Consumer Report 2015: How Holt Renfrew is preparing for Nordstrom

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How two iconic Canadian brands are gearing up (or not) for the arrival of customer service king Nordstrom in downtown Vancouver

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The burbs go upscale

With the opening of Seattle-based Nordstrom’s third Canadian store (and first in Vancouver) on September 18, there will be three major department stores clustered around the intersection of Granville and Georgia—each competing for the same high-end shopper. In a market that’s clearly heating up, luxury icon Holt Renfrew is expanding its footprint by 30 per cent and adding new merchandise and amenities, from a private apartment to a 3,500-squarefoot café overlooking Howe Street. At Hudson’s Bay, however—which has undergone a nationwide facelift and upgrade in recent years—the response appears somewhat more muted.

THE CHALLENGER: Nordstrom

Nordstrom is new to Vancouver but not to Vancouverites. “Here in Seattle we’ve been serving Vancouver customers for a long time,” says Jamie Nordstrom, the company’s president of full-line stores, Nordstrom. “We’re really looking forward to serving customers in their hometown.”

The timing of the company’s arrival in Canada (starting last year) is partly because it was able to snag several prime locations, especially in Vancouver. “It is a great location,” says the 42-year-old great-grandson of company founder John W. Nordstrom. “We’re humbled by having this location that is truly kind of the centre of the universe in Vancouver, and we think that we have a responsibility to make it a great store. And not just one of Vancouver’s great stores—one of Canada’s great stores.”

The company believes Nordstrom Pacific Centre could be the company’s top-volume store in a couple of years. “It’s going to be our full flagship experience,” says Jamie Nordstrom. “Whether it’s food and drink experiences or unique merchandise that you’re not going to find anywhere else in the city in addition to great service, we want this to be a store that people say, ‘Hey, if you’re going to go to Vancouver, you’ve got to go check out Nordstrom.’ We want to be that kind of store.”

While Nordstrom is famous for its singular focus on customers, there aren’t a lot of rules regarding what staff needs to do to make customers happy. Just figure out why they came in the store and then give them a great experience, says Jamie Nordstrom. “If we do that, then we’re feeling pretty good about our chances. We think that we’re going to be doing business in not just Vancouver but in Canada for a long, long time. And now is just the start.”

INCUMBENT NO. 1: Holt Renfrew

By the end of 2016, Holt Renfrew Pacific Centre promises to be 40,000 square feet bigger and even more luxurious than it currently is. In addition to significantly expanded jewellery, leather goods, footwear and menswear collections, the store will have a 1,000-square-foot apartment for private showings plus an 80-seat Holts Café tailored to Vancouver tastes.

As Holt Renfrew’s Toronto-based president, Mark Derbyshire, puts it, Vancouver is a cosmopolitan city with a distinct sense of style. “Luxury isn’t new to Vancouver. But I think we’re raising the ante on luxury in Vancouver through what we’re doing in this shop.”

Holts sees itself as Canada’s destination for specialty luxury retail, which sets it apart from other stores. “We’ve never seen ourselves as a department store,” says Derbyshire. “We see ourselves as a specialty luxury shop that is able to bring you unique experiences. Our aspiration isn’t about being the biggest. Our aspirations are about being the place where you feel comfortable—a place that will challenge you on the curation of product, on the experience, on the architecture, on the in-store experience with the sales associate.”

The customer experience is designed to be identifiably Holts yet different in each location. While all the shops should still feel like Holt Renfrew, says Derbyshire, the experience in Vancouver should be different from the experience in Montreal or Calgary or Toronto. “We’ve built a shop there that I believe reflects Vancouver. So it’s gone and looked at the world but it’s done that through the eyes of Vancouver.

“We’ve called the city home for a very long time and made some big investments over the last decade—and there’s lots more great things to come.”

INCUMBENT NO. 2: Hudson’s Bay

In one form or another, Toronto-based Hudson’s Bay—North America’s oldest company—has been around since 1670, and at Granville and Georgia in Vancouver since 1893. The Vancouver store has been expanded and renovated numerous times, most recently after its purchase by American property mogul Richard Baker in 2008.

“We have been investing in our stores across the country as part of our ongoing strategy and Vancouver has always been a very important market for Hudson’s Bay,” says company president Liz Rodbell, who notes that the Vancouver downtown flagship was the first to debut Hudson’s Bay’s new branding and upgraded customer experience during the 2010 Olympics.

In recent years, says Rodbell, the Vancouver store has renovated its men’s department, “creating a compelling, one-stop destination on the sixth floor. We’ve expanded our ladies footwear and contemporary departments and introduced new brands to our cosmetics department including Kiehl’s, Shu Uemura and YSL. Topshop and Topman is exclusive to Hudson’s Bay in Canada and continues to be a strong business for us, and the Vancouver location is the second-largest in North America.” According to Retail Insider there are also plans to overhaul the third and fourth floors, including exposing the windows for more natural light.

Like Nordstrom, the new Hudson’s Bay has made a broad selection of both branded and private-label fashions one of its hallmarks, although it also sells home furnishings and has the largest bridal registry in the country. It has also stolen a page from Nordstrom with a reinvigorated focus on the customer experience; brighter, airier spaces; and more-stylish, less-cluttered displays.

While Hudson’s Bay declined to comment on a specific strategy to address Nordstrom’s arrival in Canada, industry observers think the imminent arrival of HBC brand Saks in Canada—starting in Ontario in 2016—will offer the most direct competition to its Seattle rival. As for when Saks might open a Vancouver location, that remains to be seen.



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