Northwest Arkansas Democrat-Gazette
Benefits of a Saks e-commerce split
Eight months after Hudson’s Bay Co., the Canada-based owner of Saks Fifth Avenue, split off the luxury retailer’s e-commerce business into a separate entity, changes are already underway on its site. The number of styles Saks.com sells is up 40%, and the number of brands available has increased by 30%. Saks.com is also increasing offerings in kids clothing and home furnishings as well as activewear. Shoppers now enjoy free deliveries and returns. And eventually, shoppers will see speedier deliveries. Behind the changes: Marc Metrick, previously president and CEO of Saks Fifth Avenue, and now CEO of the new Saks.com company called Saks. Metrick says the stand-alone company with new financing means the business can grow bigger much faster. So far, there are signs the spinoff seems to be working. Saks.com now has 1 million visits a day, up from 500,000 two years ago. And the total value of merchandise rose 80% on Saks.com, while store sales increased 30% in the second quarter ended July 31 compared with the same period in 2019. Venture capital firm Insight Partners plowed $500 million investment for Saks.com and values the standalone business at $2 billion. Hudson’s Bay, which also owns Saks Off Fifth and the Canadian Hudson’s Bay department store chain, went private nearly two years ago. AP recently interviewed Metrick.
What’s the biggest difference?
Since we launched Saks.com in the late 90s, we were an “or” company. We can invest in online or in the stores. We can buy inventory for online or the stores. We could focus on marketing for online or the stores. Now we’ve become an “and” company. We can invest in our online and our stores. We can spend marketing dollars for our online and our stores. We can buy merchandise for online and our stores.
How’s the luxury business faring?
I am very pleased with how the business held up and how the business pushed through the pandemic. There are people that really want to get dressed up again.
How’s the delivery speed being improved?
We used to focus on getting it to you when we could. Now we’re focusing on getting it to you as fast as we can. There’s probably a day or two faster delivery, and that’s not really where we want it to be yet. But that’s a work in progress right now.
Are there plans for Saks.com to go public?
My job and my team’s job is to focus on the customer experience doing everything we’re saying we’re going to do and building this business. What happens from a capital market standpoint, who knows?
What about acquiring new customers?
We’ve acquired about half a million new customers just in the last seven months while maintaining all the right economics, and I’m thinking about the economics much differently.