Topshop Looking to Take More of Manhattan
Could
it be that "fast fashion" Topshop represents another example
where British retailing just doesn’t cut it in the U.S.? The retailer claims
it is doing quite well, thank you, but there are plenty of critics to go
around about its merchandise, pricing and store design.
All
that being said, the New York Observer reports that Topshop owner
Sir Philip Green is scouting Manhattan for two new locations to add to
the recently opened flagship in Soho.
The
store has gotten generally high grades from shoppers for its merchandise
although some question price points that are said to be on the steep side.
New Yorkers have been hard hit with the fallout of the banking crisis and
problems on Wall Street and spending $100 on a basic blue blazer, as the Observer reports,
is going to be a tough sell in the current environment.
Still,
Sir Green is looking to find two spaces of 50,000 square-feet each to open
new locations.
"They
have not let up," Faith Hope Consolo, chair
of retail leasing and sales for Prudential Douglas Elliman,
told the Observer. "Their plan was always to have at least
a dozen stores in the tristate area, but the
concentration is three in Manhattan."
Discussion Questions:
Are criticisms of Topshop’s merchandise, visual
merchandising and pricing legitimate? Are there changes it will need
to make based on the economy, American consumer preferences, etc. to
be successful in the U.S.?
I feel great about Topshop’s prospects and it is one hop over the pond that truly has me excited. There is a plethora of basics and cheap chic players (H&M, Zara, Uniqlo, Gap, American Apparel, etc.) so criticizing Topshop for not joining the fray is missing the point. There is a huge, gaping whole right smack in the middle of apparel retailing, one that is getting deeper and wider as shoppers show to hand to retailers such as Talbots and Chico’s, whose ongoing frump-fest is turning off a more modern and fashion-conscious woman…and as lower end players such as Walmart and Target stop reaching for the stars and go back to basics (back to the fray).
The missing link is what an international apparel brand guru described to me this week as “mass premium;” an aspirational customer that doesn’t see the value in designer duds. J.C. Penney and Macy’s are attempting to play here; however, their recent lack of success does not mean the market doesn’t exist. I would posit that Topshop’s more interesting, forward and engaging environments are much more conducive to wooing this underserved woman. Topshop never claimed to be a cheap date and I believe that Mr. Green’s model will resonate as women snap out of the doldrums.
Topshop’s debut into the crowded teen and twenty-something segment comes at a challenging time to say the least. But, as the recovery begins and picks up speed, the teen retailers that have endured will come back strong and fast, even aspirational brands. If they keep their visibility high which will keep the buzz strong, they will win in this economy and position themselves well for expansion when the US economy recovers.
Their strategy of entering the tri-state market first could actually help them in the long run. New York is a hugely challenged city currently. But, as the song goes if you can make it there you can make it anywhere.
It’s a tough time to be jumping into this the US market, but hey, go for it. Their current SoHo store’s performance notwithstanding, that area is relatively unique. There are some great stores (Michael K, Uniqlo, etc.) there that would have a hard time surviving outside that trendy neighborhood. Careful site selection is definitely the key here for further expansion.
Any time a foreign retailer comes into the US market, there is always the question of, “Do we alter our image to fit into the US, or is our uniqueness a plus and we should capitalize upon it?” Takashimaya is a great example. Their Fifth Avenue store is a great sensory experience. It reflects the atmosphere of their home market. I’m not certain how they’re doing financially today, however when I visited the store before the economic bust, they were doing fine. I agree with Carol that there is a gap in the market for this retailer to capture share… but Carol always seems to be on top of the apparel scene. Not that she shops in those trendy neighborhoods or anything. 😉