Apparel retailing used to be about luring celebrities and celebrity designers to create clothing lines exclusively for your store: Jason Wu for Target, Jennifer Lopez for Kohl's, P. Diddy for Macy's.
Lately though, retailers seem to be inching away from flash and sizzle in favor of authenticity and fashion purity. Less Milan and more Main Street.
Last month, Target announced it would launch '"The Shops at Target," in which the retailer would twice a year feature exclusive merchandise from a rotating cast of five boutique shops across the country.
Target made it clear that it was not merely selling product but rather the shops and owners themselves, each of whom boast unique stories, personalities, and clientless. The retailer sent people to secretly scout out the shops for about a year before finally pitching the shop owners.
Now Macy's, H&M, and Saks Fifth Avenue are getting into the act--albeit in a less subtle way. The three retailers will participate in "Fashion Star," a reality-based competition set to debut on NBC in March.
Every week, the show's largely unknown contestants, including several boutique owners, design clothing lines, which are featured in a fashion show. Then the retailers' buyers--Caprice Willard from Macy's, Nicole Christie from H&M, and Terron Schaefer (cool name!) from Saks--decided whether they want to purchase the collections.
If they bite, the retailers will immediately start selling the clothing in stores after the episode.
This will be an interesting experiment. I thought Target selling stuff from five boutiques twice a year was tough. But the Fashion Star retailers' timelines are even more compressed. It can't be easy selling a different clothing line across the country every week based on a television show though we don't really know how much product retailers are ordering.
Target, though, does not have the luxury of a television to hype its boutiques. The retailer must find a way to sell local products on a national scale.
Just like iTunes selling American Idol performances after the show, Fashion Star retailers enjoy a built-in marketing machine within the television show.
I doubt the retailers will generate much sales though they could land an unexpected hit. But generating sales is not really the point.
Like Target, the Fashion Star retailers want to create excitement and buzz and give customers a reason to enter their stores at a time when it has become much easier to buy whatever you want over the Internet. Unlike The Shops at Target, which will be available online, fans apparently can only purchase Fashion Star clothing in stores.
Here's a sneak peek of the show:
NEW YORK – Did you know that Store 3.0, the next-generation retailer that seamlessly combines old-fashioned physical stores with websites, mobile devices and social media, is located in Duluth?
Neither did I.
Here at the National Retail Federation’s annual conference, retailers are pondering a rather existential dilemma: how to position brick-and-mortar stores in an increasingly Internet-driven future.
“We have new retail rules,” said Alison Paul, vice chairman and U.S. retail & distribution leader at consulting firm Deloitte. “The store is not dead. Stores have become a part of a much more complex ecosystem.”
Rare is the store that can strike a harmonious balance between physical and digital.
But they apparently do exist. To prove it, the NRF trotted out David Jaffe, CEO of Ascena Retail Group Inc., which owns Dress Barn, Justice, and Duluth-based Maurices. Jaffe spoke warmly of Maurices, a women’s retailer that caters primarily to shopping malls and small towns. Founded in 1931, Maurices boasts 750 stores in 44 states.
While Maurices may operate in small-town America, the chain is a decidedly 21st-century retailer, one that is especially fond of social media.
To celebrate the launch of its partnership with designer Christopher Straub from “Project Runway,” Maurices recently threw a coming-out party at the Mall of America streamed live on YouTube and featured real-time Twitter feeds on a large screen.
Today, traditional stores account for 91 percent of all retail sales, according to Deloitte. Five years from now, that number will shrink to 63 percent. For retailers, the obvious strategy is to grow both physical and online stores. Easier said than done.
Some retailers, like Target Corp., excel at running stores but are still working to develop the same pattern of success when it comes to online retailing. Others such as Best Buy fare better with new technologies, but their physical stores suffer from the perception they are merely “showrooms” for online merchandise.
At Maurices, the company created what it calls Hometown Sound, a contest that allows customers to vote via a special website for promising bands that will perform at the South by Southwest music festival. This year, the retailer will host a pop-up store at the festival.
Maurices also asked customers through social media to identify people from small towns who could model its clothing. At the same time, the retailer has invested in its physical stores, designing more appealing dressing rooms and developing an electronic loyalty card called Take 10.
“We don’t care if [customers] go online or to the store,” Jaffe said. “Our best customers will do both. It’s not either/or. It’s and, and, and.”
Thomas Lee • 612-673-4113
No one really wants to be called cheap. Price savvy, yes. Frugal, maybe. We'd like to think we possess the taste if not always the money for the finer things in life.
So how do we explain the shrinking pool of large format luxury retailing in the Twin Cities, a region that actually enjoys good incomes along with affection for art museums, concert halls, and theater?
Dave Brennan, a professor of marketing and co-director of the Institute for Retail Excellence at the University of St. Thomas, described Twin Cities shoppers "falling back" from upscale stores.
Case in point: Bloomingdale's is leaving the Mall of America after 20 years. Saks Fifth Avenue converted its downtown Minneapolis location into a lower priced Off 5th Ave format. Neiman Marcus has also struggled in downtown Minneapolis.
Brennan thinks two factors are in play, both cultural.
1. Twin Cities shoppers are not as fashion forward as their counterparts on the coasts.
Nothing new with this theory. Fashion trends seem to take their time spreading from the coasts to the Midwest though social media seems to have shorten the trip. Take Missoni. Target Corp. introduced Missoni before New York's Fashion Week in September and the collection subsequently sold out the first day it was introduced to the Twin Cities the following week.
2. Twin Cities don't spend as much on expensive items.
A little bit of that Lutheran frugality, eh? Perhaps.
