Betting On A Little Luxury In A Bad Economy

Posted on | August 26, 2008 |

Amidst all the scaling back of late, two big-deal companies are placing bets that consumers want some luxury – on small items and at pared-down prices.

CVS recently announced that it would test a high-end beauty shop, called “Beauty 360,” next to some of its drugstores. The stores are set to carry luxury skin care, cosmetic and fragrance brands, and are even considering offering mini beauty treatments like manicures and hand massages. Based on the renderings and information featured in WWD, Beauty 360 stores look like they could be poised to compete with Sephora – especially if CVS leverages its thousands of existing stores and customers’ trust in the brand.

And CVS is choosing to start this shift in an economic climate that is, by almost all accounts, not ripe for retail expansion.

Mary Lou Gardner, CVS’s senior category manager for beauty, had this to say about the new stores: “If you create the right environment, you can sell any brand.”

As websites and online marketers, the environments we create consist of the text, images and layouts on a screen. Creating a unique web environment where browsers and shoppers want to spend time can be even more challenging than building a bricks-and-mortar store – there’s less diversity at your disposal, and a much smaller space with which to draw people in.

But perhaps we can take a clue from Gardner’s team, and from Mickey Drexler, retail CEO extraordinaire and J. Crew’s current head. Drexler, too, wants to create inviting spaces where shoppers want to hang out. And he’s injecting more luxury into his brands, too, sourcing fabric from higher-quality European mills and concentrating on tiny details like buttonholes.

Just because consumers are reigning in spending, doesn’t mean they want to be makeup-free or outfitted in burlap.

Creating a beautiful browsing experience and pointing customers towards luxurious-yet-affordable products are strategies that we can easily shift to the Web. Let’s just I can convey all that to our new site’s designers.

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