We’re taking suggestions for Canada’s top retail stories of 2013. We’ll report them towards the end of the month. We expect that a few suggestions will be obvious, including such stories as Loblaws buying Shoppers Drug Mart and Sobeys buying Canada Safeway.
What news stories do you think we should include in our top 10 of 2013? Please feel free to submit your choices below, on our Facebook page, or to our Twitter feed.
By Melissa R.
Sources tell us that the 3,200 square foot Lululemon store at West Edmonton Mall has sales of approximately $26 million, making it the highest selling store in the company. It also makes it one of the most productive retail spaces in North America with sales of about $8,125 per square foot/year.
The store is on the mall’s second level, steps east of its skating rink called ‘The Ice Palace’.
Lululemon currently enjoys some of North America’s most productive retail space. Sales average US$1,936 per square foot/year, behind Tiffany & Co. at $3,017 a square foot per year and Apple Stores at $6,050 per square foot.
It has been an interesting year for Lululemon, which lost approximately $67 million this year due to the Luon sheer pant recall. CEO Christine Day subsequently announced she would be stepping down, founder Chip Wilson came under fire for comments blaming the sheerness of the pants on the size of women wearing them, and the company is still receiving complaints over the Second Chance pants that were made to replace the original Luon pants. Last week, Chip Wilson resigned from his position as Chairman.
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David Yurman‘s first Canadian store has opened at Toronto’s Yorkdale Shopping Centre. The 1,837 square foot store enjoys a corner location in close proximity to other upscale retailers including Salvator Ferragamo, Cartier, Tiffany & Co., Burberry, Mulberry and Tumi.
For those unfamiliar, David Yurman is a NYC-based designer of fine jewellery and luxury timepieces. The company was founded in 1980. There are 26 David Yurman store locations in the United States as well as two stores in France and one in Hong Kong. Collections are also carried at fine jewellers and American department stores such as Saks Fifth Avenue, Neiman Marcus and Bloomingdale’s. David Yurman products can also be found at selected Holt Renfrew stores in Canada.
David Yurman was first announced as a Yorkdale tenant in March 2013. A source tells us that David Yurman could open further Canadian store locations, including possible store locations in Toronto’s Yorkville area as well as in Vancouver.
“We’re proud to make a home for ourselves in Toronto,” says David Yurman’s President and Chief Commercial Officer,Carol Pennelli. “The decision to expand into this market was driven by a loyal and avid following of Canadian clients that have been shopping with us for years in the US. We’re thrilled to be a part of this diverse and vibrant community, and look forward to introducing our brand to an entirely new customer base.”
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Toronto’s Yorkdale Mall to Open David Yurman, All Saints, Varvatos, Ferragamo and Other New Stores…
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| Rendering: Jason Goldstein LLP |
Renderings have been released of the proposed 120,000 square foot Holt Renfrew store at Mississauga’s Square One Shopping Centre. The store will anchor an expansion of the south-west portion of the mall.
The Square One Holt Renfrew is being designed by New York City-based architect Jason Goldstein. Goldstein appears to have become Holt’s architect of choice for store design. His projects have included purpose-built Holt Renfrew stores in Vancouver (2007) and Calgary (2009), as well as Holt Renfrew’s Yorkdale store expansion.
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| Rendering: Jason Goldstein LLP |
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| Rendering: Jason Goldstein LLP |
Holt Renfrew announced its new Square One store in April. For further details of the store and the mall’s expansion, we direct you to our previous article.
Thank you to officedweller of Urban Toronto for posting the Jason Goldstein renderings.
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Last month we asked readers what stores they’d like to see in Canada, and responses flooded in. Here are your top 10 choices:
1) Uniqlo
2) DSW Designer Shoe Warehouse
3) Muji
5) Trader Joe’s
6) Kohl’s
7) Macy’s
9) Madewell
(by J. Crew)
Many of these choices are of no surprise to us. Our articles about Uniqlo consistently have the highest readership on Retail Insider and given Uniqlo’s popularity, it’s very surprising it hasn’t already opened in Canada. We’ve been told that Uniqlo could still be introduced to Canada through the Hudson’s Bay Company, though we’re not aware of the progress of any current negotiations.
DSW Designer Shoe Warehouse was also an expected choice. The company carries thousands of pairs of shoes. We’ve got good news: DSW is already looking to expand into Canada To make things even better, The Shoe Company is reportedly looking to open a chain of similar shoe stores Bloomingdale’s could open in Canada and for a while it was in talks with The Hudson’s Bay Company to open in-store concessions. The deal unfortunately fell through, though Hudson’s Bay instead bought Saks Fifth Avenue, which it will bring to Canada within the next couple of years.
