Shopping Centers Today

DEC 2018

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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D E C E M B E R 2 0 1 8 / S C T 33 Main and Perigold names, had seemed resolved to sell online only — to the point of boasting on its website as late as last year that it had no physical stores. "No more searching 'Wayfair store near me' or planning an all-day family trip to a furniture store to shop," the website read. And yet, last October Wayfair CEO Niraj Shah hinted at the Chief Housewares Executives Super- Session conference that the furnisher was looking at using physical stores primarily as online-business drivers, QRWDVSURÀWFHQWHUV Wayfair pop-ups will offer about 300 stock-keeping units of housewares and tabletop products, out of the retailer's roughly 8 million online SKUs. Way- fair's use of stores "will be an iterative process, and we will use our learnings from visitors to our pop-up stores to determine the best format to offer [our] shoppers in the future," Shah said during an earnings call last month. Two years ago Wayfair introduced DÀUVWSDUW\VPDUWSKRQHDXJPHQWHG reality application it calls Wayfair- View, which enables users to visualize digitally the way furnishings and other products will look inside their homes. In April Morgan Stanley analyst Simeon Gutman said a key aspect RI:D\IDLU·VXOWLPDWHSURÀWDELOLW\ involves its ad-spend per incremental customer, which is increasing, and which is leading to losses among new customers while outpacing any improv- LQJSURÀWVRQUHSHDWRUGHUV0RUJDQ Stanley research concludes that Wayfair's strong sales and essentially SURÀWOHVVJURZWKZLOOFRQWLQXHRYHUWKH next three or four years. Wayfair posted a third-quarter 2018 net loss of $151.73 million, against a $76.43 million loss for the comparable quarter in 2017. Ruling on South Dakota v. Wayfair in June, the Supreme Court overturned one of its own precedents in saying that online retailers such as Wayfair should collect state tax regardless whether the retailer has a physical presence in the state. Q will offer closeouts and returned items in good condition and will connect with an existing Wayfair distribution center, the retailer says. Pure-play Internet retailers such as Wayfair are expanding increasingly into physical stores to create product touch points and complement on- line sales, according to Herb Tyson, ICSC's vice president of state and local government relations. "There is a halo effect," Tyson said. "They are recognizing they need brick-and-mor- tar to connect with more shoppers." On the other hand, physical retailers ZLWKVWURQJHFRPPHUFHRIIHULQJVÀQG that they start losing online sales when they shrink their brick-and-mortar footprints, says Tyson. "It's obvious that the two augment one another." Food-and-gifts retailer Harry & David and publisher Good Housekeeping are among those opening pop-ups of late. Wayfair, which also operates specialized home-decor sites under the AllModern, Birch Lane, Joss & Having a trendy physical space to impress shoppers is vital for apparel brands seeking to grow and elevate their status. Here are five retailers with some new ways to connect with consumers by means of stores. • Sports brand Volcom opened a store atWestfield Century City, in Los Angeles. Thisstore follows the opening of the brand's flagship in Paris last year. Volcom has his- torically been distributed in largely coastal areas, with a major portion of its sales generated in California, Hawaii, Florida, the south of France,Spain and Australia. Volcom now operatesroughly 120 stores worldwide, of which nearly 40 are run by licensees. • Women's brand L'Agenceopened a 1,000-square-foot store at 1011 Madison Ave., its first in the Manhattan borough of New York City,and only itssecond since its inception in 2008 —a storeon Melrose Avenue in Los Angeles. L'Agence has plans to open two stores next year and four the year after that. • Hatch, a digitally native maternity lifestyle brand, has opened its second permanent brick-and- mortar store, in the Brentwood neighbor- hood of Los Angeles. This1,400-square-foot spaceacross from the Brentwood Country Mart usedthe same design- ers as did the retailer's New York City flagship, in SoHo. The store will house Hatch's ready-to- wear apparel and Hatch Mama beauty products. Plans are also for the site to be a community cen- terfor panel discussions, wellness programs and similar events with afocus on matters important to expectant mothers. The unit willinclude a "crav- ings bar" — for serving pickles, ice cream and similar snacks. Hatch says it intendsto open 10 more stores by 2020, in such markets as Boston, Chicago andSan Francisco. • Cult fashion retail- erDolls Killopened its first offline experience in 2017 —a1,100-square- foot store inSan Francisco. Now, less than a year later, the brand has a6,000- square-foot flagship in Los Angeles The aesthetic mimics an industrial nightclub, including weathered brick walls. FOUR TRENDY BRANDS MAKE STATEMENTS WITH STORES >

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