July 31, 2024
iStock.com/Anne Czichos
Should More Luxury Retail Be Appointment-Only Like Saks Fifth in San Francisco?
Saks Fifth Avenue’s flagship store in San Francisco’s Union Square will switch to an appointment-only shopping model starting Aug. 28, 2024, likely aiming to offer more personalized service and address concerns about theft and staffing costs.
The move seems to be signaling a rising trend with luxury retailers to adopt appointment-only models. Other examples include Neiman Marcus in Las Vegas, Brunello Cucinelli in New York, and Gucci Salon in Los Angeles. This practice is also becoming more commonplace in Asian countries, especially for VIP clients, according to Amanda Lai, a director at McMillanDoolittle.
In this case, San Francisco’s rising retail theft rates may have also played a role in the decision to change models.
The shift will unfortunately result in job cuts at the Union Square location, a spokesperson told the San Francisco Chronicle, though Saks has not detailed the extent. While some upscale retailers continue to do business in Union Square, the area is facing major challenges, including a rising 20.6% retail vacancy rate, per CoStar’s data.
This is not the first time Saks has tried out appointment-only shopping. As reported by CoStar, “The luxury chain now has 16 ‘suites’ at hotels operating by appointment only,” though this seems to be the first standalone store to test the model.
Users on Reddit have shared varying opinions on the move, with many predicting that it signals the end for Union Square, or at least for department stores in the area. Most also voiced disappointment in the lack of freedom of being able to walk by and browse on a whim. Meanwhile, some workers expressed sadness when they learned of the news.
The change is aimed at catering to a more exclusive clientele but has been met with dissatisfaction from many customers, according to the San Francisco Standard. Shoppers expressed frustration at the loss of spontaneity and accessibility, with some feeling that the new system will make the store seem more elitist. Saks aims to align with luxury market trends, but local sentiment remains negative, with concerns that the store’s new approach will drive away regular customers, especially those who like to walk in once in a while or shop when they just happen to be in the area.
Natali Bagamyan, a tourist from Switzerland, told the San Francisco Standard, “Some shopping should feel like it has a bit of spontaneity. If I need to have an appointment, I won’t do it. It’s a bit of a buzzkill.”
Appointment-only luxury retail shopping could align well with the trends of “stealth wealth” and “quiet luxury.” While some fashion insiders have criticized “quiet luxury” as a reductive trend, it remains popular due to its emphasis on subtlety, quality, and sustainability over ostentatious displays of wealth. This trend, which gained traction through high-profile figures and media portrayals, reflects a shift toward more thoughtful, less conspicuous consumption.
The synergy between appointment-only shopping and these trends lies in the exclusivity and personalized experience that such shopping methods offer. By requiring appointments, luxury retailers cater to a clientele that values discretion and personalized service, enhancing the experience of understated elegance that “quiet luxury” embodies. This approach not only aligns with consumers’ desire for high-quality, sustainable goods but also supports the growing trend of valuing privacy and exclusivity over flashy consumption.
BrainTrust
Lisa Taylor
Retail Consultant, JL Buchanan
Mark Ryski
Founder, CEO & Author, HeadCount Corporation
Lisa Goller
B2B Content Strategist
Recent Discussions
Discussion Questions
How might the appointment-only model in luxury retail impact accessibility and exclusivity in high-traffic areas like San Francisco’s Union Square, and what could this mean for customer experience and the local retail scene?
How could the shift to appointment-only shopping affect consumer behavior in the high-end market?
In what ways do the motivations behind Saks Fifth Avenue’s switch to an appointment-only model align with broader trends in sustainability and stealth wealth, and what does this suggest for future luxury retail strategies?
Poll
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First, let’s be clear why Saks is implementing this in San Francisco. Moving to by appointment only is not some kind of superior business model, it is a response to both the fact the store isn’t working financially and soaring crime rates. The shift comes from a position of weakness, not of strength. Saks may eventually close the store, especially if the merger with Neiman Marcus goes through. More widely, appointment-based shopping may work for uber-luxury brands or in very niche locations. It will not work for larger stores or more mainstream luxury where passing trade, including from tourists and visitors, remains an important part of the sales mix.
Definitely a move from a position of weakness
Hopefully, this is a placeholder until the Neiman’s merger completes. It’s not a sustainable model for a flagship store in a location that heavily relies on spontaneous tourist traffic. That’s not to say that appointment-based retail isn’t viable for small-scale uber-luxury brands. However, regardless of size, Saks doesn’t qualify as a member of the rarified fashion club.
