Today I had the privilege of attending a talk given by Marvin Traub, who served as President and CEO of Bloomingdales for 22 years. He is responsible for a great deal of the innovation that has occurred in retail in the last few decades. His team coined the phrase, “Bloomingdales: Like no other store in the world.” And they made it come true.
Marvin gave his thoughts on the current trends in retail and luxury, and I wanted to share the highlights here:
1. We, the customer, are more sophisticated. We want value, and due to the internet, we know what things cost around the world. Companies are understanding this too: for example, Burberry will be moving to common pricing globally.
2. Major US brands are now global. Ralph Lauren wants to achieve 1/3 of its sales in the US, 1/3 in Europe/Middle East, and 1/3 in Asia in the next five years.
3. China is king. It’s the number one market for brands like Zegna and Ferragamo already. Gucci already achieves ~24% of its sales in China.
4. Luxury brand growth. It’s why Arnault is chasing Hermes so fervently right now – he believes in the long term growth potential of luxury.
5. Internet matters (of course). Successful websites will become the #1 most successful store for retailers. This is true for Macys already which does $1B a year from online.
6. Brick & mortar stores don’t have to be scared of social commerce. The customer that shops in a store and online spends on average, 3x as much as if they were to shop only in brick and mortar stores.
His concluding thoughts: never stop working. He was a fascinating speaker. Thoughts on the future of retail, and luxury?