There are some reasonable explanations why Bloomingdale's didn't succeed at the Mall of America. The store was much too big. Even the best retailers would find it challenging to squeeze enough sales out of a three level, 210,000 square foot store.
As for Saks and Neiman Marcus, retailing has always been problematic in downtown Minneapolis.
But Brennan may be onto something. Luxury retailing as whole enjoyed a strong 2011, which makes Bloomingdale's struggles in Minnesota all the more atypical.
The MOA has also been generating record sales and traffic, mostly due to its Nickelodeon theme park and upper income shoppers.
"If [Bloomingdale's] couldn't make it at the Mall of America, I don't think they can make it anywhere in the Twin Cities," Brennan said.
Even Sears, which announced recently it will close over 120 stores because of poor sales, decided to keep its Minnesota stores, including the one at MOA, open. Sears!!!
Struggling women's apparel chain Christopher & Banks is closing 100 stores by the end of the month but only one in Minnesota.
Bon-Ton Stores, another struggling department store chain, is looking to open more Herberger's in the metro area.
Here's another theory. Minnesota fueled the dominance of the discount format with Target. More specifically, the Minneapolis-based retail giant pioneered the concept of "cheap chic," the idea that shoppers can buy trendy, fashion forward merchandise like Missoni at prices considerably lower than a luxury department store.
In fact, "Chez Tarjay" did it so job so well that local shoppers have fully embraced Target's mantra: "Expect More. Pay Less."
Perhaps we should adopt that phrase as our new state motto.
Macy's Inc. said Tuesday that it will close four Bloomingdale's stores, including the Mall of America location, beginning in early spring. The closings will take place over a period of ten weeks.
The retailer will also shutter Bloomingdale's stores in Atlanta, Oak Brook, IL, and North Bethesda, MD.
The Mall of America location will close in mid March. About 127 full time and part time workers will lose their jobs. The mall said it would add at least four fashion retailers to fill the space.
In a statement, CEO Terry Lundgren said stores slated to close "did not meet performance requirements."
"We continue to be committed to maintaing a healthy portfolio of stores that allow us to focus on growth from our best and most productive locations," Lundgren said. "This requires us to make some difficult decisions to close stores that no longer meet our performance requirements, as well as to open stores where we opportunities."
The company also said it would close five Macy's stores, though none in Minnesota.
Macy's plans to open five new Macy's stores, one new Bloomingdale's store, and one smaller replacement Bloomingdale's store.
The MOA store is Minnesota's only Bloomingdale's location. The closing comes as a bit of a surprise given the high traffic of the mall and strength of luxury shoppers last year.
With the exception of additional security guards and police officers, the Mall of America was relatively quiet Tuesday, a day after a group of teenagers rampaged through the retail center.
Things are calm,” Mall of America spokesman Dan Jasper said Tuesday.
Several shoppers and workers, interviewed by Star Tribune reporter Wendy Lee, said the incident would not deter them from their usual business.
Rachel Mitchell, a server at Bubba Gump Shrimp Co., acknowledged that the mall could be a prime target for an attack, but she's still coming into work. The fact that incidents like Monday's are rare in the mall's history, indicates it is safe, she added.
Mitchell recalls seeing a group of "scary looking people" going down the escalator as she was leaving work at 5:15 p.m. on Monday. They were wearing low pants and baseball caps, she said.
"You're always vulnerable wherever you are," Mitchell said. "This is just a couple of stupid thugs that just want to throw chaos and one day."
Shereese Loyd, a 33-year-old Burnsville resident, said the news of yesterday's mob wouldn't stop her from visiting the megamall. Loyd brought her six-year-old son Micah and five-year-old nephew Elijah to watch a dance performance.
"It wouldn't deter me from coming out, because something like that could happen anywhere," Loyd said.
Loyd said she felt secure at the mall.
"You see security guards standing around," Loyd said. "It seems like they have enough people walking around."
Larry Wood, a Cambridge resident, was surprised when he read on Tuesday morning about the mob at the mall. He told his family, including his 11-year-old granddaughter Noelle, who was visiting from North Carolina and wanted to go to the megamall.
"I showed it to everybody," Wood said. "Look at what we have to look forward to."
But his family came to the mall anyway, with 30 stores they wanted to visit, listed out based on their location.
"We're from North Carolina and we're determined to still come," said Jennifer Bushinski, Wood's 35-year-old daughter and Noelle's mother.
"It's an unfortunate incident and it doesn't seem like a recurring event."
The Mall of America and Bloomington police have indefinitely boosted security at the mall after a large crowd of teenagers rampaged through the mall Monday, fighting with each other and assaulting shoppers.
The mall is also investigating suspicions that the violence was organized through social media, in particular through Facebook chatter, Executive Vice President of Operations Maureen Bausch told the Star Tribune.
A fight that started in the food court around 4:20 p.m. Monday quickly escalated into a group of 200 kids, ages 10 to 16, racing throughout the mall throwing punches, shoving shoppers, and hurling chairs, incidents that were captured on cell phones and posted to YouTube.
Monday was the most serious incident at the mall since 1995, when crowds of young people also brawled. The violence prompted the Mall of America to ban people under 16 from entering the mall on Friday and Saturday without an escort from parents and guardians.
Bausch said the mall would conduct a top to bottom review of security and mall procedures.
About 5 percent to 10 percent of stores shut their doors by 7:15 p.m., more than two hours before the mall closed, Bausch said.
Bausch said she did not know what kind of impact the incident had on business. The day after Christmas is one of the busiest shopping days of the year.