Traditional Retailers Give Themselves a Facelift with New Beauty Offerings

Established department stores have long faced competition from the booming e-commerce industry. For many luxury retailers, upgrading a location's beauty offerings is a vital move in order to survive the apocalypse of traditional retail. On May 22, Saks Fifth Avenue in New York City renovated its beauty department to create a space 40 percent larger than its predecessor. The department is now 32,000 square foot, with more than 120 beauty and wellness brands, as well as spa rooms providing facials and massage treatments. The investment for the entire flagship renovation is 250 million. Just a month ahead of Saks' beauty floor opening - and on the other side of the world - The SKP Mall Group launched a luxury shopping center in the city of Xi’an in China, with a 43,056 square foot beauty hall containing over 70 brands. The plan for these retailers seems to be threefold: bigger beauty spaces, more beauty brand offerings, and increasingly experiential shopping options. At the new Beauty 2.0 floor in Saks, consumers can find various kinds of add-on services, including dedicated spa rooms for luxury brands Chanel, Clé de Peau Beauté and Dior. The department includes FaceGym, the first facial workout in the US, designed to sculpt, lift and tone the face. Beauty 2.0 also offers various personalization options, from Givenchy lipstick cases to Guerlain perfume. “By offering beauty and wellness workshops and panels, Saks is taking a holistic approach to making our clients feel great both inside and out, ” said Tracy Margolies, the Chief Merchant at Saks Fifth Avenue. The new floor also accommodates today’s tech-savvy consumers. Currently, YSL offers YouCam technology, which allows customers to virtually try on YSL cosmetics before physically testing them. Other brands are expected to introduce similar "magic mirrors" to the beauty department over the next few months At SKP Mall in Xi’an, an immersive in-store experience is created through the use of a "design language." Sybarite Co-Founder Torquil Mcintosh led the architectural team for SKP Mall alongside Simon Mitchell. Mcintosh said: “We created unique design codes to be displayed at SKP, from the door handle, the escalator, the screens, even to the toilet, the design language is everywhere and customers are immersed in it.” What’s the goal? “If someone takes a selfie and shares it on WeChat, we want people to instantly recognize that it was taken at SKP” said Mcintosh. The past few years have proved difficult for brick-and-mortar retailers in China. British retailer Marks & Spencer opened 15 stores in China over an eight-year period, but exited the mainland market in 2017 due to continued losses. China’s foreign retail pioneer, Malaysia-based Parkson, first entered China in 1994, but has closed more than 10 stores in the past three years. Despite attempts to raise footfall, online channels continue to disrupt customers' purchasing journeys in traditional offline stores. For beauty, many consumers now choose to try out a product in store, and then purchase it later online. To account for the overhead costs that come with running a physical store, retailers need to find ways to innovate, persuade visitors to peruse products for longer - and ultimately - to buy. When asked if they're concerned by the competition of online shopping channels, Mcintosh said he is confident in the power of curating worthwhile experiences, “In the beauty hall we're less concerned with the competition online - naturally there are social media, and online shopping always comes first from experience. The better the offline experience you can create, the more traction you can get from online. When people share experiences, good experiences, they are naturally inclined to share them on social media.” Traditionally, retailers would have full control over the look and feel of brands within department stores, leaving little room for creativity or to display the individual characteristics of each label. Despite the SKP Mall Group creating a visual merchandise style guide for each brand to follow, the individual labels are encouraged to express their own brand values and aesthetic. “With Saks, they’ve done the opposite, they created the furniture and visual outlooks for each brand. Those are two very different approaches, I am not saying one is better than the other, but at SKP we have found unique brands sell more. We have found a balance between SKP branding and the way brands want to express themselves,” said Mcintosh. According to Saks, it does give its brands the opportunity to be creative. Saks' Store Design and Planning worked in collaboration with architectural firm Gensler. Vendors were given the opportunity to create innovative—and in some cases first-of-their-kind—spaces at Saks. As Jing Daily previously reported, a desire to understand the look and feel of a luxury brand motivates Chinese consumers to shop. Experiential shopping has become a primary way to shape China's perception of luxury - more so than in any other country. Additionally, Saks Fifth Avenue will begin explicitly promoting its new Beauty 2.0 floor on WeChat - China's biggest social media app - later this month.

Traditional Retailers Give Themselves a Facelift with New Beauty Offerings

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Published June 18, 2018

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Traditional Retailers Give Themselves a Facelift with New Beauty Offerings