Specialty grocery store Trader Joe’s is definitely a top pick of ours, and we think reasonably priced organic food would do well in Canada. We’re not yet aware any intentions for the company to open in Canada. Interestingly, an attempt by a Vancouver-based entrepreneur to sell Trader Joe’s products in Canada was met with litigation Kohl’s is looking at the Canadian market, though it may be deterred by recent problems encountered by Target’s Canadian expansion. We’ve been told that Kohl’s could be a possible purchaser of Sears Canada, though we’ve also been informed that Sears Canada could be purchased by a large Canadian retailer (and we don’t mean Hudson’s Bay).
Macy’s was a surprising choice in our opinion, given how similar it is to our own Hudson’s Bay. Having visited both stores regularly, we’re seeing Hudson’s Bay actually surpassing Macy’s as a retailer in many respects, and we’ll do an article specifically discussing this.
We’ll be contacting these retailers directly, letting them know that you want them in Canada. Are there any other stores you’d like to see open in Canada? We’ll update this article in the New Year. Please leave your comments below or follow this link to our Facebook page. Also, you can leave comments via our Twitter
The opening date of La Maison Simons‘ store in Ottawa’s Rideau Centre has been delayed. It is now scheduled to open in August 2016, where it had originally been scheduled to open in the spring of 2015. It will therefore be the second Simons store to open in the Ottawa area, about one year after the recently announced Simons at Les Promenades Gatineau which will open in the spring of 2015.
The Rideau Centre Simons store will be about 105,000 square feet and will feature a reconstructed facade of the historic Ogilvy building formerly occupying the store’s site. Rideau Centre’s mall expansion will include 230,000 square feet of new retail space over four levels, as well as a modernization of the mall’s common areas. A 35,000 square foot upscale food court with 16 eating establishments seating 850 (complete with ceramic dishes, glassware and metal cutlery) will be available to shoppers as well as a new three-level underground parking garage. Joining Rideau Centre will be a 157,000 square foot Nordstrom store, which is still scheduled to open in the spring of 2015.
We were alerted to the delay in the Rideau Centre Simons’ opening after a press release was issued claiming that Mississauga’s Square One Shopping Centre would be the first Ontario location for Simons. That press release appears to have been correct.
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| Holt Renfrew, Calgary. Photo: Darrell Bateman |
Sources tell us that Holt Renfrew will be opening the fourth floor of its Calgary store for retail, including a new restaurant and a combined mens/women’s shopping area called ‘Holts Commons’. The fourth floor restaurant is said to open in early 2014.
When Holt’s opened its Calgary store in October 2009, it left its fourth floor shuttered so as not to ‘overwhelm’ the Calgary market with a store more than triple the size of its previous Calgary store. When its huge Vancouver replacement-store opened in 2007, sales struggled as shoppers adjusted to the new, larger (Neiman Marcus-like) format. Holt’s subsequently figured its Calgary location should ‘graduate’ to a larger size as it saw sales increase.
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| The 4th floor of Calgary’s Holt Renfrew is said to open early 2014 |
On opening day, the 25,494 square foot fourth floor of Calgary’s Holt Renfrew laid vacant while shoppers were introduced to the stunning 121,400 square foot store below. When the fourth floor opens next year, Calgary’s Holt Renfrew will be the second largest in the chain at 146,887 square feet (second only to the Toronto flagship store). Vancouver’s Holt Renfrew will fall back to be third largest at about 140,400 square feet.
More changes will be coming to Calgary’s Holt Renfrew store. We’ll be announcing them periodically as it grows into its enlarged store space.
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| Women’s Designer Floor, Holt Renfrew, Calgary. Photo: Darrell Batemen |
According to the November 27th edition of the The Globe & Mail Report on Business, Saks Fifth Avenue CEO Richard Baker says that he’ll open up to eight Saks Fifth Avenue stores in Canada, including suburban locations in or near Toronto, Montreal and Vancouver. Based on Baker’s comments, we’re providing an updated list of which suburban Canadian malls are likely to receive a new Saks store. We also have an update on potential downtown stores: they might not go into current flagship Hudson’s Bay store space, after all.
