Craig and Lee talk about HBC’s recent announcement that the company is separating its physical department store business from its online operations, and what it means for the future of the retailer. Craig has some choice words when discussing the lack of investment in Hudson’s Bay stores resulting in their current lacklustre condition.
The Weekly podcast by Retail Insider Canada is available on Apple Podcasts, Stitcher, TuneIn, Google Play, or through our dedicated RSS feed for Overcast and other podcast players. Also check out ourThe Interview Seriespodcast where Craig interviews guests from across the Canadian retail landscape as part of theThe Retail Insider Podcast Network.
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Background Music Credit: Hard Boiled Kevin MacLeod (incompetech.com). Licensed under Creative Commons: By Attribution 3.0 License. http://creativecommons.org/licenses/by/3.0/
The Perth, Scotland-based company, in partnership with EML Payments Limited, has launched the new program after successful existing gift card systems for Prince Edward Island and Peterborough, which were launched late last year.
New ‘Downtown Dollars’ systems are being launched in Downtown Sudbury and Downtown London.
Andy Monaghan, CEO of Miconex North America, said downtowns are looking for new ways to stimulate the economy.
“In any Canadian province, there are multiple organizations focused on the success of businesses, from DBIAs and local Chambers of Commerce to local government. As well as stimulating the economy, these organizations naturally feel they have a role to play in bringing consumers back. A gift card system is a tangible way that they can support small, local businesses. It also means they can be ready for the holiday period when demand for gift cards will rocket.
Image: The Boro Gift Card for Peterborough DBIA
“In Canada, the average spend on gift cards is $465 per year, per person. There are millions, even tens of million dollars being spent in each community. This significant amount of money goes to the big national and international chains and internet retailers. Introducing a program means provinces like Ontario and Prince Edward Island can harness that spend, and take their fair share of the gift card market.
“But if places can move a step beyond this, and see their program not as a gift card but a local currency, it paves the way for innovative tourism initiatives like we’ve seen on Prince Edward Island and disbursement of funds to local residents. There is an opportunity to be hugely creative. Our job at Miconex is helping provinces to figure out the challenges they’re facing right now and a plan for success that benefits the whole community.”
Miconex was founded in 2010 and works with towns and cities across the world, helping to support successful local economies. Monaghan said the goal of the company is to help downtowns in the UK and North America with economic development in attracting spend to the local businesses.
It developed the UK’s first city-wide gift card program in Perth, Scotland, through its Town and City Gift Cards initiative in 2015. This program is designed to lock in money locally for participating businesses, drive foot traffic and stimulate economic activity, in effect creating a local currency through the Visa network. In 2018, Miconex launched Mi Rewards, a loyalty program that automatically rewards consumers for spending money at registered businesses in a specific local economy, encouraging consumers to spend more in their town or city.
“The idea behind the gift card program is giving local organizations such as BIA’s, downtowns, Chambers, local authorities, local government, a way to attract and keep spend in the downtown or the local area as opposed to letting it disappear off to bigger organizations, national chains, things like that,” said Monaghan. “A key component of the program is what’s called closed loop in that the organization that is in charge gets to control where the card can be redeemed.”
For example, Canada’s Food Island Gift Card was introduced by the government of Prince Edward Island in September 2020 to stimulate the economy and lock in spend on Prince Edward Island. The initiative was supported by the P.E.I government, with gift cards sold at a 20 per cent discount. Over $3.7 million has now been loaded onto Canada’s Food Island Gift Cards.
The province recently announced a new staycation incentive, with a $100 gift card given with each consecutive two-night stay at participating P.E.I accommodation, as part of a $66 million support package for the island’s tourism industry.
The Downtown Peterborough program began in December of last year.
“I think any organization that has that local focus where they have in some way a desire to help their local area . . . this is a great tool for them to keep that spend local to help the downtowns, to help the local areas, right now. Essentially, without being overly dramatic, many of these local areas are under threat right now. They’re really struggling. Large national chains and large international retailers, online or brick and mortar, have done actually reasonably well in the last year, year and a half, judging by the results, these smaller locations, these smaller businesses have really suffered,” said Monaghan.
