At Saks.com, a Sweeping Change in the Work Culture
Saks, the e-commerce business of the Saks Fifth Avenue brand, is changing its work culture.
Executives say the company is breaking down silos and has repositioned teams for closer collaboration and greater agility, and to apply data insights more effectively to buying, planning and marketing. The goal is to capture greater market share and provide a better online experience for customers.
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That’s all according to Marc Metrick, chief executive officer of Saks.com, who also told WWD that another round of layoffs has been initiated, involving under 5 percent of the corporate workforce.
Another source said 30 people are being let go at Saks corporate, located in Brookfield Place in lower Manhattan, where there are about 1,000 individuals. Saks.com has a total of about 2,000 employees. Last January, around 100 Saks employees were let go.
Metrick said the latest round of layoffs is unrelated to how the staff is being repositioned to work differently, which he said is “the next step in the evolution of our business. We’re reinventing how to do business the way that is best for the customer.”
The key changes at Saks.com involve the creation of 10 “pods” for the different categories of business with each pod consisting of individuals on category growth, buying and planning teams working together. Pods have been organized in key categories including: women’s apparel; women’s accessories; men’s; beauty; jewelry; home, and marketplace. Each category will be led by a general manager, a newly created role on the category growth team.
Along with that comes an enhancement of the category growth function.
“It’s a role and a function that is being amplified starting today and over the next six months so we’re going to grow it even more. Those people watch what’s happening on the site from an analytical standpoint and a merchandising standpoint,” Metrick explained. “What products are popping? What is getting the most views? What are the search terms being used on a daily basis? People are searching for bathing suits. People are searching for high heels. People are searching for Western shirts — whatever it is.”
Those in the category growth role, Metrick said, examine which customer segments are shopping which categories and brands, and when they’re shopping. “They’re doing all sorts of things,” Metrick said. “They’re going to be partnered up inside of these pods with folks from our merchandising team,” which includes the buyers and planners.
“You’re getting over a million visits a day on the website. How does it feel? How does each customer get a different experience? And to do it effectively, we have to set ourselves up differently to enable our teams to work much more hand-in-hand to get that experience right,” Metrick explained. “It’s going to be a better digital experience for the customer, and a better growth opportunity for us.”
Tracy Margolies, chief merchandising officer of Saks, in a letter to vendors that went out Thursday, wrote, “We are taking steps to fully integrate a new e-commerce-focused approach into how we market and merchandise our assortment on Saks.com, while continuing to serve our partners at the Saks Fifth Avenue stores. We are repositioning internally to empower our buying, planning and category growth teams to collaborate most effectively as they work to demonstrate Saks’ fashion authority and offer an even better experience for you, our brand partners.”
A third major change associated with the reorganization involves reallocating responsibilities of several executives, as follows:
Anna Irving, previously general merchandise manager (GMM) of women’s designer ready-to-wear, has transitioned to the category growth team in the newly created role of general manager, men’s, to drive the men’s business strategy online.
Will Cooper, GMM women’s footwear, handbags and accessories, is expanding his responsibilities to also lead the buying strategy for designer women’s apparel.
Dayna Ziegler, GMM for women’s contemporary and modern ready-to-wear, kids, swim, outerwear, lingerie and dresses, is expanding her responsibilities to lead the buying strategy for contemporary women’s footwear, handbags and accessories.
Louis DiGiacomo, the men’s GMM, continues to lead buying for the men’s business, working with Irving. Kate Oldham continues as GMM for beauty, jewelry and home.
There has been some speculation that resources are being steered into building up Saks.com at the expense of the Saks Fifth Avenues stores. But Metrick and Margolies stressed that the reorganization of the teams at Saks will also benefit the Saks Fifth Avenue stores and the experience at those stores. The merchandising and marketing teams at Saks.com also handle the merchandising and marketing for the Saks Fifth Avenue stores.
Metrick told WWD that investments are being made to improve certain Saks Fifth Avenue stores, such as in Los Angeles, where the Saks store is relocating to the former Barneys New York site on Wilshire Boulevard in Beverly Hills for an early 2024 opening. It’s a $52 million project.
Additional investments in the stores involve opening “shop-in-shops” across the fleet, including a significant investment in Saks Fifth Avenue Boston, and continuing renovations on the men’s floors in the Manhattan flagship and at Saks in Atlanta.
Saks.com, officially called Saks, and the Saks Fifth Avenue stores, officially called SFA Stores, were split into separate companies more than two years ago. Insight Partners, a private equity firm, invested $500 million into Saks.com, becoming a partner with Hudson’s Bay Co. in the business. The Saks Fifth Avenue stores are wholly owned by HBC.
While the teams at Saks.com handle the merchandising and marketing for both the e-commerce website and the Saks Fifth Avenue stores, the two separate companies have worked out many agreements on how they will work with each other and share functions and services.
“We have to absolutely make sure that our stores receive the right assortments, the right marketing and the right communications,” Metrick said. “So how do we do that, while at the same time, really set ourselves up to operate with the speed, agility and flexibility that you need to have as a [separate] e-commerce pure play?”
Answering his own question, he said Saks does it by ensuring “the teams are working together so that both the the category leadership and the merchandising leadership in the pod are always understanding what the other one is doing and what’s happening there. So there’s going to be reorganizing how we set up the pre-season category strategy, reorganizing how we set up the in-season, weekly, daily, minute-by-minute interface between our category leadership and our merchandising leadership.”
Metrick said that all 1,000 people in the corporate offices would be affected by the reorganization, though roughly half the organization, on a day-to-day basis, would be changing the most how they operate. “It’s about speed, and agility,” said Metrick. “That’s the name of the game.
“This is going to be a very smooth evolution for the organization,” Metrick assured. However, Margolies’ job, Metrick added, becomes more complex. “But her ability to impact and strengthen the two channels is going to be strengthened by this. That’s a big deal”
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