HBC, the owner of Saks Fifth Avenue, is splitting the luxury department store’s website into a separate business from its stores after raising $500 million. As such, Saks’ 40 brick-and-mortar stores will become a separate business known as SFA, though it will still be owned by HBC.
Long-term survival for the majority of department stores tracked in Gartner’s report on the sector is dependent on rethinking assets and strategies. For the last few years, heavily indebted department stores failed to innovate store footprints or marketing strategies enough to withstand the rise of multicategory retailers and digital pure plays. While COVID-19 catalyzed an e-commerce boom for industries deemed essential, most department store brands executed mass closures alongside significant organizational overhauls. By re-figuring its own digital assets, HBC and SFA give themselves a second life post-pandemic.
Marketers in the luxury retail space need to identify where they can make high value investments in their current digital experiences to offer the evolving consumer more opportunities to shop. The path ahead may be shaky, but doubling down on improved digital assets can keep brands stable throughout