WRC day 2 wrap release by Zz4jbg

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									September 20, 2012

                  HIGHLIGHTS FROM DAY 2 AT 2012 WORLD RETAIL CONGRESS

      Sir Philip Green commented on the ever increasing competition in the retail sector
       advising retailers to provide new product every four weeks

      Millard Drexler, CEO of J Crew, noted that this Christmas will be ‘extraordinarily
       promotional’

      China, Russia and Brazil highlighted as the key drivers of growth in the luxury sector


Sir Phillip Green, owner of Arcadia Group and Millard Dexter, Chairman and CEO of J Crew
Group participated in a question and answer session admitting there are too many shops
chasing too few customers with the numbers of new customers not having increased since
the financial crisis.

Sir Phillip Green, whose empire includes TOPSHOP and TOPMAN, said: “It’s a competitive
market place with too many shops.”

Millard Drexler told delegates at London’ Excel: “In the last three years Amazon alone has
taken $30 billion out of an already flat worldwide market.”

“All I read about is more stores opening, a race for growth for growth’s sake. There’s a lot
more competition, but a lot less creativity and a lot more copying and more discounting.”

Sir Phillip acknowledged that in an ideal world a great retailer would have a small number of
fantastic flagship stores, a few smaller stores in key locations, and an online business.

He said that there was very little new development happening at the moment, but warned
that when a new centre, such as Westfield at Stratford opened, there was an inevitable
knock on for those smaller centres nearby.

They both agreed the challenge is to keep investing in the business, refreshing the customer
offering and give them a reason to shop in your store.

Sir Phillip said: “You’ve got to excite the customer and get them to come to you. If you’ve
got a great product people will buy it.”

Millard added: “If you have a strong franchise you will survive as a retailer.”

Asked about the outlook between now and the end the year, Drexler said “Christmas will be
extraordinarily promotional as it has been every year for the last 20 years.”

Sir Phillip said: “Consumers now know where they are, they know what has changed,
they’ve got their life planned and their purse managed accordingly. Retailers need to be
quicker, newer and fresher than ever with new product every four weeks. If you get that right
you’ll keep doing business.”

Earlier in the day, the conference heard that even the luxury end of the market wasn’t
immune to the downturn. In a panel debate considering whether the luxury market was a
‘bubble waiting to burst’ delegates heard that while luxury retailers will continue to open
stores those outlets are likely to become smaller, with niche sub-brands possibly operating
from capsule stores.

Bill McComb CEO of Fifth & Pacific said that in an omni-channel world stores remained vital
but that he was more likely to look for space between 2,300 sq ft to 2,400 sq ft than previous
floorplates of 4,500 sq ft.

He added: “The square footage binge is over, we are building our business around omni-
channel and that means smaller stores but those stores remain crucial to our offer.”

The panel cited consumers from Brazil, China and Russia as the drivers of global growth in
the luxury sector, while all acknowledged the increasing influence of mobile-based retail.
Brooks Brothers CEO Claudio del Vecchio said: “E-commerce is growing at an increasing
pace and mobile is influencing much of this. The priority for us is to integrate the channels
with our stores.”

The final day of the congress highlights will include debates on the future of shops and
shopping centres, the challenge of building a sustainable business, and whether the
‘Brazilian miracle’ can continue.


Editors notes:

About The World Retail Congress
The World Retail Congress was launched in 2007 to be a platform for senior retail
executives to meet and discuss the most important topics affecting retailers across the
world. It has been held in Barcelona (2007-9) and Berlin (2010-11) and is attended by up to
1,000 industry leaders from more than 60 countries. The programme is developed in
conjunction with the Congress Advisory Board which represents many of the world’s biggest
retailers such as Gap, Kingfisher, Macys, Reliance Lifestyle, Myer, Alshaya, Netto, Inditex
and Tesco.

The co-sponsors of the 2012 World Retail Congress are Deloitte and Mastercard.
More information at: www.worldretailcongress.com

For further information contact:

Ian McGarrigle, Chairman, World Retail Congress, +44 (0) 7713 505476
Lucy Frankland, Account Director, Pelham Bell Pottinger +44 (0) 7920 877184
lfrankland@pelhambellpottinger.co.uk

								
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