Value Proposition

The Saks Fifth Avenue retail value proposition is to offer both variety and depth in selection of apparel from high-end designers around the world to customers in the United States. Depending on the store location and size, the assortment of their inventory varies. However, Saks is viewed as a luxury department store retailer. As a department store, Saks strives to deliver a high standard of personal service to its customers and work to build lasting relationships with them. The internationally sourced products help maintain exclusivity for the store as well as distinguishes its regular clientele from the average consumer. It is the exclusive access to these brands that preserves their status in the luxury brand category and in the mind of the consumer.

Supply Chain Management

Saks has over 350 stores and six distribution centers (DCs). Unfortunately there is limited public information on the specifics of their supply chain. At Saks the merchandise is delivered in cartons. 95% of these cartons flow through one of their sort facility to shipping without being put away. Although this percent could be higher, Saks has decided to retain a small amount of inventory at its central DC center in order to quickly replenish fast selling items rather than managing cross-store shipments. Saks largest distribution center is in Steele, Alabama and is 180,000 square feet. This facility processes over 45,000 cartons per shift.

As far as customer supply, Saks has a system called "Locator".  With this system if a customer wants to purchase an item but don't see the color or size they are seeking, they can place a order with a customer service specialist online. When the order is placed a message is sent Saks stores nationwide that show the product being in stock. Once the order is filled the locator is then closed and removed from the alert system. Locator acts as Saks.com's "secondary" distribution center. The only disadvantage of locator is there is a chance that the item will never be filled. This may be caused by items that are damaged, store displays, sold before the locator alert is received, or simply cannot be found. In some says this is a risky move as it can potentially lower their service level. The locator alert remain open for 72 hours or until it is picked up.

When a customer places a locator order, they receive an automated e-mail identical to the one below.


We are pleased to offer you our Saks Fifth Avenue locator service and thank you for taking advantage of this very personalized service. This e-mail is being sent as a confirmation that we have placed your recent locator order.
Your Locator order has been forwarded to stores that show available inventory.  We want you to know that every effort will be made to meet our shared expectations by shipping you this merchandise. It is possible, however, that we may not be able to fulfill your order. On occasion, merchandise that is ordered through our Locator system can become unavailable for shipment due to an unforeseen reason. If this happens, we  sincerely apologize for disappointing you, and we will notify you that your order can not be completed via e-mail within 7 days.
Please take a moment to review the information below to ensure that all billing and shipping information is correct and that the merchandise ordered, on your behalf, is also correct.
 

Order # 1788753237 Details

Store:	001 New York
Date:	07 Jul 2012 12:03 PM
Associate:	John Smith
Phone #:	212-753-4000

Order: 1788757
Assoc: 123456  John Smith
John_Smith@s5a.com
Phone #: 212-753-4000

CHANEL SHOES
3572627055635      780/034
(1 @ 390.00)                    390.00

INTL OTHER
487818390866      
(1 @ 50.00)                      50.00

          Subtotal              440.00
          Total Tax               0.00
          Total                 440.00

MCD /XXXX-XXXX-XXXX-1234        440.00

Items Ordered: 1

Client Information

 

Mary Lee

MCD Charge XXXX-XXXX-XXXX-1234

Ship To:

Mary Lee
123 East Street

New York, New York

USA

If you wish to change or cancel your order, or if you have any questions, please contact me at 212-753-4000.
Once your merchandise has shipped, you will receive an e-mail with tracking information.
Thank you for shopping with us at Saks Fifth Avenue.
Sincerely,
John Smith

“Demand chain management is a software system that generates orders based on historical and forecast sales,” said Molly Shaw, vice president of business and demand planning at Saks Fifth Avenue, New York. “It provides a profiling method account for seasonality."

SWOT Analysis

Addressability

Saks.com allows users to maintain an account that will store all of their past orders, orders in progress, and cancelled orders.

Any items that have been added to a customers "Saks Bag" will remain there for 30 days unless the item becomes out of stock or the user manually removes it.

Interactivity

The Fashion Edit is a section of the Saks homepage where customer can scroll and discover exclusive merchandise or new trends. It is very general and focuses on all categories of merchandise. It is updated on a weekly basis.

Memory

Saks.com tracks recently viewed items on the bottom of their homepage. The items below were ones that I had searched for a week ago. A week later it was immediately displayed on the homepages without logging into my user profile.

Control

Since Saks Fifth Avenue is such a large retailer with an abundance of product, It comes to no surprise that all of their everything is clearly categorized on the website for easy navigation.


Toolbar (Most commonly used to navigate website)

Products listings by designer

Categorizes under women's apparel with different methods of displaying merchandise. In this instance the shopper can choose to shop by designer, type of apparel (ex. Leggings), Lifestyle, or even price.

