Consumer Culture & The Ikea Catalog

Quartz: “Beginning July 31, IKEA’s highly-anticipated catalogue will appear in millions of mailboxes around the world … This year, it took the Swedish company 18 months and a hundreds-strong army of photographers, art directors, copywriters, proofreaders, prop masters, carpenters, photo retouchers, programmers and CGI specialists to produce the catalog’s 1,400 pieces of art and 24,000 texts. While the text remain basically the same worldwide, IKEA’s team does go the extra mile to swap out subtle, tell-tale details in 72 different region-specific editions.”

“Knowing that kitchens in China are much smaller than the US for example, catalogue designers crop into a photograph and reposition elements in post-production, to illustrate a cozier cooking space … Last February, members of Israel’s ultra-Orthodox Jewish community received a 67-page, all-male product catalogue with challah boards, Shabbat candlesticks, tables set for the Sabbath meal, and Billy bookcases propped with volumes of the Talmud and Bible, the Jerusalem Post reports.”

“The annual catalogue is also a way for IKEA to set prices for their different markets, factoring in the cost of goods, transport, and tariffs and the foreign exchange rate … IKEA works with five paper suppliers and 31 printers around the world to produce the catalogue each year. In choosing the paper … they even consider how different markets perceive quality vis-a-vis the paper’s brightness and sheen. An Ikea exec comments: “People have a ‘magazine moment’ with a cup of tea, at home, touching the paper.”

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Will Mom & Pops Rise Again?

New York Magazine: “What becomes of the ground-floor city when retail mutates into new forms? Some luxury brands might keep their boutiques as indulgences and loss leaders. But as national chains’ contracts give up on physical locations, commercial rents could fall, clearing the way for a resurgence of small stores: designer cookies and pet spas, but also used-book stores and shoe-repair shops. Or maybe only bars and restaurants will survive, and we will repurpose vacant storefronts into living spaces for a housing-strapped city.”

“Amid all these conflicting trends, the architecture of retail is feeling its way, with sometimes-happy results. The new Nike palace by BKSK, on Broadway at Spring Street, is a paradox, a small structure that contains an immense store and looks at first glance like it was always there. The façade, which fades from masonry to glass as it approaches Broadway, turns it into one of the finest commercial buildings in recent years. Inside is a jangling theme park of high-tech comfort and moisture-wicking synthetics. But the sepia exterior looks as though it has just leapt from an old photograph.”

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How TJ Maxx Defies Digital Gravity

The Wall Street Journal: “Traditional retailers are in crisis, damaged by rapidly shifting consumer tastes, technological change and cut-throat price competition. And then there’s TJX Co., which is defying gravity with the simple idea that under the right circumstances people still like to shop in stores … Central to TJX’s success are its merchants. The company employs more than 1,000 buyers who buy apparel and other goods from more than 18,000 suppliers around the world. Each buyer controls millions of dollars and has authority to cut deals on the spot, unlike most department stores, which can take weeks to review and approve orders.”

“Stores typically get deliveries several times a week. The schedule ensures a continuous stream of products to lure shoppers. And because TJX doesn’t purchase the full range of colors and styles, stores have one or two items in a particular color or size, giving customers an urgency to buy … Its stores have no walls between departments, so it can quickly reconfigure floor plans. Similar clothes from different labels can be found on the same rack.”

“One area where TJX trails other retailers is on the Internet … Some brands won’t let TJX sell their products online because they don’t want the items to be easily searchable at lower prices. For certain brands that allow online sales, shoppers have to click on items before they can see brand names. The restraints are similar to those in the physical world, where some companies do not allow TJX to advertise their brands. Advertising individual labels is not part of TJX’s marketing strategy.”

