De Bijenkorf: "Make your shoppers feel that they are being spoiled"

De Bijenkorf aims for a wow effect and wants to adds luxury, but wants to remain accessible: a balancing act where every detail matters. This also applies to the web shop, because the most valuable customer shops both offline and online.

 

A trip

We are warmly welcomed at the head office in Amsterdam: CEO Giovanni Colauto is an enthusiastic discussion partner who is visibly proud of the company he has lead for six years. "All generations know De Bijenkorf, they associate our department store with the exceptional and they love the element of surprise. My aunt took me regularly to store in Amsterdam as a child, with tram 24. That was always a party! I especially remember the master pastry chef. A visit to the department store was always an experience."

 

What exactly makes the magic of a department store? Colauto thinks it is in the combination of a very diverse product range with strong brands in beautiful buildings: the many events bring experience, and of course there is the rich heritage, the history that the company can look back upon, the strong DNA. After all, De Bijenkorf has existed since 1870. Then he pulls a binder out of the drawer with a smile and we can read the words 'Future Vision' on the cover. This is what it is all about: the future strategy drawn up by the CEO for his chain.

 

Accessible

The department store now has seven stores in the Netherlands, three of which are real flagships (in Amsterdam, Rotterdam and The Hague). These are iconic buildings that are continually adapted and rebuilt to continue to meet the high customer expectations. This is achieved in collaboration with different architects: the stores are no copies of each other. "We want to make it special every time. What does the building demand? We aim for a wow effect. In Amsterdam we have just opened a new men's fashion department, with a different architect than on the ground floor. The Kitchen on the fifth floor was designed by Rob Wagemans of architecture studio Concrete. In Utrecht the restaurant was drawn up by interior architects i29 - we won a design prize with it. In Rotterdam we recently built a new floor and added more luxury brands."

 

Within the Selfridges Group, each department store has its own identity and is allowed to sail its own course, but with a common denominator: a luxury experience for the customers. "Of course there is collaboration: we exchange ideas and inspiration, and together we get easier access to major brands." Although Selfridges pursues a more pronounced premium strategy - albeit without neglecting the middle segment - Colauto wants to keep De Bijenkorf accessible for a wide audience. "The share of luxury brands is growing, the share of the middle segment is getting smaller."

 

Making choices

In the meantime, the department store landscape in the Netherlands has changed dramatically. What does the CEO think of the competition? "The demise of V&D was unnecessary. They just made decisions too late, they missed the boat. I have to congratulate Hudson's Bay because they show a lot of guts. The stores they have opened here look very neat, but the offer is not really new or distinctive. I think there is room for a department store in the middle segment, but then it has to be distinctive." V&D had too many small shops, and that does not work. De Bijenkorf made clear choices in this respect and now has more turnover with fewer stores. And what does he think of vd.nl, the online restart for the V&D chain? "A fascinating experiment. There is potential in it. A platform model is interesting, but not evident. How do you give it content?"

 

Online, De Bijenkorf is doing very well, he emphasises. "E-commerce is growing with double digits and now weighs nearly 200 million euros, while our total turnover is around 850 million. The online shop is our second biggest, we are tenth in the Twinkle100 (the ranking of online retailers in the Netherlands) and in fashion, we are in fourth place. And we are profitable! We are also doing well in Belgium: consumers there have good taste and show interest in higher priced items "

 

Increase conversion

While online is seen as a threat for many department stores, it is now one of the favourite departments of CEO Colauto. "The conversion is still somewhat lower online than in our stores, but we are working on that: in the first place by broadening the range of brands. We have luxury brands, but also Cos, Ted Baker or Levi's. A second axis is relevance: half of our visitors already see a personalised landing page. Finally, we also strongly focus on fulfilment, functionality. The fact that we, as one of the few, send all orders free of charge, is an important USP. If you do those three things well, then your future is assured. I still see many opportunities, both in the Netherlands and in Belgium. We have clear USPs. A competitor like mytheresa.com is very high in the market, Zalando on the other hand has no luxury."

