U.S. consumers plan to spend more on luxury gifts this year. According to consulting firm PwC, almost 40% of consumers will spend more than they did last year, and those who make at least $120,000 will spend an average of $3,000 on gifts.
To retain its core customers and attract new luxury shoppers, Saks has ambitious plans. The retailer’s holiday strategy popularly includes its iconic holiday window displays, its NYC flagship light show and its fall sale. In 2022, Saks partnered with Sir Elton John for a holiday campaign that included a concert at the flagship location and an Elton John x Saks Fifth Avenue holiday product collection.
This holiday season, the 99-year-old retailer is betting big on immersive and experiential moments to drive sales.
In 2022’s third-quarter earnings for the period ending in November, Saks reported that its quarterly site traffic increased by 39% year-over-year and its new customer count grew by 14%. In addition, the number of new and existing customers who shopped on Saks.com during the quarter increased by 28% year-over-year.
To keep that momentum going, for the first time, Saks is teaming up with luxury fashion brand Dior for the holiday window displays at its NYC flagship location. In October, The Christian Dior group, reported an organic revenue growth of 14% in the first nine months of 2023. Starting November 20, Dior will take over the windows with a “Carousel of Dreams” display, featuring Dior signatures such as its star, as well as the signs of the Zodiac. A customized light show will accompany it.
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“A lot of of big retailers, like Macy’s and Saks, do a window unveiling and come up with creative ways to get people to come back and look in the windows,” said Sonal Gandhi, chief content officer at media and events company The Lead. “[Saks] is a quintessential New York, Fifth Avenue Christmas brand. They are right across from the Rockefeller Center tree, and they always make the holiday windows big. They’re leaning into their heritage [with this immersive collaboration].”
According to Gandhi, we’re now living in an attention economy, and creating buzzy moments is key to retaining consumers’ interest. Saks executives were unavailable to comment on this story.
The Saks-Dior collaboration will also include a “World of Dior” digital pop-up on Saks.com, marking the first time all of Dior’s product categories will be sold via e-commerce anywhere other than Dior’s own website.
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Saks CEO Marc Metrick said during September’s second-quarter earnings call that he expects the brand’s core luxury consumers will spend the same if not more this holiday season.
To help clinch these sales, Saks has also rolled out what it’s labeling as one-of-a-kind holiday experiences. The experiences, which range from $1,500-$30,000, include the opportunity to host a party at the Saks flagship’s private NYC rooftop ($30,000) and access to NYFW events ($15,000), the latter of which also comes with a $5,000 Saks gift card. Other experiences include a private holiday shopping trip at Saks ($1,500), an omakase dinner at home ($5,000), a holiday decorating session for the home by Saks ($10,000), a Valentine’s Day experience at the L’Avenue at Saks restaurant ($3,000) and VIP access to the Saks Holiday Show in November ($5,000).
“There’s certainly been some softening of the luxury market recently, and most [luxury] brands make the most of their bottom line during these last [three] months of the year. These experiential moments offer a new way for people to get excited about the brand,” said Gandhi.
Historically, spending in Q4 has led to significant growth in the luxury market. In the fourth quarter of 2022, the luxury market grew 7% organically year-over-year. However, continued economic pressures have analysts lowering their expectations for luxury holiday spending in 2023.
According to Saks.com, each purchase of this year’s Saks experiential gifts supports the Saks Fifth Avenue Foundation, an organization that works to prioritize mental health in all communities. All experiences are available for purchase until sold out.
