Marc Metrick finds himself in charge, after almost two decades at Saks Fifth Avenue and its new owner, Hudson’s Bay Co.
NEW YORK — Marc Metrick stepped off a freight elevator at Saks Fifth Avenue one recent afternoon and navigated his way past mangled wires and bare concrete beams, his Prada lace-ups crunching on broken glass.
“The staircase is going to come up here,” he said, on the gutted fourth floor. Turning toward a jumble of boxes, he added, “And here’s our fur business.”
“It might look like nothing to you right now,” said Metrick, the retail chain’s president, “but to me, it’s a passion project.”
Job: President of Saks Fifth Avenue
Education: Bachelor’s degree in business administration from Boston College
Career: Spent 15 years at Saks Fifth Avenue, becoming chief strategy officer. Joined Hudson’s Bay Co. in 2012 and helped with its acquisition of Saks. Named Saks president in April.
Quote: “I wasn’t a fashion guy; I didn’t have a Saks nearby. But every year, right around this time of year, like all good Jewish families, we’d pile into the car and drive into the city. And we would see the Saks windows.”
Source: NYT, Hudson’s Bay Co.
Department stores, as a class, are under siege: Online retailers are making inroads into luxury, off-price outlets are peddling name brands at deep discounts and there has been a shift in where and how people shop. But Saks, the 91-year-old department-store chain that long defined U.S. fashion and luxury, is betting that shoppers still care about glamour. It is pinning its hopes on a $250 million, three-year restoration of its Fifth Avenue flagship store.
Most Read Business Stories
- License plate scanners were supposed to bring peace of mind. Instead they tore the neighborhood apart.
- Medicare Advantage is cheaper for a reason — beware
- Here’s one more sign of cooling in Seattle’s hot housing market
- Nuclear fusion edges toward the mainstream
- Inside Amazon’s worst human-resources problem
It has fallen on Metrick, a 42-year-old father of two, to undertake a Saks revival. He was not the first choice of the Hudson’s Bay chairman, Richard Baker, whose company snapped up Saks in 2013 for $2.4 billion. The task initially was assigned to Marigay McKee, who led a turnaround at the British luxury-department store Harrods.
But in April, McKee was ousted after just 15 months on the job because of what insiders have described as a personality clash with top executives at Hudson’s Bay, which also owns Lord & Taylor.
Metrick, who worked for almost two decades at Saks and Hudson’s Bay in less glamorous positions like chief administrative officer, gives off the air of a corporate lifer who has long toiled for uninspired bosses and now unexpectedly finds himself in charge.
“You spend your whole life saying, ‘If I was in charge, I would. If I was in charge, I would,’ ” Metrick said. “You have all these ideas. Then all of a sudden, I can.”
For Metrick, reinventing the flagship is a priority. A lavish, indulgent in-store shopping experience, he said, was something that online retailers could never replicate. But he said Saks, even its flagship store, needed to work on its game.
“Look at this. People are moving around you, they’re bumping into you, they’re coming off the elevator,” he said on the store’s ground floor, a vast concourse populated by shiny cosmetics counters. “When you look at the store from the outside, it’s huge, but when you go in, you almost can’t tell that there are other floors.”
Metrick complained about Saks’ restaurant on the eighth floor, Cafe SFA. “I never thought it was a productive thing to have a restaurant back here,” he said, waving his hand toward a lunchroom with customers seated at only a handful of tables. “See how it’s empty?” And a terrace outside the shoe floor on eight, which overlooks Rockefeller Center, is currently in disuse, he grumbled. “What a waste. Imagine having dinner out here, or lunch. Or coming out here with a drink,” he said, warming to the idea. “Shoes and booze!”
To open up the entire store to shoppers, Saks is making some radical changes. It is punching a hole through the ceiling of the ground floor to make way for a 23-foot-high spiral staircase, wrapped around a glass elevator. The beauty department will jump to the second floor, leaving the first floor to handbags and other accessories.
About 55,000 square feet of backroom space in the basement will be transformed into a boutique for fine jewelry to be called the Vault. (Think of “million-dollar pieces,” Metrick says.)
To some observers, the Saks overhaul is puzzling.
“Are there not enough people going upstairs? Then something’s not working,” said the department-store historian and author Michael Lisicky. “And why would anyone want to buy expensive jewelry in the basement?” he said. “You have to know your shopper.”
Even among full-price stores, Saks faces stiff competition on its home turf. Bergdorf Goodman, another Fifth Avenue stalwart, is going through its own revamp. Neiman Marcus and Nordstrom have said they will open their first Manhattan locations in 2018.
Saks sorely needs a turnaround. In the second quarter, Hudson’s Bay booked sales of $2 billion, a 15.2 percent increase from last year. But sales at Saks Fifth Avenue were flat, compared with 12.7 percent growth in Saks Off 5th stores, and 4.9 percent growth at the group’s other retailers, Lord & Taylor and Hudson’s Bay.
Federica Levato, a principal at Bain & Co., the consulting firm, said reinvigorating the flagship was a prudent move, especially if it diversified beyond apparel and beauty.
“But this will not be a game-changer in the future of their core business,” Levato said. People who are buying online or off-price, “will keep buying online or off-price,” she said.
One way Hudson’s Bay is tapping Saks is by monetizing the flagship’s valuable real estate. In 2014, the company took out a loan against the Fifth Avenue location that valued the store at $3.7 billion, more than Hudson’s Bay paid for the entire Saks chain.
Metrick remains focused on Saks’ retail business. When Hudson’s Bay bought Saks in 2013, many senior executives quickly departed. Metrick, who had been wooed away by Baker the previous year, returned to Saks, becoming its chief administrative officer.
At times, it seems Metrick still cannot believe that he is now at Saks’ helm. He recalls growing up on Long Island and taking trips into the city.
“I wasn’t a fashion guy; I didn’t have a Saks nearby. But every year, right around this time of year, like all good Jewish families, we’d pile into the car and drive into the city. And we would see the Saks windows,” he said. “We’ve come full circle now, because I’ll be unveiling them in a few weeks. I think that’s kind of cool.”
On the Saks terrace, Metrick clambered onto an exposed ledge and leaned precariously over the street below, explaining that he had been photographed there the previous day.
“Don’t!” his handler cried in alarm. Metrick climbed down, looking impish as a schoolboy caught in a reckless prank. He would never have done something like this as chief administrative officer. But as Saks president, he is taking liberties.