Hudson’s Bay launching online marketplace, adding third-party sellers to its website
Hudson’s Bay Co. hopes to transform its website into Canada’s next online shopping marketplace in a bid to position itself as a premium, home-grown alternative to e-commerce heavy hitters like Amazon. The company will open its website to third-party sellers starting later in March, adding hundreds of new brands and thousands of items to its online assortment of products at a time when pandemic restrictions have curtailed in-person shopping.
The new site will include electronics and sporting goods, pushing the retailer beyond tried-and-true categories like clothing and home decor as it seeks to attract and retain customers who increasingly demand a strong online presence. The company has to find the right balance between maintaining its premium brand and expanding its inventory, executives said in an interview. “Although it will very much be a vast assortment, it will feel curated,” said Adam Powell, senior vice-president of omni customer experience.
Shoppers will have access to more products, some of which will be sold and shipped directly by Hudson’s Bay — and can be returned in store — while others will be sold and shipped by third-party sellers that also manage returns for those items.
The Hudson’s Bay marketplace, hosted on the Mirakl software-as-a-service platform, comes a little over a year after the iconic company was taken private. Although the company’s digital strategy was in place before the pandemic – the retailer relaunched its website last April using a new e-commerce platform from Salesforce – it has taken on more urgency amid lockdowns.
“This was the most logical way to really expand our digital first strategy at a supercharged rate,” Iain Nairn, said president and CEO of Hudson’s Bay. “It opens up thebay.com for one-stop shopping.”
Even post-pandemic, retail watchers say consumers will continue to shop more online and look for “omni-channel” options such as picking up online purchases at stores, while in-store shopping will focus more on interacting with products.
“It’s actually creating the store to be more exciting and have more experiences,” Nairn said. “There may not be as much absolute product but there will be more options for them to look at“ before they purchase online. The idea is to use stores as more of a showroom for products, with a wider selection available online and shipped directly to customers, Powell said.
Like the new HBC marketplace, some other online retailers like Best Buy, Walmart and Amazon also allow third-party sellers. Yet HBC is banking on the department store’s unique position as a Canadian retailer with a reputation for higher-end goods to attract customers. The company has about 225 million website visits a year and 5.6 million loyalty rewards members, numbers HBC expects will attract sellers interested in reaching Canadian shoppers.
Hudson’s Bay marketplace will feature large multinational third-party sellers of brand-name goods as well as smaller vendors, artisans and entrepreneurs, the company said. The retailer even issued a call out for “cool local and Canadian brands” with direct-to-consumer shipping capabilities and inventory on hand, providing a national platform for handmade products that might normally be sold on websites like Etsy, Facebook marketplace or Kijiji.
The focus will be on merchandise customers are already searching for, including technology, sports equipment, pet products, food and drink and health and wellness, Powell said.
“We can tell by our search results that these types of categories are products that our customers are already looking,” he said. “If Nintendo launches a new console, we see that coming up in our search results, so it won’t feel foreign to a customer to stumble upon these new categories that we’re going to be introducing.
“It’ll be a real natural extension from our existing business, and it’ll still be very much in keeping with the types of areas and quality that we want to portray with our customers.”
Source: Toronto Star
HBC sells stake in Saks online business for US$500M, makes it a separate company
HBC has signed a deal to sell a minority stake in Saks Fifth Avenue’s e-commerce business and turn it into a separate company, a move that will “redefine the luxury shopping ecosystem,” the company said on March 5. American private equity firm Insight Partners has agreed to invest US$500 million in the deal, which values the standalone business that will be known as Saks at US$2 billion, the retailer said. Saks Fifth Avenue’s 40 stores will operate separately as an entity referred to as SFA, which will remain wholly owned by HBC.
The deal highlights the ability of HBC to “unlock significant value” in its assets, which include retail, technology and real estate holdings, the company’s governor, executive chairman and CEO Richard Baker said in a statement. “Luxury e-commerce is poised for exponential growth, and as a standalone digital company with an existing strong position in luxury, Saks is primed to win significant market share,“ he said.
The sale of a minority stake in the luxury retailer’s e-commerce business comes amid a sharp rise in online retail sales during the pandemic. Moreover, retail observers have noted that while stores with mid-range prices have struggled during the COVID-19 pandemic, both discount and luxury retailers have emerged relatively unscathed.
“Luxury e-commerce is an exceptionally resilient high-growth sector,” Insight Partners’ managing director Deven Parekh said in a statement. “We are excited to invest in an iconic century-old brand that has so successfully morphed to a native digital strategy.”
HBC said Saks and SFA will be better able to plan and invest in their respective models as separate but related companies. Saks Fifth Avenue will remain as the customer-facing name for both businesses and the customer experience moving from the brick-and-mortar stores to online will be seamless, HBC said.
While the two Saks businesses will collaborate – for example, continuing to allow customers to return online purchases in stores – HBC is hoping a separate Saks.com entity will attract more investment. Saks will feature a hybrid retail and marketplace platform, expanding its assortment while maintaining a curated experience, HBC said. Marc Metrick, previously president and CEO of Saks Fifth Avenue, will serve as CEO of Saks and a member of the company’s board of directors. Larry Bruce will be president of SFA.