LONDON — No longer for sale, beauty retailer Space NK is looking to grow internationally, with plans to open more units across the U.K. and in the U.S. and China under new chief executive officer Andy Lightfoot.
Lightfoot, who was promoted in April after serving as the retailer’s global digital director, laid out a bullish expansion plan for the next three years. It includes investment in e-commerce, enhancing the retail experience and becoming even more sustainable, with the aim of doubling the sales of the business.
According to Companies House, the official register of U.K. businesses, revenues were up 6.7 percent to 102.9 million pounds in the year to March 31, 2018, while profits spiked nearly 50 percent to 4.9 million pounds.
Although he’s in the top job, Lightfoot said he’s still very closely involved with the retailer’s digital teams and sees digital and physical as one in the same.
“Over the past month, we’ve changed the entire structure of our company, we have completely abolished this notion of digital e-commerce and stores and having separate teams for them. Now, we only have a single customer, commercial, marketing and operations team,” he said in an exclusive interview.
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The structural changes have worked: Lightfoot said Space NK is well ahead of its three-year plan.
“This year we are expecting solid growth, both in terms of like-for-like sales and store openings. We are bucking the trend on the high street. and will have more store openings in the next three years than we have had in any of the previous years,” he said.
Space NK plans to open eight stores a year over the next three years across the U.K. In the U.S., the retailer will open two more freestanding stores with plans to expand concessions in U.S. department stores. Space NK will also be looking to add stores in China in malls, concentrating on Shanghai and Beijing.
In May, the retailer opened a unit in Beverley, Yorkshire as part of its strategy to open stores in smaller towns and local communities. “There’s a huge demand for having a community retailer. These customers were originally traveling to London or making trips to the next town to test, play and buy product,” he said.
The small and wealthy market town of Beverley is proving quite a draw for British health and beauty brands, and is already home to Jo Malone London and Neal’s Yard Remedies.
Play and convenience are important elements of the Space NK stores and, to wit, the retailer’s London Tottenham Court Road store has a play table and self-service drawers.
“It’s a gondola execution that we designed, so the products sit on this pull out drawer and customers can grab what they want instead of waiting for a member of staff to get it for them,” he said, adding that a lot of customers are looking for fast service and convenience rather than gimmicks.
The stores also encourage cross-play, where customers are able to try products from different brands at the same time without having to migrate from counter to counter as in a traditional department store format.
Lightfoot said his focus is to give customers the experiences and efficiency they are craving, whether that’s by creating clear signage or through the Foundation Finder tool, which shade matches a customer’s existing foundation to one that he or she wants to buy.
The store also offers a 100 percent satisfaction guarantee.
“It’s probably one of our best kept secrets. We believe so much in the advice we give that if you’re not happy with a product after having opened it and used it, within 28 days you can come back and swap it for something else,” he said.
According to Lightfoot, sensible solutions, such as a satisfaction guarantee and a loyalty program, have fueled the retailer’s growth. He is also investing heavily in technology and said that by the end of August, Space NK will have a new mobile experience and will be “one of the first brands in the U.K. to do so.”
In the next three months, the retailer will also be swapping its existing packaging for a fully recyclable one and the longer-term goal is to introduce an eco-packaging option.
“Customers will have the choice at the checkout to choose this eco-option, where their product will be delivered with the least amount of packaging possible while keeping it intact and in one piece,” he said.
As reported last year, Space NK’s owners Manzanita Capital tapped Goldman Sachs to explore sale options for Space NK, although Manzanita never confirmed it was looking to sell the high-end retailer.
Space NK has confirmed that it is no longer for sale.
The retailer was founded by Nicky Kinnaird, who opened the company’s first store in London in 1993. Since then it has expanded to more than 60 locations in the U.K., and more than 25 in the U.S., which it entered in 2007.
Space NK has been backed by Manzanita Capital, the family office started by Gap Inc. veteran William Fisher, since 2003. In the U.S., Space NK has retailer partnerships with Nordstrom and Bloomingdale’s.
The retailer sells luxury and niche brands including By Terry, Goldfaden MD, Lancer, Malin + Goetz, Oribe, Tula, 111 Skin and 37 Actives.