Luxury retail giant Neiman Marcus has been a household name for over a century, catering to the elite and affluent consumer market. However, with the rise of e-commerce and changing consumer behavior, the company has faced challenges in recent years. To stay ahead of the game, Neiman Marcus has implemented a strategic plan aimed at capturing the luxury consumer market. This plan includes a focus on digital innovation, personalized experiences, and sustainability.
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By leveraging technology and data to create a seamless omnichannel experience, Neiman Marcus aims to attract and retain high-end customers. Additionally, the company has made a commitment to sustainable practices, such as reducing waste and carbon emissions, to appeal to the growing demand for eco-conscious luxury brands.
In this article, we'll take a closer look at Neiman Marcus' strategic plan and it's marketing strategy to drive luxury retail sales. We examine the NM brand, the customer experience, the digital customer, and marketing that speaks to luxury. We also explore why NM's marketing strategy works and offer lessons for other luxury brands.
The challenges faced in the current luxury retail market
Neiman Marcus is one of the oldest and most well-known high-end fashion retailers in the United States. The company has been around since 1907, when it was founded by Herbert Marcus Sr. and his brother Joseph Neiman in Dallas, Texas.
Today, it operates 37 stores nationwide--including flagship locations in New York City and Chicago--and sells luxury brands like Gucci and Louis Vuitton alongside accessories like Tiffany jewelry.
The NM brand is recognized around the world for its dedication to providing high-end retail experiences. From the iconic Neiman Marcus Beverly Hills store to their digital presence, NM has quickly become a leader in luxury retail. However, the luxury retail market has undergone a significant shift in recent years, with the rise of e-commerce and changing consumer behavior. Neiman Marcus, like many other luxury retailers, has faced challenges in adapting to these changes.
In 2017, the company reported a decline in sales and had to lay off employees to cut operation costs. Additionally, Neiman Marcus has faced competition from online retailers and new luxury brands entering the market. The company has also struggled to connect with younger consumers, who have different shopping habits and values than previous generations. In May 2020, Neiman Marcus had filed Chapter 11 bankruptcy. In August 2020 Neiman Marcus announced it will be closing 22 stores for good, at the height of the COVID-19 pandemic. In 2023, the company said it will be laying off 5% of it's workforce, to save money on operating costs and may close more stores.
Neiman Marcus has responded to these challenges by implementing a new strategy that focuses on retail innovation, personalization and sustainability. The company aims to leverage technology and data to create a seamless omnichannel experience that engages affluent customers across all touchpoints.
Neiman Marcus' luxury shopping experience
A high-end shopping experience is essential when it comes to driving sales in the luxury retail space, as customers need to trust that products sold by the retailer are worth the price tag.
NM's stores and online presence both offer luxurious experiences and superior customer service. The stores are designed to be a relaxing and inviting space where shoppers can take their time browsing the latest offerings and ask questions of the knowledgeable staff.
NM's fashion campaigns, website and marketing reflect this approach, focusing on conveying the message of quality over quantity, with the focus on shopping exclusive and limited time designer clothing, accessories and beauty. Neiman Marcus recognizes that the customer experience is paramount when it comes to driving luxury sales.
Online, NM offers an equally engaging experience, with easy-to-navigate websites and helpful product descriptions that help customers make the right purchase decision. With their increasing footprint in the digital space, NM is reaching a broader audience to drive luxury sales.
Through strategically crafted marketing tactics and designer campaigns, NM presents their brand as a leader in luxury retail and conveys the message that they are a retail destination worthy of the highest quality items and experiences. NM's campaigns typically feature tasteful yet eye-catching visuals, highlighting their product selection and commitment to service.
In addition, to both online and retail marketing initiatives, Neiman Marcus has also launched an app to make it easier than ever for shoppers to conveniently shop on the app, keep up with the latest fashion and reap additional in-app rewards.
Strategic plan for attracting luxury customers
Neiman Marcus' strategic plan focuses on three key areas: digital innovation, personalized experiences, and sustainability. By investing in these areas, Neiman Marcus aims to attract and retain high-end customers who are looking for a luxury shopping experience that is both convenient and sustainable.
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According to a Klarna’s Luxury Survey, luxury consumers are more likely than other shoppers (including those who buy non-luxury goods) to shop online at home instead of on the go with their smartphones.
They also tend not only use their phones but also tablets when shopping online as opposed to desktop computers which is why it's important for brands selling luxury products such as Neiman Marcus that they have an optimized mobile experience so that these customers can easily find what they're looking for without having trouble navigating through pages or getting frustrated by long load times.
Exclusive, personalized and invite-only client experiences
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Neiman Marcus has invested heavily in digital innovation to create a seamless omnichannel experience for customers. This includes the development of mobile apps and online platforms that allow customers to shop online, make purchases, and track their orders.
