Neiman Marcus carries a big luxury load but will lighten up with a new strategy for Cusp.

 

All of Neiman’s contemporary departments are being renamed Cusp and will be remade with a wider product range, updated fixturing and mannequins, intensifed color and a hipper, younger attitude.

 

“Our stores are very luxurious and they can be at times a little intimidating. So we want to create an area that is very high energy, feels less intimidating and is modern and fun,” Jim Gold, president of specialty retail for the Neiman Marcus Group, said in an exclusive interview. “It shows another side of Neiman Marcus.”

 

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According to Gold, “We have never branded the contemporary area before. We just simply called it contemporary. This is a very different approach. We are creating a subbrand of Neiman Marcus — an extremely large shop-in-shop if you will.”

 

Neiman’s launched Cusp in 2006 with two freestanding boutiques selling contemporary apparel, shoes, handbags and accessories. Since then, there’s been little growth in the concept, with just four additional stores opened and the launch of cusp.com. Cusp boutiques operate in Tyson’s, Va.; Century City, Calif.; Georgetown, D.C.; Water Tower Place, Chicago; Northbrook, Ill., and Chestnut Hill, Mass.

 

But now Neiman’s has green-lighted Cusp, to an extent. So far, six Neiman’s stores have converted their contemporary departments to Cusp; by mid-June, 20 stores will have Cusp, and by October or November, the remaining 22 Neiman Marcus stores will also have Cusp. The average Cusp department will be 8,000 square feet, which means that space will be increased on contemporary floors in some locations by as much as 20 to 25 percent.

 

“As each store gets converted to Cusp, we are layering in jewelry, accessories, and a small offering of shoes,” Gold said, citing Sam Edelman and Pour la Victoire in shoes, and Rebecca Minkoff, Be & D, Chris Kon and Love Moschino in handbags. In apparel, Alice + Olivia, Helmut Lang, DVF, Rag & Bone, A. L. C., Vince, Theory, Alexander Wang and Phillip Lim are among the key vendors.

 

When asked if more freestanding Cusp boutiques will open, Gold replied: “We don’t have any hard plans in place to do so.” Yet he gave the impression it’s possible down the road. He said Neiman’s is “very pleased” with the performance of the six Cusp boutiques operating, though for now, at least, the priority is to build Cusp inside the Neiman Marcus stores, and beef up Cusp online, taking an “omni-channel” approach. Once that’s all accomplished, “We will have a clearer picture of where we want to go with our freestanding stores,” Gold explained. “It sets the stage to expand our freestanding stores at some point in time.”

 

The contemporary market is the hottest sector in women’s apparel. Neiman’s does a substantial contemporary business but has some catching up to do.

 

The key challenge is to differentiate. “There is plenty of brand overlap, especially with Saks more so than with Bloomingdale’s,” Gold acknowledged. But he promised that “physically, Cusp will be very clearly differentiated” and will further stand out with “a best-of-class selling team” equipped with technology including iPhones that are rigged with CRM tools.

 

From a merchandising standpoint, “We are differentiating by introducing accessories, increasing the percentage of exclusive items within collections, and by how we edit the collections,” Gold said. “We tend to be more fashion forward. We tend to embrace color. Our clients are very active socially and want great clothes to wear to the hottest restaurants. On average, we are more expensive than Bloomingdale’s.”

 

He also said Neiman’s is putting greater emphasis on key items and “lifestyling.” For example, tops for date nights will be spotlighted in its own area as well as within collections, whereas as in the past, it was just the latter. He also Neiman’s is “retooling” its denim presentation, and creating “On the Go” areas featuring active casual clothes for yoga or just hanging out, with such lines as Stella McCartney and Splits 59. “Women today are wearing lots of active clothes,” Gold said. “They don’t simply want basics or technical clothes. They want clothes with a little more fashion but still casual and active in spirit.”

 

“We really want this world to feel more like a boutique than what you might find in a large department store. It’s a much more hands-on approach to product presentation in the mixing of categories and classifications.”

 

The Cusp conversions bring “lots of visual energy,” Gold said. “There’s much more color. The fixtures and mannequins are all different. We’ve changed the music. We have a different dress code. It’s more relaxed.” The associates can wear jeans, if they choose to, and special Cusp shopping bags and packaging have been created, Gold noted.

 

“There’s a very different sensibility,” Gold added. “Cusp feels younger and more modern. It is a very healthy business. Definitely, it is the most highly trafficked,” area in the store. “It’s fun to shop. Literally, it draws kids in college to women in their Fifties and Sixties. Many of the clothes have a more contemporary fit, so certain classifications not every woman can wear. The fit tends to be more of an issue with bottoms. And dresses tend to be a little bit shorter. But there are still tons of sweaters and novelty tops. There are elements every woman loves. If maxi dresses are a trend, everyone buys them. And if you are in good shape, regardless of your age, it all works for you.

 

“This is an effort to take it [contemporary] to a whole new level and create a physical area as dynamic as the product. It’s something we can call our own,” Gold said.

 

Cusp also reflects the big picture at Neiman’s, which is to drive growth and possibly impress potential investors since the retailer is believed to be considering an eventual public offering. This year, Neiman’s announced other growth maneuvers including spending $28 million to invest in an e-commerce business in China, which will help Neiman’s launch its own Web site there. Neiman’s also installed Joshua Schulman as president at Bergdorf Goodman, which operated without one for about two years, and has been accelerating growth of its outlet and e-commerce businesses, and in the past considered the possibility of opening additional Bergdorf locations. Officials have acknowledged exploring sites overseas to open Neiman Marcus stores, since Neiman’s already operates in most affluent communities in the U.S. that could support the luxury store.

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