Department stores fight back

The department store is dead, long live the department store. That’s the message as US department stores “posted growth in the retail market share for the first time in nearly three decades.”

But messages can be simple and misleading. Department stores as most of us know them aren’t staging a comeback, in fact it’s the department stores who have adopted a ‘new retail’ mantra that are surviving and thriving. And that’s a no brainer, after all department stores only emerged out of their original innovation: everything under one roof. That model is broken, and this is the model that’s now working:

[The department store bounce back] might have something to do with innovative digital strategies, according to Scott Galloway, New York University marketing professor and co-founder of NYU think tank Luxury Lab, which released its second annual Digital IQ Index ranking specialty retailers according to their online competence.

Macy’s took the number-one spot in the survey, which used a 350-point data system to rate retailers in digital competency, spanning categories such as social-media strategy, site interface, mobile-commerce capabilities, digital marketing, search engine optimization and more.

Rounding out the top 10 were Victoria’s Secret, Nordstrom, Sephora, Urban Outfitters,, Bluefly, Bloomingdale’s, Gilt Groupe, Net-a-Porter and Pottery Barn. Neiman Marcus and Saks Inc. also scored well, and Bergdorf Goodman ranked 22nd.

While this might have been the year of the department store and mobile commerce, Galloway believes that Facebook commerce — or F-commerce — will be the next big thing in digital…

“Almost 100 percent of brands cite Facebook as a source of upstream traffic,” he said, citing Burberry as an example of the medium’s impact. “[Burberry] is getting more traffic from Facebook than Google. It’s the largest source of traffic to its site.”

Via WWD.

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