Neiman Marcus puts customers first in turnaround effort
New York — Neiman Marcus is focusing on offering more exclusive merchandise and personalized offers to drive sales as it goes it alone to turn around its business.
The luxury department store chain confirmed Tuesday that discussions for a partial sale or outright purchase of the company have ended. The Wall Street Journal had earlier reported that talks had stalled between Neiman Marcus and Hudson’s Bay, which operates such chains as Lord & Taylor and Saks Fifth Avenue.
“While looking ahead, we know challenges remain, but we are encouraged by the strategies we have in place to improve our operational efficiencies and financial performance,” Karen Katz, CEO and president, told investors during a conference call after the company released its fiscal third quarter results.
Like many luxury retailers, Neiman Marcus has struggled as even wealthy shoppers are looking for cheaper deals online.
It reported another quarter of sales declines, though business has improved as it increased its assortment of exclusive merchandise and personalized its offers to customer. In fact, forty percent of its evening wear is now exclusive. Katz says such moves will help differentiate itself from rivals and get out of the slump.
The Dallas-based company reported that sales at established stores for the period ended April 29 were down 4.9 percent, less steep than the 7.3 percent drop in the previous quarter.
Katz says the fact that Neiman Marcus has only 42 stores in addition to its Bergdorf Goodman store sets it apart from the mega-department store chains. “We know our customers very well,” Katz told The Associated Press.
Furthermore, 30 percent of its business is online now.
Neiman Marcus plans to use technology to better personalize its offers online and in the store. A year ago, it beefed up its analytics team so shoppers can walk into the store and sales people with mobile devices can check what they bought and searched for on the website.
Online, shoppers are seeing a more personalized site that highlights items the person had searched for in the past. Neiman Marcus is also offering more targeted emails to shoppers. Neiman Marcus says that 75 percent of its customers receive a custom digest of emails, which is a key driver of traffic.
Neiman Marcus has also launched high-profile exclusive merchandise with limited availability or distribution. That includes a Nike and Riccardo Tisci collaboration at Bergdorf Goodman, and a social media campaign with influencers like Bella Hadid and Victor Cruz. The company said it sold out the entire collection in a matter of days. Bergdorf Goodman also had a partnership with the Lady Dior Art bag and the Chloe Nile handbag. Katz also noted Neiman Marcus and Bergdorf Goodman were the only retailers to show and promote Chanel’s new bag, the Gabrielle, on a dedicated online landing page. While shoppers could not buy on the website, it did draw its customers to stores.
Katz told The AP that having exclusives are becoming increasingly important.
“Price transparency is here to stay,” Katz told The AP. “All of them understand how to be savvy locating the best price on any given product.”
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