The Globe & Mail article says the following about Richard Baker:
“He’s also weighing setting up Saks in Calgary, and in suburban Toronto, Montreal and Vancouver—up to seven or eight Canadian Saks in all, he says. He’s already negotiating for space in major suburban malls such as Toronto’s Sherway Gardens and Yorkdale.”
Given the above statement, we have an update on what suburban locations we think Saks Fifth Avenue could open in Canada. We’ll specifically address potential suburban locations.
The first two locations we’ll discuss are the obvious ones which were mentioned in the article: Toronto’s Sherway Gardens and Yorkdale Mall. The second two might be less obvious. We speculate that the Vancouver store location could be at Oakridge Shopping Centre, and that the suburban Montreal store could be at Le Carrefour Laval.
Yorkdale Shopping Centre, Toronto: Richard Baker may be negotiating for the entire 190,000 square foot Sears store location that was recently sold back to landlord Oxford Properties. The store enjoys a prime location next to an expanded flagship Harry Rosen store and is between an upscaled Hudson’s Bay and a substantially expanded and modernized Holt Renfrew store. We had initially expected a Yorkdale Saks to be established within part of Hudson’s Bay’s 303,000 square foot store, though now it appears Richard Baker is willing to spend substantially more money on Canadian Saks stores than we had originally anticipated.
Saks could have some competition for the Yorkdale Sears space, however. La Maison Simons has expressed interest in leasing part of the space. Furthermore, the mall’s landlord has also stated that it may wish to demolish Sears in order to expand Yorkdale Mall into that space as well as the adjacent parking space.
Nordstrom will join Yorkdale in 2016 with a new 188,000 square foot store, in part of a 298,000 square foot mall expansion.
Sherway Gardens, Toronto: Saks could occupy part (or even all) of Sherway’s 225,000 Sears store location which Sears recently sold back to landlord Cadillac Fairview. We again have changed our thoughts on where Saks could go. We were expecting Saks to open a shop-in-store within suburban Hudson’s Bay stores, but after last week’s article in the Globe & Mail, it appears that Richard Baker is willing to spend money to build large free-standing Saks stores. We think 225,000 square feet might be a bit too large for Saks at Sherway, however – only two American Saks locations are larger than 225,000 square feet, and both are ‘urban’ flagships, being the Manhattan (646,000 square feet) and Beverly Hills (275,000 square feet) stores.
Sherway Gardens is a sufficiently upscale mall for Saks, and it features other upscale tenants including Holt Renfrew (which may stay in the mall, despite its building a 120,000 square foot store in nearby Mississauga) and, in 2016, a 138,000 square foot Nordstrom store.
Oakridge Shopping Centre, Vancouver: Saks had already been inquiring into space at Oakridge Centre, and Oakridge’s landlord is looking to fill a proposed 155,000 square foot anchor store with an upscale American department store. Though it wouldn’t open until some time around the year 2020, an expanded Oakridge Centre could become home to a Saks store.
Carrefour Laval, suburban Montreal: Given the possibility that Saks could open in suburban Montreal, our best guess for its location would be Carrefour Laval. The mall enjoys an affluent shopping base and its landlord, Cadillac Fairview, is keen to make improvements to the mall. We’re not sure if Saks could take over the mall’s current Sears store, or if it would want to – the mall’s Sears store is a bit removed from other upscale retailers and is itself neighboured by some more mid-market stores. We’re not aware of mall restrictive covenants though it’s possible that a purpose-built Saks could arrive in the mall within a few years.
Besides these four suburban store locations, we expect at least three downtown Canadian Saks stores: one in Toronto (replacing Hudson’s Bay at Yonge and Bloor) as well as in Vancouver and Montreal. Sources have informed us that Saks management may want to create free-standing downtown stores rather than locate within flagship Hudson’s Bay stores in Downtown Vancouver and Montreal. An eighth possible Saks store could be somewhere in Calgary.
We’ll be watching Saks closely and we’ll let you know when we learn of where Saks will open in Canada, including where possible free-standing downtown stores may be located.
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By Dave Rodgerson, Retail Industry Analyst and Consultant
Dave Rodgerson is a Retail industry expert with more than 25 years of executive experience working with leading Canadian Retailers in sales, marketing, operations and strategic planning roles. He works closely with both clients and associations that share an interest in enhancing the consumer experience. Mr. Rodgerson’s expanded bio is provided at the end of this article.
