Saks, Ralph Lauren lure customers with upscale services

Discussion
Photo: Saks Fifth Avenue
Oct 24, 2016
Matthew Stern

The combination of a slow economy and changing shopper priorities has made luxury products a tougher sell. And that’s compounded by the fact that shopping malls, where many high-end retailers and department stores are found, have been steadily waning in popularity for years. This has some luxury retailers offering services meant to extend both the in-store and offsite experience and cater to the upscale tastes of their target clientele.

Ralph Lauren in Manhattan, for instance, has been offering customers a ride home in a company-branded BMW as a perk for buying particular suits, the Associated Press reported. The retailer intends to expand the service to other stores in high-end markets.

And in some areas in the U.S. and Canada, Saks Fifth Avenue has been offering its “Saks at your service” program. The service dispatches personal shoppers to deliver custom wardrobes directly to customers’ houses, offices and hotel rooms in a Mercedes-Benz van called the Mercedes-Benz Sprinter, according to 680 News. The Sprinter features, among other accessories, a jewelry safe.

Such services obviously appeal to a limited customer base, but they resemble moves other brick-and-mortar retailers have made to add on-brand experiential elements to shopping.

With luxury brands, scarcity and exclusivity is a big element of the appeal, but trying to maintain those qualities has not been easy amid increasing pressure to make everything available online.

As department store visits continuing to sink, some luxury brands have indeed been shifting their focus to e-commerce. Earlier this year, luxury handbag brands Coach and Michael Kors limited the number of their products on the shelves at the major department stores that once constituted their prime source of business.

DISCUSSION QUESTIONS: Can luxury retailers bring shoppers back into stores with services like the ones that Ralph Lauren and Saks Fifth Avenue are offering? How might offering such services balance with the growing tendency of luxury retailers to sell online?

Braintrust
"These services should feel like a natural fit to the overall experience, as opposed to feeling like a disjointed one-off."
"The question is, how much are customers willing to pay for this level of service?"
"To Millennials, the largest consumer group now, in-store experience is critical."

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14 Comments on "Saks, Ralph Lauren lure customers with upscale services"

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Jasmine Glasheen
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Jasmine Glasheen
10 months 29 days ago

I can’t imagine that many Ralph Lauren customers drive themselves to the store to make their purchase, so I fail to see how a branded BMW ride home would be a huge pull.

On the other hand, “Saks at Your Service” is genius. Personal shopping is on the rise. Education is the new currency in retail. Personal shoppers provide personalized information customers can’t get elsewhere. Shoppers will love it.

Anne Howe
BrainTrust

While these services mentioned are seemingly nice, they have a sense of advertising and publicity for the retailers at their core, so they seem a wee bit inauthentic to me. The retailers could and should reach out a bit deeper to understand what might be delightful for the shopper on the way into the store or while in the store. So that maybe the shopper might bring along another shopper and double the upside opportunity. Just a thought.

Shawn Harris
BrainTrust

As discrete service offerings, both Ralph Lauren’s “taxi” and Saks’ merchandise delivery service would be of value to shoppers, as they should help to save a shopper’s time or otherwise bail them out in a time of need. However, they must be a part of a coherent strategy of driving footfalls that includes digital engagement. These services should feel like a natural fit to the overall experience, as opposed to feeling like a disjointed one-off.

Max Goldberg
BrainTrust

Luxury retailers need to provide a seamless, customer-focused experience. Driving customers home in a BMW doesn’t cut it. Taking the store to customers’ homes is much better. Georgio in Beverly Hills used to do this and built a loyal following. Providing services that cannot be duplicated in-store encourages repeat business and builds loyalty.

Cathy Hotka
BrainTrust

As forced as these examples seem, retailers will want to focus on the store experience at every level and price point. Look at the rise of Ulta, which offers services in addition to products, and big-box sporting goods stores, which are destinations in themselves. There are estimates that Amazon now accounts for more than 20 percent of U.S. retail — traditional retailers need to step up the in-store game.

