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#Harrods #LuxuryRetailer #Challenge

December 17, 2019

Harrods may be the largest upscale department store in Great Britain, taking up a full block of London’s Knightsbridge neighbourhood, but in a rapidly changing retail landscape where experience, newness and digitisation are key, its stuffy take on luxury is looking outdated.

Now, the store is playing catch-up in an effort to maintain its status as a mecca for the mega-rich, kicked off by a £300 million, three-year redevelopment, the largest capital expenditure in its history. There’s a new experiential beauty hall, a revamped menswear floor that adds 50 percent extra space, new fine jewellery and watches halls and four refurbished food halls — all designed to target the next generation of luxury shoppers. The wealthy ones, that is.

Harrods’ focus on the future comes as department stores globally face a challenging retail landscape. UK department stores sales dropped 2 percent in the third quarter (the biggest decline since the first three months of 2009, when Britain was mired in recession). It’s a similarly tough environment for US rivals like Saks, Nordstrom and Bergdorf Goodman, who have also invested heavily in splashy renovations and taken risks on new models like rental pop-ups. (Some have gone bankrupt along the way, including fashion industry favourite Barneys New York.) So can Harrods make it work?

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