Hudson's Bay Separating Saks' E-Commerce Site Into Independent Business
The owner of Saks Fifth Avenue, Hudson's Bay Company, announced it will separate the Saks' website into an independent business from its stores, CNBC reported. The decision to split the luxury department store's website comes after it raised $500 million.
Venture capital firm Insight Partners put up the money to take a minority stake in Saks Fifth Avenue's e-commerce site, which is valued at $2 billion. This decision means that Saks' 40 brick-and-mortar stores will split from Saks.com and will be known as SFA. The SFA brick-and-mortar stores will remain entirely owned by HBC.
Marc Metrick, who was the chief executive of the combined Saks businesses, is set to become CEO of Saks.com, CNBC reported. Also, former Amazon.com exec Sebastian Gunningham will join the e-commerce site's board. For SFA, Saks veteran Larry Bruce will take on the role as president, ultimately reporting to Richard Baker, CEO of HBC.
Total Retail's Take: This is interesting news from HBC. With e-commerce booming during the pandemic, it makes sense that investors would shy away from putting their money into brick-and-mortar stores, opting in favor of digital outlets. HBC recognizes that dynamic, and is trying to capitalize on an inflated market for Saks' e-commerce business. This past year has shown that luxury retail has room to improve when it comes to the online shopping experience, but the good news is there's also an opportunity for growth. A potential drawback to HBC's decision to sell off Saks' e-commerce business is that it could result in a lack of brand consistency. Time will tell how this change will impact shoppers, if at all.
Ashley Chiaradio is the Senior Content Strategist at Total Retail. Ashley has been creating content for more than 7 years, and provides a unique insight in covering the retail industry having worked directly for retailers in the past. She’s passionate about profiling women leadership in the space.