The company has also implemented a digital clienteling program that enables sales associates to provide personalized recommendations and styling advice to customers; in addition to their highly coveted invite-only events.
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NM hosts in-store client events and fashion shows such as the Neiman Marcus Fashion Show in partnership with Mercedes Benz to the Oscar de la Renta show in Miami. Lastly, NM has implemented a loyalty program and credit card program that rewards customers for their future purchases and provides exclusive access to events and discounts.
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In addition to digital innovation, Neiman Marcus has also focused on creating personalized experiences for luxury shoppers . The company has a range of personalized services, such as personal shopping, alterations, and bespoke tailoring, to provide customers with a unique and tailored shopping experience.
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Most recently, Neiman Marcus hosted an honorary awards night in Paris,' NM gathered for an intimate ceremony to honor the Neiman Marcus Awards 2023 winners: Brunello Cucinelli, recipient of the Award for Distinguished Service in the Field of Fashion; Jonathan Anderson, who received the Award for Creative Impact; & Amina Muaddi, accepting the Award for Innovation.
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Sustainability initiatives in Neiman Marcus' strategy
Neiman Marcus has also made a commitment to sustainability, recognizing the growing demand for eco-conscious luxury brands. The company has implemented Our Journey to Revolutionize Impact' ESG Report , covering sustainability initiatives such as reducing waste and carbon emissions, and sourcing sustainable materials. Key areas within the report also include Climate Change and Workforce Diversity boast additional 2030 goals.
"As a leader in luxury retail, ESG is an essential part of our growth roadmap, and we're excited to share our inaugural progress report," said Geoffroy van Raemdonck, Chief Executive Officer, Neiman Marcus Group. "'Our Journey to Revolutionize Impact' for our communities is one of our top priorities, and we believe our strategy of advancing sustainable products and services, cultivating a culture of Belonging, and leading with love in our communities will help pave this journey."
NMG aims to make an impact on environmental issues across the entire value chain:
- Reduce Scope 1 and Scope 2 emissions 50% from a 2019 baseline by 2025, and perform a Scope 3 assessment in 2022 to understand the company's position and chart a path toward a Net Zero goal
- Procure 100% renewable energy by 2030 across the business and join RE100
- Eliminate all products containing fur listed in NMG's Animal Welfare Policy by 2023
- Increase revenue from the sale of sustainable and ethical products by 2025 by launching two new Sustainability Edits across Neiman Marcus and Bergdorf Goodman that identify multiple categories within sustainable and ethical fashion to help shoppers make informed purchasing decisions and shop in line with their values
- Extend the useful life of over 1,000,000 luxury items through circular services such as mending and alterations, restoration, resale, and donation by 2025, building on the 350,000 products addressed in FY21 and committing to creating a FASHIONPHILE Selling Studio that authenticates and intakes luxury product from customers inside every Neiman Marcus store
By investing in digital innovation, personalized experiences, and sustainability, Neiman Marcus has been able to attract and retain high-end customers who are looking for a luxury shopping experience that is both convenient and sustainable.
Neiman Marcus introduced a "resale as a service" program in partnership with Fashionphile, allowing customers to sell their pre-owned luxury items through the company's online platform.
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How Neiman Marcus' strategy compares to other luxury retailers
Neiman Marcus' focus on sustainability sets it apart from other luxury retailers. The company's commitment to reducing waste and carbon emissions, and sourcing sustainable materials. The company's focus on sustainability has also resonated with customers who are looking for eco-conscious luxury brands. Moreover, it is particularly important for younger consumers who are increasingly conscious of the impact of their purchasing decisions on the environment.
However, Neiman Marcus' strategic plan is similar to other luxury retailers who are also investing in digital innovation and personalized experiences for customers. For example, other luxury brands and retailers such as Nordstrom has introduced a range of personalized services, such as styling advice and alterations, all in which Neiman Marcus also has available to it's luxury shoppers.
Similarly, luxury fashion brand Burberry has invested in digital innovation, such as the introduction of virtual reality technology in its stores, and has made a commitment to sustainability, such as sourcing sustainable cotton and reducing waste.
Neiman Marcus future in the luxury retail market
Neiman Marcus' strategic plan has positioned the company to stay relevant in the ever-changing luxury retail landscape. By investing in digital innovation, personalized experiences, and sustainability, Neiman Marcus has been able to attract and retain high-end customers who are looking for a luxury shopping experience that is both convenient and sustainable.
The company's commitment to sustainability sets it apart from other luxury retailers and has set a new standard for the eco-conscious at the luxury level. As the luxury retail industry continues to evolve, Neiman Marcus' strategic plan will be key to its future success.
