I recently made a field trip (ok, I was shopping too!) to the Woodbury Commons Premium Outlets in upstate New York and had such a great experience. Despite its substantial size and a few “tourista” buses, it had the feeling of a small, quaint village. It was laid out with similar brands adjacent to each other. There was a plethora of upscale brands from Chloe, Chanel and Jimmy Choo to Furla Luggage and David Yurman. It got me to thinking about the fact that it’s always a risk for a prestigious brand to go “down-market” to malls and even retail outlets, but it’s a very savvy strategy if done well.
As we’re seeing more and more, women’s shopping habits are changing…she might be wearing Michael Kors shoes bought at Neiman Marcus, a Marc Jacobs dress from Loehmann’s and carrying a Mossimo handbag from Target. And with that evolution, retailers can make adjustments to the channels they utilize to reach consumers.
In fact, I just saw an article this week about the fact that Saks and Nordstrom are headed to outlet mall locations. Even consumers who typically shop in luxury retail stores are worried about wealth destruction, retirement savings, debt and whether they’re still employed. But they still want to shop at the Neiman Marcuses of the world – and have the same great customer service experience – all while paying less. Retail options such as this allow them to do that.
In the past, outlet malls were used to clear out overstocked merchandise, clearance items or irregular sizes without hurting full-line stores. But that’s a thing of the past, with outlet mall stores now also offering merchandise that’s exclusive to their stores.
Wal-Mart and Target have been doing this for years, with great success. Think of Target’s Isaac Mizrahi or Rachel Ashwell product lines, or even Wal-Mart’s Norma Kamali line of clothing. Kohl’s is another one that does this very well, with powerhouses like Vera Wang, Daisy Fuentes and Avril Lavigne in their retailer-exclusive arsenal. So in essence, retail players like Saks and Nordstrom are jumping into waters these pioneers have already tested…but this also provides the benefit of having a stronger brand image than what is typically found at discount stores.
So now you know what I think – definitely a smart strategy…what do you think?