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Saks' New Strategy: Make the Saks Off 5th Outlet 'A Mess'

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Photo by Brian Harkin
Photo by Brian Harkin

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Saks Fifth Avenue is undergoing a revamp—and its sister outlet Saks Off 5th will undergo a so-called devamp. Now that it's owned by Canadian department store company Hudson's Bay Co., Saks' top guns want to kick up the retailer's brand to a higher stratosphere of luxury, while they make Saks Off 5th outlets a total mess.

Richard Baker, top exec of Saks' new Canadian overlords, told The Wall Street Journal, "Our outlet stores look too much like department stores. Nordstrom Rack is a mess, and customers love it." To get that Rack feel, Off 5th plans to organize shoes by size rather than brand, pile up stuff more generously and include overstock from Lord & Taylor, which Hudson Bay also owns.

On the higher end, Saks stores are getting a $1 billion investment, various handbag sections will get an expansion and the company will try to persuade luxury designers to allow it to carry merch like $48,000 bags and $1,500 shoes. Hudson Bay's intends its play to the extremes to reflect the current American economy, in which one percenters are free to spend, while the rest have resigned themselves to picking through the leftovers in some dusty outlet mall off the freeway.
· Saks Reaches to Uber Luxe, Stays Mindful of the Masses [Racked]
· Saks Off 5th Outlets Hitting Wisconsin, Mississippi, Ohio, MORE [Racked]