Hudson's Bay Company's 4-Step Plan to Create Radical Change to CX

In a keynote presentation yesterday at Shoptalk in Las Vegas, Helena Foulkes, CEO, Hudson's Bay Company (HBC), parent of Hudson's Bay, Lord & Taylor, and Saks Fifth Avenue, discussed how the retail organization planned to evolve from within to create radical change to the customer experience (CX) for all of its brands. Foulkes outlined four steps HBC will be taking to accomplish this goal: get personal; fail fast and fail cheap; marry art and science; and prioritize the game changers. Foulkes cited examples of these in practice during her presentation.

Speeding Up Checkout

Hudson’s Bay — the largest department store chain in Canada — has engendered feelings of passion, love and pride from Canadian customers, according to Foulkes. However, that didn't mean the retail brand was immune to the challenges facing traditional brick-and-mortar retailers, particularly department store chains. Foulkes was tasked with thinking of ways to drive the business forward, but didn’t have a customer feedback tool to know what Hudson's Bay's customers wanted. The retailer decided to implement Net Promoter Score (NPS), and quickly learned a primary pain point for Hudson's Bay customers: speed of checkout. What Hudson's Bay learned was that its checkout lines were being filled with not only customers that wanted to buy product, but also customers who were returning products purchased online.

To address the issue, Hudson's Bay created an in-store digital returns center. This designated in-store space, which was tested in 10 stores, took customers returning online purchases out of the in-store checkout line, speeding it up for customers making in-store purchases.

"Ninety-seven percent of our returns go back to our stores," Foulkes said, noting the severity of the problem.

The results of the in-store digital returns center test were very promising. Hudson's Bay saw its NPS increase by four points. As a result, the company is adding the spaces to all of its retail locations

"The team moved really fast to attack something that mattered to our customers," noted Foulkes.  

Rethinking the Department Store Space

What are our customers looking for? That was the question Foulkes and her team asked themselves about the company's Saks Fifth Avenue brand, and in particular its in-store customer experience. Their answer: theater, excitement, and customer service. To give its customers what they wanted, HBC is in the final stages of a $250 million grand renovation of its Saks Fifth Avenue flagship store in New York City. Some features of the new store design include:

• A first floor dedicated to women's accessories, including triple the luxury handbag offering — 50 brands, 100 products exclusive to Saks Fifth Avenue.
• An escalator was added in the middle of the first floor to help ease traffic and flow, which leads to a new second floor beauty department. On that floor, the design has opened up the windows to get natural light into the space. The store also introduced a beauty concierge, an example of how Saks is rethinking retail with a focus on services in-store, said Foulkes.
• Speaking on in-store services, the renovated flagship features L'Avenue, a new high-end restaurant. In fact, it's the only outpost of the Paris restaurant. "It's a game changer in the New York City restaurant scene," Foulkes said. "Chic, cool, and great food, which is attracting new customers, while delighting existing customers."

Digital Innovation

Saks Fifth Avenue is leveraging its 4,500 style advisors — the brand's competitive advantage, according to Foulkes — to personalize the customer experience. For example, it's provided them with clientelling tools that enable a personalized in-store experience. Customers can request appointments with style advisors through its digital platforms, as well as live chat with style advisors. Conversely, style advisors can offer their top picks, curate wardrobe outfits via their personalized web pages. "This is a massive integration that connects our store ecosystem with our digital platforms," said Foulkes.

In addition, Saks has begun to leverage its style advisors as social influencers on their personal Instagram pages. Foulkes noted that the advisors can sell product through the platform, and are incentivized to do so. This social influencer strategy has helped to position Saks Fifth Avenue as a fashion authority, Foulkes said. In fact, when hiring style advisors, the brand now inquires about their personal social pages.