. Their first NYC store is on a 2nd floor downtown. Their flagship NYC store has a small side street entrance on 59th off Madison Ave, but goes up to an 8,000 sqft 2nd floor space. I don’t see Madison Ave businessmen as their customer (I was on 51st and Madison for many years), but they are saving a bundle in rent. Porsche Design on the corner of 52nd and Madison is paying $3 million a year in rent. They don’t have enough merchandise in the store to have enough sales to pay those numbers, but that’s another topic completely.
“2” I agree somewhat again and Aldo is very good example. Their iPad stations set up around their stores show their entire inventory by SKU. If the salesperson doesn’t have the size in the store, they make a beeline for the iPad, find the size and color, ask you to pay today and will send you the correct pair you want right away. Simple, clean, easy. I don’t have to carry an annoying shoe box home. There is still a certain feeling about buying clothing in a store — touch, feel, drape, fit for the consumer and the power of making additional sales with accessories for the store/salesperson.
“3” Yes, Amazon does have private label (EastDane and more) as they recognize there are big profits to be made there. When you own your own label, the consumer has nothing to compare to and only one place to buy — a captured audience of sorts. I was surprised they closed their MyHabit division. It was the best and cheapest place to by brand name clothing online for men and women. Nordstrom has been knocking on doors of menswear brands, looking for that big hit — Bonobos, Trunk Club, Combat Gent, but I think they all have flaws. Amazon is surely an amazon of eCommerce. To think it started with books.
“4” I first became aware of Alibaba in early 2000s when it was B2B. I was never enamored with it since I was looking for European products at the time, but you are right that it is a behemoth and Amazon and others will have to watch their backs.
“5” Terry Lundgren is a very dynamic person. I met him once on the main floor of Bloomingdale’s if only for few moments and complimented him on all the new changes he was configuring. I was impressed at the new Macy’s shoe department. Taking a page from Apple retail, after choosing shoes, the salesperson goes onto an iPhone, scans the code, and a runner comes out from the stock room with your shoe boxes. Gone are the days of the disappearing salesperson in a maze of shelving behind a dark curtain.
“6” I agree here. As I mentioned above, Nordstrom has already been in this space and Macy’s needs to play catch-up.
Great assessments Sabir. Be well.