Left: Kent Thompson, Director of Finance and Food Tourism at Food Island Partnership. Right: Mitch Cobb, Chair, Food Island Partnership
“So for those who are looking to really make a difference with the local businesses, the small businesses, this is a natural fit and what we’re seeing right now given the time of year leading up to Christmas we have organizations pretty much approaching us every day of every week right now seeing if there’s a way for this program to work for them.”
Kent Thompson
Kent Thompson, Director of Finance and Food Tourism for Food Island Partnership said the Canada’s Food Island Gift Card project has vastly exceeded their expectations.
“We have 160,000 residents on Prince Edward Island as Canada’s smallest province and had projected that the entire project would raise $100,000 for our local economy. Our initial release of 5,000 gift cards sold out in 4.5 days, so we quickly surpassed that goal. 80 merchants had signed up to receive the Canada’s Food Island Gift Card as payment within a week of the project being announced. We now have over 300 merchants.”
In September, Miconex said Downtown London will replace its Downtown Dollars program with a gift card. The new gift cards can be loaded with any dollar amount and spent in person at around 60 participating businesses including restaurants, grab and go eateries, entertainment venues, live music, sporting facilities and retail stores, or online on Downtown London’s Online Marketplace.
Kyle Marcus
Kyle Marcus, the managing director at Downtown Sudbury BIA and owner of cocktail bar The Alibi Room said it’s vital for communities to unite following the pandemic.
“Sudbury has been on a journey of change for some time, from small mining town to urban multicultural city. The pandemic has further changed our community offering new opportunities for growth as we’re experiencing an influx of people wanting to relocate to Sudbury for its mix of urban centre and outdoor recreation. As a small business owner, I can say from first-hand experience how hard it has been for businesses. Community unity is vital for Sudbury’s recovery, the Downtown Dollars Gift Card allows us to support merchants by giving them another revenue stream, and capitalize on the emigration from nearby cities. We’re positioning Sudbury for the future,” he said.
Shoppers Drug Mart at 728 Yonge Street (corner of Charles Street) on Friday, August 13 2021. Photo: Craig Patterson
Toronto-based Shoppers Drug Mart is expanding its base of managed in-store medical clinics after launching four locations in the Toronto area. The retailer says that it will expand the clinics across Ontario this year and the initiative is likely to expand into other provinces if the clinics are successful.
The Health Clinic by Shoppers™ is described as being a primary-care and family practice clinic that provides patients with convenient, one-stop access to medical services and advice. So far four locations are open with three of those in Toronto and one nearby in Whitby — that includes a downtown Toronto location on the third floor of the Shoppers Drug Mart store at the southwest corner of Yonge and Charles Streets as well as Shoppers Drug Mart stores at 770 Lawrence Avenue West near the Yorkdale Shopping Centre, 1995 Weston Road in Weston and Kendalwood Park Plaza in Whitby.
Jeff Leger
Three more locations are confirmed in Ontario with two being in Ottawa and another in Kingston.
“We know Canadians want and need more from their primary care. The world changed quickly and dramatically over the last year, highlighting the need for more accessible healthcare options for patients – including extended hours and more convenient locations for in-person services, and virtual care services for all patients including those who don’t currently have a family physician,” said Jeff Leger, President, Shoppers Drug Mart. “Since May 2020, our Toronto locations have been meeting those needs, through more than 20,000 patient visits. Bringing the Health Clinic to new markets will allow us to make healthcare more accessible for more Ontarians.”
The Health Clinic at 3 Charles Street West in Toronto on Friday, August 13 2021. Photo: Craig Patterson
The clinics host a suite of family medicine services with an aim to make healthcare more accessible for patients with extended operating hours and increased technology such as online appointment booking and virtual care options through Medeo® solutions and electronic health records via the AccuroEMR® platform.
With case counts rising across the country and with the more transmissible and deadlier Delta variant, retailers can no longer dodge the issue of vaccination standards.
In July 2021, Best Retail Careers International Inc. in partnership with Retail Insider conducted a survey with hundreds of responses about how retail employees feel about return to work and vaccines. The findings were very interesting.