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Neiman Markups: Out of Fashion

The Wall Street Journal: “Once upon a time, all Neiman needed to do to lift profits was raise prices. That model has since fallen out of fashion … competition from startups like Farfetch.com and Matchesfashion.com are forcing more discounts. Over a recent 24 hours, Farfetch’s prices averaged 2% lower and Matchesfashion’s 15% lower than Neimanmarcus.com’s prices on 32 identical items, according to price-tracking firm Market Track LLC.”

“While brands still exert control, particularly over the newest and most popular items, it is harder for them to police prices that change rapidly across websites and fluctuate with shifting exchange rates, industry executives said … The explosion of discount chains, led by T.J. Maxx , that sell designer brands at cut-rate prices also made consumers rethink the need to pay full price. To compete, high-end department stores rushed in with their own off-price chains—Neiman’s Last Call, Saks Off 5th and Nordstrom Rack.”

“Neiman’s Chief Executive Karen Katz … championed a line of specialty stores called Cusp, which Neiman opened a decade ago, that feature lower-priced clothing and accessories. Neiman stores also have added relatively less expensive goods, such as $700 Prada handbags … Ms. Katz reduced snob appeal by allowing Neiman shoppers to use Visa and Mastercard … Neiman has invested heavily in e-commerce … Not all the moves have worked. After building six Cusp stores, Neiman closed two and stopped development of the chain in 2012.”

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Footwear: How Saks Attracts Men

The New York Times: “Next week, Saks will open its first free-standing store specially for men, in Brookfield Place, the retail, office and dining complex in Lower Manhattan … The 16,000-square-foot Saks Fifth Avenue Men’s Store will include leather and shoe repair services, made-to-measure suits and a tech bar selling the latest gadgets … In the spring, an in-house Sharps barbershop and Fika coffee shop will be added. And a monthly rotating pop-up shop will feature, in the opening weeks, 200 styles of sneakers, 40 of which are Saks exclusives.”

Saks President Marc Metrick explains: “Footwear is a gateway drug.”

“Saks is luring the stylish new man with a palette of whites, taupes and silvers and chevron-patterned porcelain flooring. Gone is the brown-wood, Morton’s steakhouse look of the uptown men’s department. The vibe is not unlike the Saks women’s store at the opposite end of the complex.”

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Store Check: Why is TJ Maxx Doing So Well?

Editor’s Note: After reading news stories about the struggles of Macy’s, Kohl’s, Sears and JC Penney, I visited a TJ Maxx yesterday (Norwalk, Conn.) to see why it is doing so well. It’s just an ordinary and ostensibly boring strip-mall store. The location is nothing special. The store itself is not new, but it is neat and orderly, well lighted, and well maintained. The sight lines are clear from one end of the store to the other, and the aisles are wide. Racks are marked, by (low) price signage, and all items are also clearly marked, with prices in large digits. Tags include a comparative retail price.

Name brands are easy to spot. A big sign on the wall lets you know that they have the same brands you’ll find at the mall, for less. Lots of displays with attractive, unusual items (treasure hunt). In addition to extensive men’s, women’s and children’s apparel (most of the store), there’s luggage, handbags, household goods, bedding, beauty care, toys, etc. Everything looks like someone just put it back in its proper place.

Oh, and restrooms are marked with a big sign, and the men’s room was not only clean, but decorated. Checkout, bordered by shelves of impulse items, is a single, long, snaky line, but moves quickly. Sure, there’s a world of complexity under its hood that makes the TJ Maxx experience what it is, but to the shopper, its magic is as plain as a sugar doughnut. PS: I do think their logo could use an update.

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Fast Fashion: How Zara Does It

The Wall Street Journal: “A black, high-collar women’s wrap coat, fastened with a metal ring … The garment’s journey from design workshop in Spain to retail display rack in Manhattan … offers an inside look at the fast-fashion model that has made Zara’s parent company, Inditex SA, the world’s biggest fashion retailer by sales.