Finally!(I’ll take my referral fee in cash, no store credit please) Speculation is rife here in the city City as to the cause, with shrinkage and merger – the store is cross the square from likely-soon-to-be-stepstore Neiman Marcus – battling it out; but there’s no disagreement with the reaction: the idea is universally disliked. And it seems like a folly: we’re not talking about some resort shop or a designer boutique here, it’s a ~150Kgsf 6 story downtown store…this is more like a plot from the Twilight Zone than an intelligent marketing decision.
Desperate measures for desperate times comes to mind. Appointment only is not a model that is going to scale well. However, it is a model that may work well in 10-15 locations across the country as part of a larger set of full service stores. it may be the most economical in these few locations but it is not going to work in all locations. It will alos need to have a much different inventory allocation and a very strong set of Omni tools.
While there is a place for appointment-shopping, this isn’t it. Saks Fifth Avenue will see a drastic reduction in store visits and ultimately sales as a result of this move, and it will impact Union Square as a shopping destination. The luxury appointment shopper may get better service, but Saks is trading that off against all incidental and aspirational shoppers and the revenue these store visits generate. Instead of appointment-only, these luxury retailers should be thinking, ‘appointment AND causal shopping’.
Prevent retailing at its finest
Combine it with Amazon just-walk-out technology & you’d achieve the ultimate: a store with no customers or employees.
Let’s be realistic, this has all the appearance of being motivated exclusively to combat theft. Appointment-based retail worked for stores that were forced to close during the pandemic – when there was no other option. For sure luxury brands and some highly specialized product purchases (think of buying complex photography or video recording gear where you might want a consult to help you choose what to buy) this can work, But for an entire department store the size of a Saks flagship? For all customers and all purchases? I don’t see this lasting long-term. Again, for a small boutique, sure, it will work. When consumers want that consultative expertise to guide them on their shopping journey, yes, but for general spontaneous shopping this is more of a hindrance and just adds friction.
Some of the lines to get into luxe stores like Louis Vuitton etc are so long … maybe more by-appointment-only shops can improve the experience, though I don’t think it will do do for Saks
While I understand the financial realities and crime concerns for this location I see it as an unfortunate turn of events. Appointment shopping is absolutely part of the luxury mix but so is the in store experience with the ability to browse, engage and be inspired. You certainly don’t need that much space to serve appointment only customers. I am curious to see how things evolve in this location.
For destination shoppers seeking a particular dress, jacket, or suit, Saks Fifth Avenue’s “by appointment only” service is an invaluable service. An ideal shopping experience is provided by personalized advice, assistance, and service.
Customers receive one-on-one attention from experienced experts who understand their unique preferences and needs. This approach helps shoppers discover the ideal item, all while having a more relaxed and pleasurable experience. Moreover, it saves time because qualified employees can swiftly pinpoint appropriate choices, rendering the shopping excursion efficient and devoid of stress.
Customers who use this service can bypass long lines in busy departments, queues at checkout counters, and delays for dressing rooms.
A relaxed and tailored shopping experience makes customers feel valued and catered to, enhancing their satisfaction. Their personalized attention helps them find exactly what they need without the stress of navigating crowded stores. Additionally, the service is efficient, which provides a more enjoyable shopping experience.
In contrast, the non-destination shopper who browses the store at leisure doesn’t want a walking shadow following them around.
Appointments are ideal in certain circumstances, however, they may not be appropriate in all circumstances and situations. Appointments should only be scheduled by consumer choice.
While scheduled appointments offer personalized service and efficiency, allowing customers to find exactly what they need without the stress of crowded stores, spontaneous shopping provides the freedom to explore at one’s own pace.
Those who enjoy browsing and discovering new items without a structured plan can find joy in the spontaneity and flexibility of unscheduled visits. Ultimately, the choice between a scheduled appointment and spontaneous shopping depends on individual preferences and the specific shopping experience one seeks. -Db
Should luxury retail be by appointment only? Absolutely not, who’s got time for that?
Shoplifting is so out of control in San Francisco this seems like a last resort. I get it, it’s survival. But when I think of centers like The Forum Shops at Caesars in Las Vegas, where every other store is high end luxury retail, it’s ridiculous. Or as the tourist from Switzerland said in the article, it’s a buzzkill.
Appointments denote a task. Shopping is often times a spontaneous activity, whether on vacation or just a general need for “retail therapy”. It’s the thrill of finding something new and when you have to make appointments you limit the flow of a day, and create a sense of being rushed, checking activities off a list. There is a time and place for appointment shopping, but it definitely shouldn’t be the only way to access a store.
