Management said SFA had become overly extended, and that the strategic and tactical quality of its real estate was “poor.” But this is changing as the new management team, led by Wilson, redefines the image of the company.
Wall Street is expected to respond today to the new strategy.
The announcement of a revamped vision confirmed a December report in WWD.
Wilson said the opportunity to join SFA was one he couldn’t refuse. “Saks was just so compelling. It was, as we say in the trade, a no-brainer.”
He acknowledged there were challenges ahead. During his transition to SFA from Donna Karan, Wilson said, “We kind of knew where we were going [at Saks] and we kind of knew what we were about, but we weren’t clear.”
First on Wilson’s agenda was figuring out a clear vision for the company. The solution evolved into a “DNA change” for the company that Wilson described as “our own secret recipe.” Some of the changes in the turnaround initiative have been completed. The company has a focused agenda now, and more work still needs to be done, but Wilson said the company “will be relentless in our execution of that vision.”
The retailer has done some soul-searching before, crystallizing its vision for the future. Executing a new vision required a complete recasting of the retailer’s mind-set. Out are tired words such as “department store,” and luxury that used to be characterized by “Ladies Who Lunch,” management said. In are phrases such as “high performance” and “risk-embracing.”
In conducting focus group research, the SFA team noticed that it didn’t matter whether members of different demographic slices had annual household incomes of $100,000 or $250,000. Some spent $1,000, while others easily dropped $35,000 at the store. But the retailer learned they all had one thing in common: the shoppers spent their dollars at Saks because of a personal connection with someone at the store.