“A designer and pattern maker at the Spanish company’s headquarters, in the small industrial city of Arteixo, took five days to fashion a prototype of the loose-fitting winter coat … A second pattern maker, cutters and seamstresses then worked 13 days to produce 8,000 of the coats. Over the next six days they were ironed, labeled, tagged, checked for quality, then trucked to Zara’s logistics center in Zaragoza and from there to Barcelona’s airport. The next day one of the coats was on a truck from John F. Kennedy Airport to the Fifth Avenue store, to sell for $189.”

“Every creative decision about the women’s wrap coat—as all other Zara garments—flowed quickly from impromptu discussions at Inditex headquarters, in an open workspace slightly bigger than a soccer field. Designers and commercial staff sit side by side there, in electronic and telephone contact with Zara store managers around the world. Store managers, often flown in to consult, viewed a mock-up of the coat and helped shape its design … The women’s wrap coat is one of more than 50 of its kind shipped to the Fifth Avenue store in small batches this fall … To give shoppers a sense of exclusivity, Inditex says no more than 25,000 of the coats will be made, even if they sell out.”

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Neiman Marcus Rents a Runway

The Wall Street Journal: “In a strategy that sounds counterintuitive but is a push to bring in younger shoppers, Neiman Marcus has invited the rent-a-dress company Rent the Runway to open locations within its stores … Neiman Marcus hopes that Rent the Runway, which is popular among 20-something shoppers, will serve as bait for a generation that hasn’t taken to department-store shopping the way their moms did … Neiman Marcus executives are also looking forward to collecting shopping data to study how these young dress renters spend in other areas of the stores.”

“The partnership will enable Rent the Runway members to try on clothes in Neiman Marcus stores. Customers will also be able to rent online from Rent the Runway and pick up or return the clothes to a Neiman Marcus … Neiman Marcus executives hope that over time, those 20- and 30-something shoppers will return to buy again and again, becoming the next generation of Neiman Marcus customers.”

“Rent the Runway’s 3,000-foot boutique within the store will have a mix of rentable clothes and Neiman Marcus shoes, bags, jewelry and other items, including underpinnings like bras and Spanx. Stylists employed by Rent the Runway will work with shoppers to assemble outfits, working with sales associates from the department store when needed. There is a cosmetics counter where shoppers can get their makeup done.”

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The Landweb: Saks Deconstructs & Reinvents

The New York Times: At Saks Fifth Avenue Downtown … product displays are inspired by websites that encourage shoppers to browse. Where traditional department stores keep handbags separate from clothing … an edited range of goods is organized by designer label, with handbags, ready-to-wear and jewelry commingling on a circular path intended to inspire surprise finds.

Saks President Marc Metrick comments: “We wanted to de-compartmentalize the department store. That’s not how she shops anymore … we lay things down flat on tables, just like you’d see on a website.”

Saks also “has rolled out applications from the retail technology company Salesfloor that enable online visitors to live-chat with a sales associate at a nearby physical store. After browsing product suggestions online, shoppers can make an appointment to meet their sales associates in person, to continue shopping. And even after the in-person visit, the shopper can follow up with the very same sales associate again, online.”

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Lord & Taylor’s ‘Fast Fashion’ Play

The Wall Street Journal: Lord & Taylor is taking a page from Zara. This summer, when an Isaac Mizrahi off-the-shoulder top nearly sold out days after hitting its stores, the department-store chain had the blouse back in stock in six weeks. It used to take nine months.”

“The quick turnaround was the result of a partnership with New York-based Xcel Brands Inc., which owns the IMNYC Isaac Mizrahi brand among other labels and is trying to make a business selling fast-fashion tricks to traditional brick-and-mortar retailers. Here is what it looks like: Xcel keeps stockpiles of unfinished fabric, so it is available quickly to be dyed, cut and sewn into the latest trend.”

“Lord & Taylor is able to procure the goods at a lower price by eliminating intermediaries and buying directly from the factories. That helps to offset the higher cost of shipping some items by air. Xcel, meanwhile, collects a royalty fee from Lord & Taylor based on retail sales.”

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