Retail is eager to open fully. Retail workers are eager to get back to work except 68% of them are worried about returning to work with unvaccinated co-workers and customers. It’s such a big issue many are delaying making themselves available for rehire and retailers are in a near panic to find staff. It really isn’t the availability of CERB type funding and a laziness to work. The core issue is fear. The longer this pandemic goes on, the more resistant people are to accept front-line jobs.
HOW DO EMPLOYERS COPE WITH THIS NEW REALITY?
The law says employers have to provide a safe environment in every way, but it has stopped short of demanding vaccination proof. As more and more jurisdictions globally are implementing mandatory proof of vaccination for public facing jobs, Canada is stuck in limbo with a fear of igniting political strife over the issue. We have New York City jumping right in: no vaccination = no entry to restaurants, clubs, theatres, or any other public arena.
We have Alberta tossing open the doors with its ‘let’s see what happens’ policies. We have British Columbia only slightly more restricted while we have Quebec leading the charge with vaccination passports. What’s missing is leadership at the Federal and Provincial level that is consistent across the country about vaccination status.
HOW DOES THIS TRANSLATE OVERALL?
Nearly every poll from every source indicates that the Canadian public wants protection from COVID-19. They want to know they are safe inside stores. They want vaccinated staff. The public wants it even more than the workers want it. The weak job gain in July of only 94,000 positions isn’t no jobs. It is people refusing to return to work.
Retail cannot avoid the policy issue any longer. The law will say you can’t force people to get vaccinated. Fine. However, what are the rules on terminating people who are unvaccinated? It’s a tough call. The obvious solution is to implement a policy of 100% vaccinated for all new hires and give existing staff a window to comply as well.
Could a business get sued? Possibly. Is it likely? Not really. COVID is changing so rapidly by the time a wrongful termination case gets to court, we may well have mandatory vaccination rules in place.
Theprimary issue retailers have to face is creating a clear and sensible COVID workplace policy. Get creative — give rewards for vaccination. Continue the mask mandate with or without government approval. Talk to your employees or potential ones, and ask the same survey questions we did—and implement policy that speaks to their concerns.
At stake is the restoration of retail sales as we knew them. The longer staff stay away, the worse those numbers will be. Retailers must not sit back and wait for governments to create their policies.If there was ever a time for retail to take a leadership position, it is now. Find your best solution and make it public. Attracting new staff will be easier if they know your policy and how you intend to keep people safe in your stores.
For more information on our survey or how we can help with retail staffing requirements, please contact Suzanne Sears at suzanne@brcareers.com.
*Partner content. To work with Retail Insider, email: craig@retail-insider.com
The overriding theme of the 21st Century is accelerated change. Yet one industry remains curiously mired in archaic beliefs and practices, dating back decades. Advertising.
That’s the philosophy of one of North America’s leading marketing engagement agencies – Cult which is based in Calgary.
“Companies are still stubbornly hunting target audiences, unaware they should be making targets of themselves. They continue wasting obscene amounts of money on media campaigns and markdowns, oblivious to the fact that the biggest return on investment is to be had by making their products, programs and people more remarkable. They shout ever more loudly into a jaded void, rather than interacting with those who really matter,” says the company on its website.
“At Cult, we know that true customer engagement isn’t about getting people to buy — it’s about getting them to buy in. We understand that when customers get involved, contributing their voice, and not just their dollars, they are worth their weight in gold. We know that cult brands spend as much effort fostering their culture and engaging employees, as they do attracting customers. And we believe that, in a world with too many choices and too little time, companies without highly engaged, devoted followers, both inside and out, are destined to drift into irrelevance.”
Image: Cult Collective LP Facebook
Some brands have been successful over the years in building a cult following. Brands like Coca Cola, Harley-Davidson. Chris Kneeland, CEO and Partner of Cult, adds retailers like Home Depot, Lush, lululemon, Zappos.
Chris Kneeland
“Cult is just a provocative label for a business that’s reaping above average benefits from word of mouth – what we like to say advocacy. The majority of businesses are chasing awareness which is why they spend so much money on advertising. They think that if people just know us more the likelihood of them shopping us goes up,” said Kneeland.