 

De Bijenkorf's app now has half a million downloads, the loyalty program manages about one million addresses. "The most valuable customer shops both offline and online." In that respect, all indicators are green for the department store chain. "We measure a multitude of KPIs, but in the end it is all about visitors and conversion. Attracting and binding people. In the shops we see the number of visitors rising. That's a good performance. Online there is an even stronger increase. As a brand, we therefore get a lot more visitors. "

 

“Make it happen”

What are the main success factors for the department store, according to the CEO? "You have to distinguish yourself, to surprise people time and again. Make your shoppers feel they are being pampered: welcome them to the door, provide advice, organise events, do not forget the restaurant... The link between offline and online also becomes more important. When an item is not in stock, you will receive it the next day without shipping costs. Every detail matters. Our baseline is 'where everyone is special'. Look, that's the feeling you have to give people."

 

When asked what his best idea was as CEO, Colauto does not have to think twice: "I decided to increase the budget for training and education by one million euros every year. If you do not invest in your people, the company will still remain an empty shell. 80 % of our management functions are filled in by internal people. Our creative director started as a store design manager, then became head of the construction team, then led visual merchandising. Our CFO started as a controller and has been here for 14 years. 'Make it happen', that is our approach. Retail is a people's business."

 

But it is also a tough business. Where is the biggest threat? "That you do not react quickly enough to change. You have to show guts, a willingness to change, agility. Look at V&D: things went wrong. You have to keep moving with the market. Consumers today are very 'tech savvy', they expect new concepts." Then you have to get your employees involved in that story of change. "That is why we invest. Give them growth opportunities, trust, training. Anyone who leaves here with a good feeling becomes an ambassador for the company."

 

A love story

Does the CEO have favourite department stores? Of course: "Le Bon Marché remains a favourite, because of the French touch, the elegance, the local DNA. They have fantastic brands and a beautiful architecture. I also really like their food court. In Munich you have Ludwig Beck, a somewhat smaller department store with a boutique design. You see brands that you do not find everywhere. And then you have Barneys, with that real New York 'urban vibe'. A department store with a strong local identity. Wherever I am, for business or on vacation, I will always visit the local department store. What does the building look like, what is the layout? How is the atmosphere, the audience? How will I be received? Breuninger in Düsseldorf has become very beautiful. Alsterhaus in Hamburg is also worth the trip."

 

In short, it is a love story. "Certainly. Especially for the rich DNA, the grandeur, the history. The main condition is that department stores go along with their time, as Selfridges does. It is possible: in every business you can make money if you approach it in the right way, if you offer something special. Whether you are in department stores, in insurance or in museums: it does not matter. If you have something special, people will come. Price competition only arises when you are not special." The department store is also an interesting place to work and grow, he says. "You can learn a lot quickly. Look around you, taste the atmosphere, change departments regularly and broaden your horizon. I did that too."

 

"Champions League level"

Colauto has a financial background and started his career at trading company Hagemeyer. That company then sold brands such as Sony and McCormick in the Netherlands and the Netherlands Antilles. In 1998 he took the step to the retail world, at Hij/Zij Mode which later became WE Fashion. "I was responsible for finance and logistics. A difficult period: H&M came on the market and we were in the middle segment." In 2001, the switch to De Bijenkorf followed.

 

"This is surely Champions League level, you know. A very special, fantastic company, with a wide range of beautiful products. We survived the internet bubble, opened outlets, opened smaller stores... it was always interesting." He fulfilled various functions and saw several owners come and go, such as Vendex KBB and a number of venture capital funds. Since the department store came under Selfridges Group's wings in 2010, something has changed. The strategy now focuses very clearly on a 'premium experience'. A strategy that Giovanni Colauto has been able to write and implement as a CEO since 2012.

 

About the project

With the interview series 'A Love for Department Stores', retail expert Erik Van Heuven and journalist Stefan Van Rompaey (RetailDetail) set out to explore the world of department stores. Discussions with international investors and managers will identify the challenges and opportunities for this retail industry. In the digital age, department stores are not relics from the past, but the ultimate example of retail as entertainment. The interviews will appear on the RetailDetail websites in the coming months, in RetailDetail Magazine and will result in a book about the history and future of department stores in Europe.
 

As a former top manager at, among others, Galeria Inno and Karstadt, Erik Van Heuven knows the sector through and through. As chief editor of StoreCheck and RetailDetail, Stefan Van Rompaey has been following developments in the retail sector for decades.