Call it what it is. Appointment-only shopping is the last step before shuttering the entire store. No one needs—or can financially support—that much floor space for 1:1 interactions.
In-store personal shoppers are by appointment. Beyond that, Saks’s only advantage is that it can lay off most of its staff.
The biggest loss may be from tourists with big bucks. Saks Fifth Avenue Flagship is surely a tourist destination. Imagine, as a tourist, you are walking down the Avenue and step up to Saks, “I’m sorry. You don’t have an appointment.”
I agree with Neil that this move by Saks is more about their San Francisco location. Appointment shopping for select customers has been the norm at luxury department stores for years. Most offer their high spending shoppers the equivalent of a platinum level card with perks such as free gift wrapping, special member previews including sales and bonus rewards. Shoppers who qualify typically make appointments with their personal shopper. During the pandemic we saw a rise in appointment shopping across a range of stores. But this can only be sustained for the very uber luxe boutiques. In it’s current format, Saks stores are too large to limit traffic. Maybe they will rebrand this particular location ” The Fifth Avenue Club” to align with their personal shopping program.
I’m intrigued to see how this initiative is embraced by higher-end shoppers. The concept of a special appointment-based experience should be a compelling idea provided that the approach is supported with the availability of product specialists and an experience level that is differentiating from that which is available at other luxury retailers. As a practical matter, such an approach should provide Saks with the opportunity to position staffing to fit the demand for such services more efficiently, one would think. It will be exciting to see how this unfolds…
This modus operandi may be necessitated by safety concerns in specific stores. To require an appointment for everyone walking into a store is too restrictive for the customer and may result in less foot traffic and consequently fewer sales and more quiet resentment.
It seems like the article tries really hard to make it sound like Sak’s would be implementing this appointment-only strategy even if it weren’t for the crime problem and the impending merger with Neiman Marcus across the street. I reeeeaaaallly doubt that’s the case. A tourniquet on a hemorrhage is a temporary solution. Long term solution to be determined. Hey, San Francisco, any thoughts?
While appointments help luxury retailers offer attentive, personalized pampering and collect upscale shoppers’ data, it creates a barrier to spontaneous, walk-in customers.
By moving to an appointment-only model at their San Francisco location, Saks Fifth Avenue is taking a very misguided approach to help mitigate the levels of crime and mismanagement at this once strategically positioned store. It’s very unfortunate to see the continued deterioration of the Saks Fifth Avenue brand, which was once at the pinnacle of the intersection of luxury and department stores.
With the potential Neiman Marcus acquisition and establishing the Saks Global operating model to support all the banners, you have to wonder what will happen with the San Francisco store location and the overall go-to-market strategies with Saks. Moving to an appointment-only model is yet another questionable move by the Saks leadership team, and it’s not one made in a position of authority and strength.
While an appointment-only model is very effective with boutiques and niche luxury stores, the company is setting the San Francisco store up for failure. It will become a sales deterrent, as consumers will go to other stores that aren’t so restrictive.
I know this model has work for smaller luxury, boutique retailers, but I wonder how you can turn a large department store into an appointment only
shopping experience. I understand why they are doing it, but I would have to understand the numbers at a higher level to know if this is a good decision or not.
This is a last ditch effort by Saks to maintain SF business in an area of the country that is almost like the wild west. Said differently my view is crime is what is driving this, with personalized shopping experiences as the cover. It may help with the wealthiest consumers (who can argue with having a store to yourself?) however we should put a star on the calendar and watch how long this store stays open.
I feel for the surplussed associates-this is almost all on Mayor Breed and Gov. Newsome.
Having co-run a boutique for luxury kids fashion for a while, I can say that the appointment-only model definitely works for some clients in some scenarios. HOWEVER, I would never shut an entire department store to the public.
I agree that SAKS probably did it because it’s the only option they currently see.
If they were in a stronger position, I would argue they should offer both … by only making one floor „by appointment only“, like in hotels.
Perhaps this is a fate-accompli ? Perhaps they will move to appointment only and in 1 year we will hear that “This unfortunately is not working and Saks Global has decided to leave this location” .Maybe thay can not close the store at this time in relation to rental agreements, or pre arranged agreements with the city, if they own the building? They certainly will NOT need a 6 floor store going forward!
Most of the comments are that this only works with luxury or niche companies, but I would argue that Apple stores have mainstreamed appointment-based shopping. While I have no numbers to share, I’d venture to guess that a vast majority of their sales come from customers with appointments, not those just popping in.