“Cult brands certainly want awareness but they’re realizing the best way to become aware of a business isn’t through an ad but through a referral – somebody talking and championing on their behalf. That’s why we like the metaphor of cults. Cults much like religion or fraternities, they grow more by word of mouth. That’s the single biggest symptom. There’s a bunch of other little things about the engagement of their employees, about how they spend money, about how they don’t have to bribe people with discounts as often.
“So cult brands tend to be either a premium price point, a few notable exceptions like Costco and Target, but most cult brands from Porsche to Apple to Starbucks are kind of in the premiumness of their category.”
Kneeland said becoming a cult brand is not the hard part – it’s not like it’s a secret – but the biggest challenge is the idea that good is the enemy of great. Most businesses are content getting customers. Most bosses get promoted when they grow their revenue.
“Chasing some I think inferior metrics that prevent people from transcending from good to great,” said Kneeland.
Image: Cult Collective LP
“The single biggest thing is what do you truly desire. Are you just trying to be successful or are you trying to be significant? Most businesses are pretty content just being successful.” But he says there is a degree of prosperity that can be much more fulfilling.
“Businesses should exist for more than just the creation of profit. I think businesses should exist for the prosperity of mankind and cult brands are so adored not only because their purpose is greater but because they’re the exception.”
Kneeland said it becomes more difficult to become a cult brand the more stakeholders are involved. The higher the frequency of use by customers the higher the potential for a brand to have a cult following.
According to Cult, here are eight points to become a cult brand – some common traits that enable brands to better connect with customers:
Be Remarkable
“Too many businesses have commoditized offerings and must shout (i.e. paid media) or bribe (i.e. discounts) in order to be noticed. But cult brands create products, services and/or customer experiences that are actually worthy of people’s attention. They are more substance than sizzle and do at least one thing so exceptionally well that their fans can’t help but talk about it.”
Have Purpose
“Every business exists to generate profit, but cult brands also live by a noble brand purpose. Audiences often care more about what a brand stands for than what it sells, so cult brands have mastered how they weave their desirable ethos into their audience engagement strategies.”
Build from the Inside Out
“Cult brand leaders understand that no company can become beloved externally if it’s not first beloved internally. They prioritize culture and redeploy marketing resources away from advertising and margin-eroding sales promotions into a host of properly executed internal engagement pursuits.”
Co-Create
“Mediocre brands emphasize transactional relationships via creative messaging and media plans, whereas cult brands have learned how to shut up and listen. Cult brand leaders systematize how they solicit customer input and gain actionable insights, as well as how they encourage customers to amplify word of mouth.”
Congregate
“Cult brand leaders find creative ways for their fans to assemble together, virtually or physically. Whether it’s supporting third party-initiated activations or developing desirable destinations for followers to partake in elevated branded experiences, they make it easy for followers to gather and revel in their togetherness.”
Create Rites & Rituals
“Cult followers want to feel like insiders, knowing things and enjoying access that others don’t. Cult brand leaders spend less time creating marketing communications and more time creating lexicons, traditions, symbols and privileges that help best customers feel like valued members of an exclusive club.”
Be Relatable
“Cult followers treat specific businesses like close friends and seek out brand personalities and value systems that align with their own personal preferences. Cult brands perfect how they personify human attributes, and consistently bring their relatable persona to life across all aspects of the customer journey.”
Pick a Fight
“Cult brand leaders target the alienated and intentionally appeal to those who want to separate themselves from the mainstream. A large number of cult brands provocatively challenge market leaders and attempt to derail the establishment that is more comfortable playing it safe by trying to please everyone.”
Last week we reported that the Hudson’s Bay Company is separating its physical store and online businesses. It’s now officially online as the retailer’s website now shows ‘The Bay’ as being the official name of the site utilizing the same font as what’s seen on most updated Hudson’s Bay department stores in Canada.
The Bay website features a simple and upscale look that might confuse those not familiar with the retailer into thinking that it’s something of a luxury store. A section at the top of the website marked ‘Designers’ showcases some of the world’s biggest luxury brands such as Balmain, Oscar de la Renta, Thom Browne, Moschino and others.
