The Hudson’s Bay Co. has begun meeting with investors to spin off Saks.com into a public company sometime in the future, WWD has learned.
“They want to split Saks.com from the Saks brick-and-mortar stores,” a source told WWD. “Hudson’s Bay is meeting with investors now to do a private placement in Saks.com, putting it in a position to do an IPO in the next 12 months.”
The maneuver would create a freestanding Saks Fifth Avenue brick-and-mortar chain of stores, and a freestanding Saks.com company, and the two companies would have an exclusive agreement between them in order to mimic an omnichannel world, the source said.
Saks.com generates about $1 billion in annual sales. That’s roughly twice the volume of the Mytheresa luxury website that went public Thursday and saw its stock price quickly soar.
Hudson’s Bay would be encouraged by the successful launch of the Mytheresa IPO. The Munich-based Mytheresa priced its initial public offering at $26 a share and then saw its stock rise 26.2 percent above that elevated price to $32.82 in midday trading Thursday. That left the company with a market capitalization of $2.9 billion, trading under the ticker MYTE on the New York Stock Exchange.
Marc Metrick, president and chief executive officer of Saks Fifth Avenue, would be the likely candidate to lead the Saks.com company. At this early juncture, it’s unclear who would run the separate Saks Fifth Avenue brick-and-mortar company.
By first doing a private placement with Saks.com, Hudson’s Bay raises money and sets a value for the dot-com business, which would help make potential investors comfortable about taking the e-commerce company public.
According to industry sources, it is believed that the maneuver by Saks, separating its website from the brick-and-mortar stores as its own company, would be a first in the retail industry.
According to Saks Fifth Avenue executives, Saks.com has been on a roll over the past year, with double-digit increases. Like many other dot-com businesses, the growth has been spurred by the pandemic and the ongoing shift by consumers to shopping more online, and less in stores.
It’s also been spurred by its relaunch in October, after a year and a half working to overhaul it and re-platforming with Salesforce Commerce Cloud, enabling Saks.com to capture more data on users, leading to messaging that furthers personalization. The overhaul, a bid to capture greater e-commerce, was also designed to make the journey online faster and easier with different “pathways” to the purchase.
In the Saks.com redesign, men’s wear, which the retailer’s executives have been touting for some time as a best-selling category, was propped up with its own homepage for the first time, which leads to a designated men’s section. Women’s shoes, handbags, jewelry and fragrances have also been singled out as generating gains.
It’s important that Saks enhances its website to offset, as much as it can, declines in brick-and-mortar stores due to the pandemic.
Saks.com was also redesigned with a “new arrivals” section, which every week features new products. By having one destination for new arrivals, it’s easier for customers to shop the newest, freshest merchandise. Saks.com gets close to 1,000 new products a week for women, 400 or so for men.
There’s also an expanded “edit” section, hosting shoppable editorial content including seasonal trend stories and influencer-curated product arrays; “designer spotlight” sections for men’s and women’s calling out new and emerging brands, and “pillar” brands; an upgraded “wish list” that indicates more details on selected products as well as whether they’re in stock, if inventory is limited, or if a product is eligible for a promotion, and fewer clicks required to complete a purchase. Saks.com also automatically makes “complete the look” recommendations, displaying two or three items, such as shoes and handbags, to go with a dress or a skirt.
“We really redesigned the site for fashion, personalization and ease,” Saks Fifth Avenue chief marketing officer Emily Essner, who is responsible for marketing and the digital business, told WWD in October.