If you felt Saks Fifth Avenue turned it’s back on you these past few years, they did. They are now admitting that their strategy to woo 25 to 34-year-old women over, flopped. Why was Saks offering expensive sportswear like premium denim under the brand
"7 for all mankind" and a "wild about cashmere" promotion in the
Manhattan flagship department store replete with goat mannequins?
Under Stephen Sadove, named chief executive officer 14 months ago,
Saks is now trying to lure back its onetime core customers: well-to-do
women 35 to 55.
Well, if Wall Street is any indicator, they could just pull it off. Neimans and Bergdorfs…beware. Morgan Stanley, Goldman Sachs Group Inc. and Fidelity Investments
are some of Saks’ biggest investors, with 21 million shares purchased
among them in the fourth quarter. Morgan Stanley quadrupled its Saks Inc. holdings to 8.8%.
As Saks prepares to report a fourth-quarter profit today after a
year-ago loss, according to analysts, Wall Street firms are wagering
that Mr. Sadove’s strategy will succeed and perhaps attract a buyer.
Under Mr. Sadove’s predecessors, Saks became more popular with
younger shoppers. But, they spend less, and Saks’ performance suffered,
said Fred Crawford, managing partner of turnaround adviser AlixPartners
LLC in New York.
While sales slumped, competitors such as Neiman Marcus and Nordstrom
Inc. benefited more from a four-year boom in U.S. luxury-goods sales.
Saks became a little too trendy for those who prefer luxury items and have deep pockets. This new strategy seems more like the Saks we used to know.See the Top Ten Summer 2016 Trends for Women Over 40