Through Recession, Globalization, and Online shopping, the Retail Industry in Canada is Changing. But These Women Are Still On Top

There’s no getting comfortable in retail – things change too fast – but these women are still on top.

BY SARAH BARMAK

In the fast-paced world of fashion, retailers know one frustrating rule. Shoppers demand what’s new, what’s next and what’s hot-but they don’t always want it. Carrie Kirkman, President of Jones Group Canada and one of the top women in Canadian retail fashion, understands that all too well.

Known for its chic, reliable career staples, designer and multi-brand marketer Jones debuted a trendier collection in Spring 2013 that featured lots of prints and peasant blouses. “We went a little too boho, and a little too far from our brand’s comfort zone,” says Kirkman, who also says it was one of the company’s slowest seasons in years. “[Our customer] was looking for her great solid-colour jean to wear with her peasant top. She was not looking for print on print on print.” The brand did an about-face, going back to its sleek basics in the fall—and its clients came back.

Amid a finite pool of high-end consumers, the availability of online shopping and invasions of foreign one-brand mega-stores like H&M, staying relevant in the Canadian retail landscape isn’t easy. With the impending entry of luxury department stores Nordstrom and Saks, the coming years will see major shifts in the landscape of mid- to upscale retail in Canada. A makeover may be in order.

There are secrets to weathering change, says Bonnie Brooks, Vice-Chairman of the Hudson’s Bay Company (which owns Saks). She agrees with Kirkman that established brands often stumble when they try too hard to appear young or cutting-edge, losing touch with their actual demographic. “That’s happening, for example, in the teen business in the United States right now,” she says. “Companies like Abercrombie & Fitch and American Apparel and American Eagle and several of the mono-brands and even multi-brand retailers are having a tough time understanding that customer right at the moment.”

There have been celebrated retail reinventions in recent years, most notably the transformation of century-old retailer Target into a discount behemoth. Far more common, however, are the retail flame-outs and fastfades. Canada’s retail history is spotted with them, including Simpsons and Zellers.

“The thing with retail is, it never stays the same,” says Kirkman, who has helmed Jones Group Canada since 2010. (Jones Group Inc., of which Jones Group Canada is a subsidiary, itself agreed to be bought by private equity firm Sycamore Partners in December 2013.)

It’s true: sometimes a retailer needs a facelift, however, it can be easier to invent something new than to reinvent an existing brand, says Brooks. “But the exciting thing is that if you’re reinventing something on a large scale, and it really begins to turn around and gain some traction, then it gathers momentum and it can have a major positive gain much faster, and certainly much more profitably, than a startup or an invention.” She’s speaking from experience; Brooks has spearheaded more than one retailer’s reinvention.

The world’s oldest company, HBC, brought her on in 2008 to transform its department store after she led the reboot of sleepy Hong Kong retail chain Lane Crawford. There, she introduced labels like Chloé and Jimmy Choo and transformed its flagship store into a chic destination, complete with a martini lounge and art installations. Brooks oversaw the renovation of Hudson’s Bay’s flagship Queen Street location, introduced higher-end stores like Topshop, improved the company’s finances and debuted omnichannel availability (its strategy of integrating online, mobile and traditional shopping). As a marker of all this change, the old store name, The Bay, was retired last year in favour of Hudson’s Bay—its first big logo refresh since 1965.

The coming luxury glut
There has been little competition among Canadian department stores for a long time, but that’s about to shift. “That, I think, is going to be the biggest change that we’re facing,” says Kirkman, who says she wonders how Nordstrom, Saks, Hudson’s Bay and Holt Renfrew are going to avoid overcrowding the coveted, but small, upper tiers of the Canadian market. “If you look at people who earn greater than $200,000 in the U.S. versus Canada, I think there’s a 40-to-one ratio. Whereas just population wise, we’re not even 10-to-one now. So just the way we skew, the U.S. has a greater lower income and a greater higher income relative to its total population. Canada has a much larger middle.” And those aren’t the people chasing luxury labels. Brooks takes the long view of the effect of the newcomers.

“With more competition, the mediocre players and below mediocre will definitely fall away,” she says. “But it will improve the retail calibre overall in the country, and I think that’s the exciting part.”

The challenge of Canadian e-retail
“The next thing facing the Canadian marketplace is how to really figure out online shopping,” says Kirkman. “The reality is, you still have to pay the duty,” says Brooks. “If we are, as a company, landing a Lord & Taylor cashmere sweater in New York and we’re landing the exact same sweater from the same factory in Vancouver… the difference is the U.S. is charging 4% for that sweater to come in and Canada is charging 18%. So that’s why there’s a price difference in product!” The sticker shock leads Canadian shoppers to think twice about online buys—and worse, sends some south of the border to buy the same thing for less.

Self-reinvention
Both retail masters have had long, accomplished careers working for brands as diverse as Liz Claiborne, Ports, Alfred Sung and Holt Renfrew. Neither has had to reinvent their careers, but they have had to negotiate change. “Whenever one takes on new responsibility that’s outside their former scope and enlarges that scope, it can certainly be challenging,” says Brooks.

She recalls rising in the ranks in the marketing and store division of Holt Renfrew in the 1980s, which led to an unexpected promotion to an executive role. Although she had not been a buyer, she suddenly found herself in charge of the entire buying office, including all the vice-presidents of merchandise and the general merchandise managers. “And that was a big step, because I needed to earn the respect of that team, and that was a large team. And a few of them were more experienced and older than I was.”

Transitioning to her newest role, that of vice-chair, has been easier. “Having a chance not to be responsible for the day-to-day activity, and having a chance to stand back and take more of a bird’s-eye view of the business, is a luxury for me,” says Brooks.

In retail, smart brands don’t reboot simply to do something new. What they must always do, no matter how big and established they are, says Kirkman, is stay relevant to the customer’s desires. In advice that holds equally true for personal branding, she adds: “The second you sit back and go ‘Look at me, aren’t I great,’ is the beginning of your demise.”