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First, let’s be clear why Saks is implementing this in San Francisco. Moving to by appointment only is not some kind of superior business model, it is a response to both the fact the store isn’t working financially and soaring crime rates. The shift comes from a position of weakness, not of strength. Saks may eventually close the store, especially if the merger with Neiman Marcus goes through. More widely, appointment-based shopping may work for uber-luxury brands or in very niche locations. It will not work for larger stores or more mainstream luxury where passing trade, including from tourists and visitors, remains an important part of the sales mix.
Definitely a move from a position of weakness
Hopefully, this is a placeholder until the Neiman’s merger completes. It’s not a sustainable model for a flagship store in a location that heavily relies on spontaneous tourist traffic. That’s not to say that appointment-based retail isn’t viable for small-scale uber-luxury brands. However, regardless of size, Saks doesn’t qualify as a member of the rarified fashion club.
Finally!(I’ll take my referral fee in cash, no store credit please) Speculation is rife here in the
cityCity as to the cause, with shrinkage and merger – the store is cross the square from likely-soon-to-be-stepstore Neiman Marcus – battling it out; but there’s no disagreement with the reaction: the idea is universally disliked. And it seems like a folly: we’re not talking about some resort shop or a designer boutique here, it’s a ~150Kgsf 6 story downtown store…this is more like a plot from the Twilight Zone than an intelligent marketing decision.Desperate measures for desperate times comes to mind. Appointment only is not a model that is going to scale well. However, it is a model that may work well in 10-15 locations across the country as part of a larger set of full service stores. it may be the most economical in these few locations but it is not going to work in all locations. It will alos need to have a much different inventory allocation and a very strong set of Omni tools.
While there is a place for appointment-shopping, this isn’t it. Saks Fifth Avenue will see a drastic reduction in store visits and ultimately sales as a result of this move, and it will impact Union Square as a shopping destination. The luxury appointment shopper may get better service, but Saks is trading that off against all incidental and aspirational shoppers and the revenue these store visits generate. Instead of appointment-only, these luxury retailers should be thinking, ‘appointment AND causal shopping’.
Prevent retailing at its finest
Combine it with Amazon just-walk-out technology & you’d achieve the ultimate: a store with no customers or employees.
Let’s be realistic, this has all the appearance of being motivated exclusively to combat theft. Appointment-based retail worked for stores that were forced to close during the pandemic – when there was no other option. For sure luxury brands and some highly specialized product purchases (think of buying complex photography or video recording gear where you might want a consult to help you choose what to buy) this can work, But for an entire department store the size of a Saks flagship? For all customers and all purchases? I don’t see this lasting long-term. Again, for a small boutique, sure, it will work. When consumers want that consultative expertise to guide them on their shopping journey, yes, but for general spontaneous shopping this is more of a hindrance and just adds friction.
Some of the lines to get into luxe stores like Louis Vuitton etc are so long … maybe more by-appointment-only shops can improve the experience, though I don’t think it will do do for Saks
While I understand the financial realities and crime concerns for this location I see it as an unfortunate turn of events. Appointment shopping is absolutely part of the luxury mix but so is the in store experience with the ability to browse, engage and be inspired. You certainly don’t need that much space to serve appointment only customers. I am curious to see how things evolve in this location.
For destination shoppers seeking a particular dress, jacket, or suit, Saks Fifth Avenue’s “by appointment only” service is an invaluable service. An ideal shopping experience is provided by personalized advice, assistance, and service.
Customers receive one-on-one attention from experienced experts who understand their unique preferences and needs. This approach helps shoppers discover the ideal item, all while having a more relaxed and pleasurable experience. Moreover, it saves time because qualified employees can swiftly pinpoint appropriate choices, rendering the shopping excursion efficient and devoid of stress.
Customers who use this service can bypass long lines in busy departments, queues at checkout counters, and delays for dressing rooms.
A relaxed and tailored shopping experience makes customers feel valued and catered to, enhancing their satisfaction. Their personalized attention helps them find exactly what they need without the stress of navigating crowded stores. Additionally, the service is efficient, which provides a more enjoyable shopping experience.
In contrast, the non-destination shopper who browses the store at leisure doesn’t want a walking shadow following them around.
Appointments are ideal in certain circumstances, however, they may not be appropriate in all circumstances and situations. Appointments should only be scheduled by consumer choice.
While scheduled appointments offer personalized service and efficiency, allowing customers to find exactly what they need without the stress of crowded stores, spontaneous shopping provides the freedom to explore at one’s own pace.