Accessibility

It is clear that Saks wants to keep their customers to be in touch with its privacy policy. They have made it easy for customers be informed as to how their information is being used and protected. Rather then a lengthy privacy policy commonly found on e-commerce websites, Saks has created a set of frequently asked questions to address concerns.

Digitalization

This year Saks has updated their website to reflect higher quality photos, runway shoes, and detailed product videos using Adobe Flash Player.

Shoppers also have the option of toggling the photo to see different angles all while staying in the same resolution.

 Click Here For To See The Adobe Flash Player In Action

Saks.com Vs. Saks Brick & Mortar

Positioning: Saks Vs. Luxury Dept. Stores

Blogger: Saks POV

Saks POV is an ongoing editorial project that features a host of contributors writing about fashion, travel, events and other lifestyle related topics. Denise Incandela, Chief Marketing Officer and President of Saks Direct states "Our objective was to give the story behind the products.  We can use this as an outlet to engage with our customer and a portal for the best of fashion editorial…We want to be the go-to destination for our customers."

Tumblr: 10022-Shoe

As an initiative to promote its already booming footwear department, Saks created a Tumblr account dedicated to its flagship shoe salon’s 10022 ZIP code. On the website users will see a "hot" shoe and underneath is a link to order the shoe on Saks.com.

Aesthetics

Saks Fifth Avenue's website promotes easy access shopping. When viewing the homepage of the store you wouldn't think that the website is mimicking the store aesthetics. Inside you will find bland images of what are "hot" items and very limited look books. The color schemes are very simple and rarely go beyond black and white. Overall, the website can be improved but this has proven to be a challenge with a retailer that carries such a large assortment.

Descriptive Writing

Saks.com uses very short descriptions that provides just enough information for a consumer to make a purchasing decision. Luckily, the clarity within the photos and videos of products make up for the lack of description. The biggest concern is that they do not specify the percentage of fiber content within a specific garment.

Plan of Action Process: Benchmarks

 To determine the metrics of success, Saks must closely monitor the following benchmarks:

1) Web Traffic: As the Saks website continues to expand it is imperative to find which areas of the website is creating the least and the most traffic. Web traffic will determine weather or not it is lucrative to maintain a specific sector of a website or if editing is needed.

2) Click Through Rates: As marketing begins to because more and more competitive, especially on the web, it is necessary that Saks see how much these advertising methods are effecting their business.

Globalization

At the moment, Saks Fifth Avenue is putting in place a diverse international retailing business that may ultimately include direct marketing in South America, a store in Mexico, and, with local partner Seibu, in-store shops in Japan. At the moment Saks.com ships to 101 countries and accepts 40 different currencies.

Innovative Ecommerce Systems: M-Commerce

Saks Fifth Avenue recently updated its mobile application that offers commerce, exclusive videos and a bar code scanner to find additional details on in-store items. IPhone and iPad users can create gift lists, locate a store, view the Saks gift guide and shop special offers. A customer can scan a bar code in store and get all the reviews from customers on the product as well as runway videos.

 

Below a customer can take a photo of a barcode or manually input it for details.

 

Using location services a customer can track which locations have the exact item they are seeking.

Marketing Campaign

Black Milk Clothing & Saks.com Collaboration

As designer collaborations become more and more popular they are no longer being seen just at fast fashion retailers. Most recently Saks competitor Neiman Marcus did a holiday collaboration collection with Target.

Black Milk Clothing has gained a lot of popularity in the last year because of their signature printed leggings (Retailing at $100). What makes them unique is that they are sold exclusively online and are produced then shipped from Australia. Black Milk owes much of its popularity from social platforms such as instagram and twitter.

For my collaboration Saks.com will premier 20 pairs of Black Milk leggings on their Saks.com website per day. They will be exclusive designs made specifically for Saks. Saks will then introduce one pair of leggings per day. This will keep the customer coming back to check each day what the new print is and create a sense of "scarcity".

Both Saks and Black Milk will use their already established Tumblr and Instagram interfaces to promote this event. Each day both retailers will captures photos of the day's leggings in action.

The collaboration will help promote Saks contemporary department, giving is more uniqueness.

References Used

ConsumerAffairs.com. (n.d). Reviews. In Consumer Complaints & Reviews. from: http://www.consumeraffairs.com/retail/saks.html.

Econsultant.com. (20 July 2009). Statistic Site. In Top 10 Competitors for Saks Inc. from: http://compete.econsultant.com/top-sks-competitors/.

Neiman Marcus Launches App. (2012, March 5). Retrieved from: http://www.gourmetretailer.com/top-story-neiman_marcus_launches_app-10432.html

Saks Fifth Avenue. (n.d.). Retail Site. In About Us. from http://www.saksfifthavenue.com/.

Susan Suffes. (08 January 2004). Blog. In How Saks Welcomes New Customers., from: http://gmj.gallup.com/content/10093/how-saks-welcomes-new-customers.aspx.