The Room at The Bay | BCBusiness
The sales of luxury goods are up in Vancouver, and high-end retailers are clamouring for elite shoppers' attention.
Vancouver retailers are catering to a new breed of luxury shopper by taking high end to decadent new heights.
On a recent Wednesday night in downtown Vancouver, a group of well dressed 20- and 30-something female executives from the non-profit group YES (Young Executives for Success) gather to network and take in a fashion show featuring designers such as Hugo Boss, Halston Heritage and McQ by Alexander McQueen. The women sip white wine and nosh on sushi lollipops from C Restaurant as the models sashay into the room and emcee Fiona Forbes from Shaw TV Vancouver’s Urban Rush keeps things moving along.
What makes this event unique is the location. It isn’t taking place at a hotel, a private club or even a restaurant, but rather at Hudson’s Bay, the place where you buy your socks. Scratch and Save has gone upscale, big time.
The Bay unveils luxury shopping spaces
In 2010, the Bay unveiled White Space at its downtown Vancouver store. The starkly modern, white-tiled area within the store showcases upscale contemporary designers, with prices ranging in the mid-hundreds. In September 2011, the department store went a step further in courting upscale shoppers by opening its ultra-exclusive boutique, the Room. The 23,000-square-foot space adjacent to White Space houses 35 designer and runway brands and has exclusive rights in Canada to Jeremy Laing, Halston, Claudia Schiffer Cashmere and DSquared2. Prices range from $1,000 up to $20,000.
White Space and the Room are part of the Bay’s bid to reinvent itself for the Canadian shopper. It is also a signal that while the economy is in the throes of a recession, luxury is here to stay.
According to Statistics Canada, jewellery, leather and luggage sales in Vancouver were up 21.7 per cent in August 2011 compared to the same month the previous year, while total retail sales were up only 3.8 per cent. In B.C., jewellery, leather and luggage sales showed an increase of 15.3 per cent August to August, while total retail sales for the period were up a modest 4.1 per cent.
Shafiq Jamal, western vice-president of the Retail Council of Canada, confirms that despite a stagnant economy, luxury sales are on the upswing. “We are hearing and seeing that the one category of product continuing to escape the economic malaise is luxury,” he notes. “Retailers selling high-end merchandise almost unanimously report to us that they are experiencing double-digit growth.”
According to long-time Vancouver fashion stylist and editor Catherine Dunwoody, there is a percentage of the population that appears to be untouched by the recession. “New high-end stores are still opening and they are not doing clearance sales,” says Dunwoody. One of those stores is Tiffany & Co., which announced in August last year that it would be opening a second location in Vancouver, its fifth location nationwide.
Colliers International retail analyst James Smerdon says that with the Room, the Bay is specifically targeting the affluent market in urban environments, which in the last several years has seen substantial growth. “There is a fracturing of the retail sector,” says Smerdon. “You need to reposition yourself as discount or high-end to survive. The Bay is looking to maintain and regain relevance in the fashion and apparel markets that it has lost after 20 to 30 years of being directionless. They had to do something.”
Benefits by design[er]
There are additional benefits to catering to a market that is out of reach for most of us. “It is partly about offering luxury product and partly upping the ante,” says Dunwoody. “The Bay now has designer labels that no one else has. The fashionista who used to scoff at the Bay can’t do that anymore. It is a game-changer.”
The Bay now has the ability to draw in brand-conscious aspirational shoppers who might take a peek at the Room, and maybe even buy on occasion, and then shop in other parts of the store. Room customers can also be redirected by trained sales staff to another department to buy dishes for their Whistler cabin.
McElhone estimates that prior to 2008, the luxury retail sector represented 25 per cent of the global retail market, while today it represents 15 per cent. That means it’s tougher than ever to compete for shoppers’ dollars, and the top-end consumer has to be marketed to within the current economic climate. “Luxury brands have to be aspirational, but in a more pragmatic way, given the economic times we live in,” explains Jamal. He adds that successful marketing campaigns emphasize the reliability of the brand in today’s changing world, emphasizing that the consumer deserves the item because they have worked hard.
Dunwoody points out that luxury shoppers are less visible in today’s post-9/11 world, and that may help explain why, during a recent weekday stroll past the high-end retail shops lining Burrard and Alberni streets in downtown Vancouver, sales staff folded sweaters and scarves in virtually empty stores. “They might shop online. They don’t necessarily want to be running around the street with fancy bags,” says Dunwoody. “There is a state of mindfulness.”
At the Room, the ambiance is part art gallery, part retail space. Metal screens and a three-dimensional wall featuring white flower rosettes serve as a backdrop for the designer fashions and shoes that line the walls. In the back of the Room is the Platinum Suite for VIP customers, complete with a valet, private fitting room, lounge area and makeup bar.
“The affluent customer is becoming more discerning, holding luxury to a higher standard and demanding a more enhanced and refined store experience,” explains Jamal. “To put it another way, it is no longer enough to offer a high-end customer a cup of tea while they are contemplating an expensive purchase. They want champagne and truffles.”
And high-end service extends beyond the VIP suite. Sarah Bancroft, western style and fashion guru and founder of VitaminDaily.com, notes that while she was recently lunching at Hawksworth Restaurant in downtown Vancouver she spied a Hudson’s Bay personal shopper taking a client to lunch. “That is exactly what the Bay should be doing,” says Bancroft. “We have all been there, where we are trying to buy a pair of shoes and end up in the linen department looking for a salesperson. On the high-end, the store experience cannot feel discounted, and one-on-one personal shopping is key.”
“Any specialty retailer is looking for repeat, referral business and a one-to-one relationship with the client,” adds McElhone. “It is an experience, an escape.”
The strong presence of luxury retailers in Vancouver
Vancouver-based retail analyst David Ian Gray of DIG360 Consulting Ltd. cautions that while the market for high-end fashion may remain healthy, there are a number of additional reasons why luxury retailers continue to have a strong presence locally. A strong tourism industry and a wealthy immigrant population make Vancouver an ideal location for any store catering to the economic elite, he says. In addition, luxury retailers can be part of a large corporation or public company that has the ability to weather a shaky economy. “This is not a boom time for retail,” says Gray. “Luxury retail may be the exception.”
Says Bancroft: “Holt Renfrew has been the Air Canada of high-end retail for so long. They have completely dominated the market. It is super refreshing, in any industry, to see more players in the market.”