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It was the ultimate strategy session.
The FN Summit, held last Monday at the Asia Society in New York, brought together top vendors, retailers and designers who are shaking up the industry.
The executives sounded off on everything from building powerful brands and compelling retail concepts to keeping up with the fickle consumer through smart digital programs and product initiatives.
To find out how these change agents are leading the way, read on for highlights from the event.
In a complex, rapidly shifting footwear market, innovation is the key to success. That was the message from executives at three leading retailers — Famous Footwear, Pedder Group and Level Shoe District — who took the stage to discuss their diverse strategies.
Staying fresh and constantly looking for engagement points online and in-store is critical to ensuring Pedder’s future growth, said Peter Harris, president of Hong Kong-based Pedder Group.
“The fascination now is in modernity,” he said. “Our challenge is to not be complacent. There isn’t one retail format. There isn’t one size fits all.”
The company, which manages more than 250,000 square feet of retail space in the eight cities in Asia, is moving fast to meet the demands of an evolving consumer.
“In China, the middle-class customer upgrades to luxury quickly, which is a big challenge for us. By being a part of the fabric of the community and on the ground, we can reach them. The customer in China is modernizing, not Westernizing,” said Harris.
One way the retailer partners with brands is through its Blitz collaboration program, which has featured labels such as Manolo Blahnik and Stubbs & Wootton, in special spaces at Lane Crawford.
Beyond exclusive product, the firm is pumping up its digital presence, too. For example, Pedder recently created a music video with Korean pop star CL as part of its Kenzo launch.
Famous Footwear has been focusing more heavily on digital efforts as well. President Rick Ausick recalled that as part of parent Brown Shoe Co.’s repositioning, Famous put the brakes on store expansion three years ago, turning its focus to developing a mobile app, which launched last year.
On the broader topic of omnichannel, Ausick pointed out the movement is nothing new for the family footwear chain. “It’s one of those things that everyone is talking about today, but we’ve been in that business for years. The next evolution of having our dot-com orders ship from stores is happening as we speak.”
He noted that is crucial to help the retailer compete against e-commerce players, and the firm is working to cut its delivery times to hours from days. “[Online sellers] have the capability to move faster and build their whole business model around speed. We don’t know that we’ll ever be able to compete that way,” said Ausick. “But we can at least be in the game. If we’re not there, we’re going to lose to our competitive set.”
The chain also has culled its real estate footprint to boost profitability. “We’ve had negative store growth. We’ve closed more stores than we’ve opened,” he said. “We’ve relocated bigger spaces into smaller spaces, so we’ve been able to take our sales per square foot up about 15 percent or 18 percent over the last three years.”
But store growth could ramp up at Famous Footwear. Ausick said the firm plans to bow five to 10 additional doors in 2014 and ’15. “And in the next two or three years, you could see a little more rapid store growth,” he added.
One of the chain’s target markets is Canada, where it added a second location last month, in a Tanger Outlets Center on the northern side of Niagara Falls.
Ausick pointed out the store is performing well so far, even though Famous already has a presence on the American side of the falls. “Yes, we’ve lost a little business on the U.S. side, but the volume we’re doing in Canada is much more than compensating for that,” he said. Later this year, the retailer will debut four more doors in Canada, with seven additional stores planned for 2015.
On the product front, Ausick said Famous had a big win this spring with canvas footwear and has doubled down for the all-important back-to-school season.
“It’s a business we’ve invested in for 10 or 12 years,” he said. “We built that customer around the idea that the key brands would be represented in our stores, with new product and colors and sizes. Sometimes you go get the trend and sometimes it comes to you, and that happens to be the case here.”
Level Shoe District in Dubai has been working to fuel growth across all product categories, from luxury and contemporary to men’s and sneakers, according to Rania Masri, GM of retail for parent company Chalhoub Group.
Dubbed the largest shoe store in the world, at 96,000 square feet, Level, which opened in the Dubai Mall in 2012, capitalized on the market’s accessories-driven shoppers, Masri said. Indeed, Middle Eastern consumers spend $2.8 billion on fashion each year, and 20 percent of that is on footwear, according to the executive.
“We considered this an opportunity,” she said. “We haven’t reinvented the wheel [with our large format]. ... The most important thing is offering a luxury experience, but don’t limit the offering to that. We want [to provide that] even if you are buying Havaianas.”
Part of the firm’s strategy calls for a comprehensive selection of brands from a variety of tiers. Uniqueness is also a priority, and the store launches 100 exclusives each season.
Additionally, Level has backed a number of emerging designers and looks to social media to promote a busy schedule of in-store events.
“We don’t have a heritage [to fall back on], so we need to be innovative with social media,” Masri said, adding that the interactive relationship has informed the inventory. “The challenge was to talk to consumers and curate the space [based on those conversations].”
And while Chalhoub Group does not plan to take the concept to any other international locations, e-commerce will launch in the next year.
“We want to focus on omnichannel and offer the same experience [online that you would get in the store],” Masri said.