Ryan Mathews
BrainTrust

Luxury customers want to be pampered, so in a general sense value-added services make sense. But as Anne Howe notes, the offerings have to be authentic and luxury goods customers are highly attuned to faux offerings designed to separate them from their money. And what — in this world — does authenticity look like? I’d say you start with genuine personalization. Now, a personal shopper delivering products to your home seems pretty authentically personalized. Operating a high-end cab company … not so much.

Shep Hyken
BrainTrust

Luxury — as in high priced — brands must compete in the world of quality and experience, not price. So the service and perks must be at a higher level. Not that the wealthy would go to Walmart to buy clothes, but many will consider a reasonably-priced alternative. While I’m not sure a ride home in a BMW justifies the purchase, the SFA shopper program is a personalized service experience worth the premium price.

Peter Sobotta
BrainTrust

It is clear that retailers who are truly customer-centric reap the rewards of repeat customers and lower churn. The question is, how much are customers willing to pay for this level of service?

Camille P. Schuster, PhD.
BrainTrust

To Millennials, the largest consumer group now, in-store experience is critical. If there is no value to being in the store, buying online is more efficient. When retailers are trying to figure out what in-store should mean for them, it is critical that the essence of the brand, the types of consumers and the shopping styles need to be considered. What type of music, what type of lighting, confirmation of space, assortment of products, dressing rooms, activities or services are appropriate? Each retailer needs to create an appropriate in-store experience consistent with their brand and attractive to their consumers.

Lee Peterson
BrainTrust

There’s a lesson here that all retailers should pay attention to: stop thinking of only the shelves! Extra services within a brand’s physical space give customers another reason to even go there. Otherwise, why bother? Remember, people don’t have to go to stores anymore.

Will it increase traffic (either high end or otherwise)? I think the question should be, “will it show we care?” And the answer to the latter is yes.

Martin Mehalchin
BrainTrust

Bringing shoppers back into stores is a nice outcome, but it’s not the overall point. The overall point is to grow sales and loyalty to the brand. The Saks service sounds like a smart way to decouple the brand from the store location and meet customers where they are and when they are ready to spend. The Ralph Lauren BMW ride feels a little more like a gimmick.

Ken Morris
BrainTrust

It has always has been imperative for luxury retailers to make their customers feel special and exclusive. Upscale shoppers expect the “white glove” treatment. Offering special exclusive events, personalized services, exclusive and customized (built to order) products that are based on the unique preferences of individual customers strengthens brand loyalty. Savvy luxury retailers are continuing to find creative ways to “wow” its upscale clientele.

While a lot of the high-touch personalized services lend itself to the in-store experience, some of these personalized experiences are being adapted to the online experience. For example, offering online chat or video chat with a specific sales associate that has an ongoing relationship with the customer. Another way luxury retailers are personalizing the experience is by creating personal Web pages for top customers that are customized with product recommendations based on their preferences and purchase history.

On the flip side, luxury retailers, like Burberry, are infusing the digital experience with the in-store experience. The line between physical and digital is blurry.

Phil Rubin
BrainTrust
10 months 29 days ago

At least retailers like RL and SFA are trying to improve their customer experiences, even if they are not always compelling (RL). As more luxury goods are available online, and especially at Amazon, the bar will go up in terms of customer expectations of not just a good CX, but a better one. That’s the only way a luxury mono brand like RL or a department store like SFA is going to sell goods at decent margins, much less have any customer loyalty for the next shopping opportunity.

Naomi K. Shapiro
BrainTrust

Luxury retailers offering services meant to extend the in-store and offsite experience aren’t alone. Most brick-and-mortar retailers are scrambling to add experiential elements to the growing demands/wishes/needs of their key customers, including Millennials and Gen Z’ers. We just summarized this “phenomenon” in blog post: What Retailers Like Saks, Best Buy, Target, Macy’s and Even Apple Are Doing To Woo, Win, and Keep Customers in Today’s Omnichannel Milieu.

Customers for luxury retailers will always appreciate exclusivity and pampering and attention, but so will everyone feeling impersonalized or dulled in today’s digitalized, i.e. impersonalized arena.

wpDiscuz
Braintrust
"These services should feel like a natural fit to the overall experience, as opposed to feeling like a disjointed one-off."
"The question is, how much are customers willing to pay for this level of service?"
"To Millennials, the largest consumer group now, in-store experience is critical."

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