Those designer brands are only available at The Room at Hudson’s Bay in Toronto (Queen Street) and Vancouver (Downtown) while some suburban stores are in another world in terms of having limited designer offerings in non-luxurious settings.
We’ll be providing updates regularly on the Hudson’s Bay Company and what it is doing with its Canadian stores as the retailer continues to transition its business model.
Cartier in The Colonnade - Image by Craig Patterson
French luxury conglomerate Richemont is investing heavily in the Canadian market with three significant store announcements. Two involve renovations/expansions and one involves an entirely new location.
At The Colonnade at 131 Bloor Street West in Toronto, Cartier is completely rebuilding its 4,300 square foot storefront which will reopen to the public in November of this year. The store will feature the brand’s most updated design and will be a showpiece for the prestigious street. Top clients have been privately invited to a suite at the nearby Hazelton Hotel in the meantime as construction to the Bloor Street flagship is ongoing.
At Toronto’s Yorkdale Shopping Centre, Cartier will temporarily shut its 3,500 square foot store for a complete overhaul next year that will include a new look as well as an expansion. UK-based luxury brand Mulberry, which shut its two Toronto stores last year, had a 2,250 square foot storefront next to Cartier — half of the Mulberry space has been leased to Cartier which will unveil the expanded location in 2022. Italian luxury jeweller Bulgari, located on the other side of the former Mulberry space, will also expand its 1,930 square foot store by annexing the other half of the Mulberry space for its own store expansion.
Cartier and the Former MULBERRY location at Yorkdale (Photo by Dustin Fuhs)
In Vancouver, Cartier confirmed with Retail Insider that the retailer will be opening a new storefront at 755 Burrard Street with frontage onto Alberni Street. Richemont bought the 3,200 square foot commercial strata several years ago and construction on the new Cartier store is expected to begin soon with a store opening expected for 2022. The opening of the corporate store will coincide with the shuttering of the licensed Cartier boutique at 456 Howe Street in the city’s ‘Heritage District’ which has lost most of its luxury stores following a shift to the Alberni Street ‘Luxury Zone’ where Cartier will be relocating.
Richemont’s investments in Canada signal confidence in this market as well as confidence in the future of brick-and-mortar retail following challenging times during the pandemic.
IKEA Construction - The Aura at College Park . Photo: Dustin Fuhs
Swedish home furnishing retailer IKEA has begun construction on its future urban format location in The Aura at College Park in Toronto. It will become the first location of its kind in Canada for the retailer occupying a smaller footprint than other stores over multiple levels.
According to the new Ikea.ca/torontodowntown webpage, the store is projected to open in early 2022. With the format being designed to cater to downtown Toronto’s 300,000 residents, the retailer has decided on a more seamless experience.
The 66,175 square-foot location will feature more than 2,000 IKEA products for purchase and immediate takeaway, while larger items will be on display and available for home delivery.
According to IKEA, the store will offer a “unique new food concept”, while also providing other services to “support a seamless shopping experience”.
IKEA Construction – The Aura at College Park . Photo: Dustin FuhsImage: IKEA
The website also shares a link to a jobs portal, which as of publishing has not listed any roles in the new store.
“The acquisition of the Aura Retail Podium marks our entry into the Canadian market,” said Cindy Andersen, Ingka Centres Managing Director. “Downtown Toronto is a super connected and dynamic place where people live, work, study and come to meet and have fun. It is in line with our strategic vision to invest in urban locations and to be closer to our customers”.
IKEA has continued to open smaller format stores in major markets globally, with Toronto being the next to showcase the format.
Additional Images from The Aura (Photos: Dustin Fuhs)
The Aura at College Park. Photo: Dustin FuhsIKEA Construction – The Aura at College Park . Photo: Dustin FuhsIKEA Construction Exterior of Aura Retail Podium. Photo: Dustin FuhsIKEA Construction – The Aura at College Park . Photo: Dustin FuhsIKEA Construction – The Aura at College Park . Photo: Dustin FuhsIKEA Construction – The Aura at College Park . Photo: Dustin Fuhs
