Celebrities help give retailersan edge with young shoppers
Sixteen-year-old Gabriel Aguilar, of Chicago, an avid shopper, prefers to patronize specialty shops such as Urban Outfitters or Forever 21 for party and hang-out-with-friends apparel.
Sears? Not a chance.
“Every time I think of Sears, I think of a washing machine,” he said. “They barely have clothing in their commercials, and I never see their commercials on the things that we watch.”
But when the high school sophomore learned that Sears soon would be offering skinny jeans branded with pop star Adam Levine's name, his interest was piqued — enough that he said he'll be checking out the goods.
Sears and a number of other department stores are hoping they can convince Aguilar and other young shoppers that they're worthy of a second look — and, ideally, their lifelong loyalty. They're beefing up mobile shopping tools and bringing in more affordable, fashionable merchandise as well as signing up celebrities to sell their wares.
The goal: winning over a coveted generation of those born after 1980 who spend about $430 billion annually on discretionary items, according to The Boston Consulting Group.
“Right now, all retailers are going after the millennial customer. They have to, because it represents the future of their business,” said Carol Spieckerman, president and CEO of Newmarketbuilders, a retail consultancy.
Late last year, Macy's rolled out more than 20 brands, including lines inspired by Madonna and her teenage daughter, Lourdes Leon, known as Lola, and Marilyn Monroe aimed at the younger set, which the company acknowledged cares about “trends, style and value.”
In February, Nordstrom revamped its trend-driven Savvy women's department, bringing in new merchandise and lowering the average price point to $50 from about $100.
“We thought we had the opportunity to be more relevant to that truly trend-driven customer who wanted us to be more accessible in price, and that was a hurdle for us before in that department,” said Nordstrom spokesman Colin Johnson.
This month, Sears launched a business unit dedicated to signing up celebrities to sell their wares, including trendy dresses and jeans. First on its list: pop stars Nicki Minaj and Levine, who moonlight on the popular TV shows “American Idol” and “The Voice,” respectively.
Retail experts say department stores have a way to go. They have never “owned” the millennial customer, who has typically been the primary focus of specialty shops such as H&M and Old Navy with their cheap-chic merchandise. A recent report by WSL Strategic Retail, a New York-based consultancy, found that 79 percent of millennials shop at specialty stores and 52 percent shop at department stores.
Celebrity branding isn't new. Designers have long competed to win the affections of Hollywood stars. But the embrace of social media among millennials has opened up new opportunities for retailers to capitalize on celebrities' star wattage.
Hoffman Estates, Ill.-based Sears, which has been suffering from sluggish sales for years, has had success recently selling apparel with celebrity headliners such as actress Sofia Vergara and the Kardashian sisters reality TV trio. With Minaj and Levine, officials are seeking to capitalize on the mix of music, fashion and Hollywood.
“Any retailer that taps into that celebrity taps into their transmedia presence — online, radio, TV, movies, Twitter, everywhere,” Spieckerman said.
Still, Spieckerman and other industry watchers are predicting it will be an uphill climb for Sears, which is better known for its home appliances than its fashion offerings.
Sears' customer is not a fashion customer, according to Roseanne Morrison, fashion director of New York-based retail consultancy Tobe.
“They are trying to envision themselves in different milieus to make it happen. So I don't know. It'll be a big challenge for them,” she said. “The jury is out.”
Retailers also have to do more to keep millennials coming back, said Wendy Liebmann, CEO of WSL Strategic Retail. The clothing and the in-store “experience” have to be right, she added.
“There are just too many places for younger consumers to shop,” Liebmann said.
Macy's has created entire divisions devoted to young shoppers: Its Mstylelab is dedicated to customers ages 13 to 22, and Impulse is aimed at 19- to 30-year-olds.
It has created private (Macy's-only) labels such as urban-inspired denim line G Star Raw and the skateboarder-driven Comune to draw in millennials with varied interests. And it also has the likes of Taylor Swift, P. Diddy and Justin Bieber selling its merchandise.