THE CHEAT SHEET
The Future of US Retail
- After months of negotiation, US retailers including Neiman Marcus and J. Crew are emerging from bankruptcy restructuring
- Many have gone through the process with a new owner and stronger financial structure, but they still face a very challenging business environment
- The turmoil is unlikely to be over as companies have to implement restructuring plans and the outlook for the coming months remains extremely uncertain
This summer, US bankruptcy court listings have read like the floor plan of a suburban mall. J. Crew, Neiman Marcus and Brooks Brothers are among the high-profile, deeply-indebted brands that sought to restructure as the pandemic undermined hopes of sustaining already struggling companies. Many retailers are emerging from the process after months of difficult negotiations.
J. Crew and Neiman Marcus have both received approval for their restructuring plans over the past month. Brooks Brothers has been acquired by SPARC Group, a joint venture between licensed company Authentic Brands Group and shopping center operator Simon Property Group. Meanwhile, New York City malls are allowed to reopen next week, but with a capacity of just 50 percent.
It comes down to: Thousands of jobs are at stake, as well as pieces of real estate that were once so sought after. What happens next will help define the post-pandemic shape of the US retail industry.
Luxury Watchmakers Court Consumers in Shanghai
- The Swiss watch fair Watches & Wonders is organizing an event in Shanghai next week
- Swiss watch sales collapsed this year hurt by pandemic-related store closures and less travel by Chinese consumers
- The show is dominated by Richemont, whose watch division saw sales decline in the three months ended June 30
In the lofty world of luxury watches, the annual Watches & Wonders fair is a big deal. This year it did not happen. Like so many of the big events in the industry, Covid was canceled and replaced with a digital event in April. But after a brutal season for the industry, it goes live in Shanghai next week. The five days of product launches, panel discussions and demonstrations are an opportunity to address the largest market in the industry.
Chinese consumers typically buy luxury items abroad, but with travel restrictions, domestic purchases have increased. While Swiss watch sales fell 17 percent worldwide in July, the most recent month for which data is available, sales in China were up 59 percent.
Richemont, whose watch brands love Piaget and Vacheron Constantin dominate the event, it needs consumers. Sales of the specialty watchmaking division fell 56 percent in the three months between April and June, contributing to an overall sales decline of nearly 50 percent. The group has halved the proposed dividend to save money this year.
It comes down to: Covid-19’s impact on hard luxury was brutal. With the industry settling into a new standard, brands must quickly adapt their marketing tactics to drive recovery.
Goop’s Wellness Summit goes digital at a discount
- In Goop Health, Gwyneth Paltrow’s lifestyle brand Goop’s series of wellness summits goes digital on September 12
- Tickets to the event range from $ 50 to $ 200, with a limited number of $ 5 discount passes available; it’s a bargain compared to over $ 1,000 for the personal version
- The “at-home summit” is hosted by Gwyneth Paltrow and Goop’s Chief Content Officer Elise Loehnen and includes panel discussions, experiences and workshops
Goop Health, a lucrative event series from Gwyneth Paltrow’s lifestyle brand Goop, helped a boom in beauty and wellness conventions. Like so many events disrupted by the coronavirus pandemic this year, it will go digital next week. On September 12, Gwyneth Paltrow and Goop’s chief content officer Elise Loehenen will host a series of online discussions, workshops and experiences, which will be available on a password-protected site until October 5.
The summits usually attract a crowd of well-heeled and wealthy customers – tickets usually sell for $ 1,000 and up – and serve as a great marketing platform for Goop products and merchandise. The digital format will be cheaper at $ 50, although there is a more expensive and already sold out $ 200 offer that comes with a set of Goop products. There are also a limited number of $ 5 tickets available in a nod to inclusivity.
It comes down to: Other event organizers struggle to generate profits digitally. Goop is controversial at times, but it sells.
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