The 2013 shopping season is one of the shortest in history. With only 26 days between Thanksgiving and Christmas its 6 days shorter than last year. The end result is that retailers have almost a full week less to capture the business available to them through the holiday season. That has prompted a number of analysts to suggest that Thanksgiving 2013 would be a bigger shopping day that it has been in the past. The projection was accurate. According to IBM’s Digital Analytics Benchmark report, Thanksgiving saw a year-over-year increase of 19.7%. The “early” start to the shopping season may prompt retailers to allocate more focus on Thursday as the drop date for future promotions coming into the week. In Canada the day isn’t recognized as Thanksgiving or a holiday, but that didn’t prevent some retailers from tagging the day as “Grey Thursday”. Analysts at Accenture have suggested that in time, Thursday could become the largest sales day of the week. It makes sense when you think of the competitive nature of retailers and the challenge of capturing as much business as possible in a short window of time.
It was interesting to note that the largest change in Thanksgiving shopping came in the form of mobile transactions. In the past, shopping on mobile devices has traditionally stayed below 20% of total online volume. This year, 25.8% of online sales were generated by mobile devices.
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Black Friday did not disappoint the retailers either. The day achieved a record high in online sales growing 18.9% over the same day in 2012. In spite of this increase, the average basket size for Black Friday online orders only increased by 2.2% over 2012. What this does confirm is that the growth in online sales is not coming from increased individual spending, rather, it is the result of more people shopping online during this period. There are two things that contribute to this change in shopping behaviour; consumers are becoming more comfortable with the technology used to make purchases online as well as having a greater trust in the security of shopping online
There is an interesting split in the use of mobile devices during the Thursday to Monday shopping period. Smartphones drove 24.9% of all online traffic on Black Friday compared to tablets at 14.2%. In this sense they established themselves as the device of choice for browsing. They are much easier to use when shopping in stores as well, since most retailers do not offer Wi-Fi and most tablets are not equipped with 4G connectivity. Tablets were however the device used more frequently to complete purchases. Tablets drove 14.4% of online sales, smartphones accounted for only half that figure at 7.2%. Tablets also captured a larger basket than sales attributed to smartphones by almost 19%.
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Cyber Monday did not disappoint anyone. Online sales grew by 20.6 percent over 2012. The average order value was $128.77, down 1 percent year-over-year which again makes the point that more people are making the shift to shopping online.
Cyber Monday also generated a higher conversion rate on carted items. Shoppers actually purchased the items they added to their online shopping carts at a 12.6 higher rate on Cyber Monday than Black Friday.
Another trend that is becoming more apparent as online shopping increases through the holiday season is the influence of social media. Websites like Pinterest and Facebook are generating some of the traffic that contributes to online sales. While this percentage is small, (less than 1%) there is a growing trend of shoppers who are referred from these sites to online retailers. On average, holiday shoppers referred from Facebook spent 6 percent more per order than shoppers referred from Pinterest. Facebook average order value was $97.81 versus Pinterest average order value which was $92.40. Facebook referrals converted sales at a rate 38 percent higher than Pinterest.
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It will be interesting to watch how retailers connect with mobile shoppers in the future. On average, retailers sent 77 percent more push notifications during the five day holiday shopping period (the alert messages and popup notifications from apps installed on your mobile device), when compared to daily averages over the past two months. The average daily installation of retail application on smartphones also grew by 29 percent using the same comparison. This would seem to indicate no loss of appetite on the part of consumers for smartphone tools that enable their shopping.
“We continue to see a dramatic movement of the new digitally savvy consumer as Cyber Monday once again proved to be the star of this holiday shopping season,” said Jay Henderson, Strategy Director, IBM Smarter Commerce. “The mobile device has become the shopping companion of choice for consumers, driving record mobile sales with 55 percent growth over last year.”
About Dave Rodgerson
La Maison Simons will open a 113,000 square foot store at Mississauga’s Square One Shopping Centre in the spring of 2016. The two-level store will be the anchor of a $52 million reconfiguration of the mall’s current 145,000 square foot Sears space which was recently sold back to mall landlord Oxford Properties.
Simons will join a 120,000-square-foot Holt Renfrew store that is also set to open at Square One in spring 2016.
Simons is the newest retailer added to Square One’s $380 million renovation and expansion project. Phase One, an $84 million overhaul of the interior, was completed in November 2013, and construction on Phase Two began in September 2013.
Square One’s Sears location Simons joins anchors Hudson’s Bay (191,000 square feet), Target (164,000 square feet) and Walmart (245,000 square feet). As mentioned, Holt Renfrew’s Square One store will be about 120,000 square feet when completed.
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