9.082008

saks gets it; bloomie’s not so much

NY Times’ Stuart Elliot recently reported about dueling efforts between Saks Fifth Avenue and Bloomingdale’s to lure back reluctant shoppers.

Saks is expanding the availability of video clips on its website saks.com, offering a virtual version of its catalog.  Bloomingdale’s, has launched a new music-oriented campaign in its advertising and will feature live music performances in store.  The two approaches provide a great contrast between developing a brand value delivery system (Saks) and simply developing creative brand expression (Bloomingdale’s).

Saks’ new video clips allow viewers to engage with and better understand its products — how they look on a live model (as is the case in videos for new designers’ wares) or how they work (as is the case for beauty care products.)  As such, they are providing additional value to customers and increasing their brand equity.  Denise Incandela, president of the Saks Direct unit, explains, “For luxury goods, there’s an expectation of a higher level of service,” she added. “This is a way we’re trying to accommodate that.”  What Saks has done is an example of a brand delivery system — the identification, prioritization, and implementation of programs and initiatives to deliver the brand (in this case, luxurious service) through a core operating system.

In contrast, Bloomingdale’s new effort seems nothing more than a cool ad campaign.  Although associating  with the likes of Joshua Bell or Wyclef Jean may make the brand seem hipper, the retailer isn’t using its brand to drive its business forward.  And while some may argue that the live music performances will enhance the brand experience, I don’t think the lack of a cool shopping experience is what is keeping people away from luxury retail.  These days, I think people are concerned about making smarter choices and getting more value.

Certainly a brand is strengthened by what you say (what and how you communicate with customers) –- but it is primarily what you do (what and how you provide to them) that drives value creation.  This is what I mean by “brand-as-business” –- brand-as-business is a management approach that involves the deliberate and systematic management of the business around the brand.

Saks gets “brand-as-business.”

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  • Isn’t the issue here which strategy will drive more consumers to buy their products? Both have strong respected brands, so the investment here isn’t to further build brand stickiness (both work in my view) as to sell merchandise. It seems both are valid strategies. Bloomie’s angle is that the live music will drive consumers into the store, where they can touch and feel (and smell) the merchandise, and hence bring them closer to a buying experience. Saks’ strategy also makes sense, but doesn’t necessarily engage the consumer to visit the store as much (but that might be arguable. Bloomie’s strategy also reflects the importance of having a brick and mortar store, and the overhead that goes with that including sales staff, and you can’t engage consumers with that investment unless you get them into the store. Saks may appeal to a different consumer as well, than Bloomie’s does. While the online videos and catalogs are great in concept, that may or may not get consumers into the store — and they can order online. While if that works it supports the goal of selling merchandise, but doesn’t address the personal engagement in the store.