HBSRLGC – Boston, MA: Day 1

So I was in Boston for the annual Harvard Business School Retail and Luxury Goods Conference (HBSRLGC). Yes, I know that’s a long acronym. I’ll document my days in Boston (4/14/12 to 4/15/12) with pictures and tweets (yes – tweets).

A Sculpture at Back Bay Station - by George Greennamyer, 1976

After coming out of the station I took this picture of the entrance to the Back Bay Station:

Right across the street from Back Bay Station is an iconic property – Copley Place. This was a good experience for me because just the day before I had the pleasure of conversing with Howard Elkus and Ken Himmel, famous architect and renowned developer respectively.

Copley Place consists of multiple connected buildings. Here is a picture of a pedestrian bridge over Stuart St.

NW Elevation of Copley Place

NW Entrance of Copley Place

Took the Orange Line from Back Bay to Downtown Crossing, transferred to the Red Line and went on to JFK/UMass where I stayed at the DT - Boston Bayside

Left the hotel and went to Harvard Square Station via the Red Line

Later in the evening around 6pm, I went on to the Sheraton Commander Hotel for a networking session and keynote address by Steven Kolb, CEO, The Council of Fashion Designers of America (CFDA). He set the conference off on a good tone discussing the role and history of the CFDA as well as its efforts to push intellectual property rights for designers in the US.



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Interesting Infographics – Global E-Retail

These infographics (below) from Internet Retailer are necessary for today’s entry because of my last post on Neiman Marcus.

Finally…. Luxury Car Brands are Taking Tips from the Kings of Customer Service

Key Takeaway from The Luxury Doctrine (a new resource in development):

If you want to be successful, especially in luxury, you have to think of, and act like the customer, at all steps in the value chain… you have to manage the customer’s experience

– Edmund Amoye, Lessons in Luxury

For those who have been following my posts on the different luxury segments, you’ll notice that the key catalyst for success in today’s environment is innovation in managing the customer experience. If you are new to this customer-centric theme, I have a list of related posts at the bottom, to get you up to speed.

In every business there are seasons and cycles – ups and downs. At their rollout to end-users, luxury goods and services are sometimes heralded as innovative novelties and “must haves”. However, as brands permeate, manufacturers innovate, and marketing teams penetrate (I had to use that rhyme… too easy to pass up), commoditization sets in. Luckily, the Ford Motor Co. is doing something about that with its Lincoln automotive brand.

– Top View of the 2013 Lincoln MKZ Continue reading

JCPenney’s New Retail Strategy Expected to Hurt Performance

Article Link – Penney’s Pricing Strategy takes a Toll on Sales

Ron Johnson’s bet on JCP’s new retail strategy will not come without its costs. Analysts on Wall Street are expecting JCP’s revenues to drop by “seven percent this fiscal year”. This is worse than the previously forecasted two percent drop because analysts believe “shoppers accustomed to seeing big discounts [will] go to rivals like Macy’s Inc.”. Same-store sales are expected to drop nine percent – lower than the four percent drop that was originally anticipated.

Penney’s new strategy is simple – three tiers:

  • “Everyday” prices that are 40% lower than what they were charging a year ago;
  • Month-long sales on select items; and
  • Clearance events during the first and third Friday of each month (to coincide with employee payroll distributions)

Though the street expects dire consequences for JCP’s stock in the short term, it also believes that Ron Johnson’s plan will pan out in the longer term by eliminating “unprofitable promotions and [improving] its profit margins overall”.

If successful, this will be a major change in retailing because suddenly the promotional activity will decrease and other retailers will also have to find ways to attract customers… but this is going to take time.

– Walter Loeb, New York-based retail consultant

JCP is expected to offer more details on its performance when it reports its quarterly earnings results in May.

My View: This is a long-term bet, not a strategy that will yield postive returns in the next six to 12 months. Ron Johnson is not trying to change his strategy – he is trying to change the rules of the retail game. His bet is riding on a revamp of the entire retail experience.

Disclaimer: I do not own, or plan to buy any JCP stock in the next 48 hours.

“Lessons in Luxury” is Global – Country Views

My blog has posts going as far back as April, 2011, but I only started publishing in August, 2011. I didn’t have a huge following when I started. Hey let’s be real, I was probably my only reader – aside from my family.

Today, the unique page views of the blog run in the thousands. Here’s a look at where my readers come from. If my blog was a luxury goods company, we’d be very diversified.

Views from the top 20 countries expressed as rounded percentages (as of 3/21/12)

Are Luxury Brands Recession Proof?

Credit for this post goes to Chase Harps, one of my MBA classmates.

I often find myself having to evangelize for the luxury industry, especially to people that may be skeptical of its necessity or long-term viability. For those people, I am posting a link to a new 2012 brand ranking report from Brand Finance. Based on its findings, the company issued a viewpoint on luxury brands. Entitled “Recession Fails to Dent Consumer Lust for Luxury Brands“, the article lists the following main points. Continue reading

A Gathering of Luxury

One of the substantial influences that prompted me to start Lessons in Luxury was an industry conference I attended in April, 2011. The event was the Retail & Luxury Goods Conference hosted by the student-run Retail & Luxury Goods Club at Harvard Business School (HBS). Meeting business luminaries such as Tommy Hilfiger, William Lauder, and Stephen Sadove did a lot to help me develop my career ambitions.

This year, you can join me and my cohorts in the Luxury and Retail Club from The College of William and Mary, in Boston, MA. HBS will host the 2012 iteration of its annual conference from April 14, 2012 to April 15, 2012. For more information on registration, keynote speakers, and logistics, go to http://www.hbsrlgconference.com.

Previous speakers at the conference have included:

  • Stephen Sadove – Chairman and CEO, Saks Incorporated
  • William Lauder – Executive Chairman, The Estee Lauder Companies
  • Tommy Hilfiger – Principal Designer and Visionary of the Tommy Hilfiger Brand
  • Bernd Beetz – CEO, Coty Inc.
  • Terry J. Lundgren – CEO, Macy’s Inc.
  • Patrizio di Marco – CEO, Gucci

I look forward to seeing you there.