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NEW ORLEANS — Saks Fifth Avenue plans to step up the “Want It!” marketing campaign to highlight key items and trends in local markets, Stephen I. Sadove, Saks Inc.’s chairman and chief executive officer, said Wednesday at the retailer’s annual stockholders’ meeting.
The campaign will concentrate advertising dollars on local media because it is “more important to give customers in each of the…markets a better idea of what’s available to them because each store has a different emphasis,” Sadove said during the meeting at Harrah’s Casino Hotel here.
The gathering, which drew a few handfuls of stockholders, was held here in recognition of the comeback of SFA’s local store, which was ravaged by Hurricane Katrina almost two years ago and didn’t reopen until last November.
Sadove said the unit had regained its ranking as one of the company’s highest-performing locations, with $50 million in annual sales. Sales average $500 per square foot and volume is heading toward its historic level of 5 percent to 7 percent annual sales growth.
The meeting came after the retailer said last month that it was gaining on competitors and cited strong first-quarter results. Although net profits fell 86 percent in the quarter ended May 5 because of major gains a year ago from department store sell-offs and severance costs as a result of downsizing, operating income grew to $32.6 million in the quarter from $12.2 million a year ago. Comparable-store sales rose a robust 14.4 percent and total sales jumped 15.9 percent, to $792.7 million from $684.1 million.
Sadove restated the goals of reaching 4 percent profit margin this year and boosting that to 8 percent in the next three years, which is still less than the double-digit margins of competitors Nordstrom and Neiman Marcus.
He said SFA was pushing ahead with its annual $125 million to $150 million capital spending plan, focusing on stores in Palm Beach and Naples, Fla.; Phoenix; Chicago; Boston, and San Francisco and Orange County in California. A recently completed renovation of the Beverly Hills store has resulted in major sales gains, particularly in handbags, which were up 70 percent, he said.
The company’s Web-based point-of-sale system, intended to provide faster and detailed data on customers and enhance communications with them, is expected to be expanded to 23 stores from 19 by yearend. There is a three-year rollout planned for all 54 SFA units. The company also operates 49 Off 5th units, saks.com and Club Libby Lu.
This story first appeared in the June 7, 2007 issue of WWD. Subscribe Today.