Those who enjoy browsing and discovering new items without a structured plan can find joy in the spontaneity and flexibility of unscheduled visits. Ultimately, the choice between a scheduled appointment and spontaneous shopping depends on individual preferences and the specific shopping experience one seeks. -Db
Should luxury retail be by appointment only? Absolutely not, who’s got time for that?
Shoplifting is so out of control in San Francisco this seems like a last resort. I get it, it’s survival. But when I think of centers like The Forum Shops at Caesars in Las Vegas, where every other store is high end luxury retail, it’s ridiculous. Or as the tourist from Switzerland said in the article, it’s a buzzkill.
Appointments denote a task. Shopping is often times a spontaneous activity, whether on vacation or just a general need for “retail therapy”. It’s the thrill of finding something new and when you have to make appointments you limit the flow of a day, and create a sense of being rushed, checking activities off a list. There is a time and place for appointment shopping, but it definitely shouldn’t be the only way to access a store.
Call it what it is. Appointment-only shopping is the last step before shuttering the entire store. No one needs—or can financially support—that much floor space for 1:1 interactions.
In-store personal shoppers are by appointment. Beyond that, Saks’s only advantage is that it can lay off most of its staff.
The biggest loss may be from tourists with big bucks. Saks Fifth Avenue Flagship is surely a tourist destination. Imagine, as a tourist, you are walking down the Avenue and step up to Saks, “I’m sorry. You don’t have an appointment.”
I agree with Neil that this move by Saks is more about their San Francisco location. Appointment shopping for select customers has been the norm at luxury department stores for years. Most offer their high spending shoppers the equivalent of a platinum level card with perks such as free gift wrapping, special member previews including sales and bonus rewards. Shoppers who qualify typically make appointments with their personal shopper. During the pandemic we saw a rise in appointment shopping across a range of stores. But this can only be sustained for the very uber luxe boutiques. In it’s current format, Saks stores are too large to limit traffic. Maybe they will rebrand this particular location ” The Fifth Avenue Club” to align with their personal shopping program.
I’m intrigued to see how this initiative is embraced by higher-end shoppers. The concept of a special appointment-based experience should be a compelling idea provided that the approach is supported with the availability of product specialists and an experience level that is differentiating from that which is available at other luxury retailers. As a practical matter, such an approach should provide Saks with the opportunity to position staffing to fit the demand for such services more efficiently, one would think. It will be exciting to see how this unfolds…
This modus operandi may be necessitated by safety concerns in specific stores. To require an appointment for everyone walking into a store is too restrictive for the customer and may result in less foot traffic and consequently fewer sales and more quiet resentment.
It seems like the article tries really hard to make it sound like Sak’s would be implementing this appointment-only strategy even if it weren’t for the crime problem and the impending merger with Neiman Marcus across the street. I reeeeaaaallly doubt that’s the case. A tourniquet on a hemorrhage is a temporary solution. Long term solution to be determined. Hey, San Francisco, any thoughts?
While appointments help luxury retailers offer attentive, personalized pampering and collect upscale shoppers’ data, it creates a barrier to spontaneous, walk-in customers.
By moving to an appointment-only model at their San Francisco location, Saks Fifth Avenue is taking a very misguided approach to help mitigate the levels of crime and mismanagement at this once strategically positioned store. It’s very unfortunate to see the continued deterioration of the Saks Fifth Avenue brand, which was once at the pinnacle of the intersection of luxury and department stores.
With the potential Neiman Marcus acquisition and establishing the Saks Global operating model to support all the banners, you have to wonder what will happen with the San Francisco store location and the overall go-to-market strategies with Saks. Moving to an appointment-only model is yet another questionable move by the Saks leadership team, and it’s not one made in a position of authority and strength.
While an appointment-only model is very effective with boutiques and niche luxury stores, the company is setting the San Francisco store up for failure. It will become a sales deterrent, as consumers will go to other stores that aren’t so restrictive.
I know this model has work for smaller luxury, boutique retailers, but I wonder how you can turn a large department store into an appointment only
shopping experience. I understand why they are doing it, but I would have to understand the numbers at a higher level to know if this is a good decision or not.
This is a last ditch effort by Saks to maintain SF business in an area of the country that is almost like the wild west. Said differently my view is crime is what is driving this, with personalized shopping experiences as the cover. It may help with the wealthiest consumers (who can argue with having a store to yourself?) however we should put a star on the calendar and watch how long this store stays open.
I feel for the surplussed associates-this is almost all on Mayor Breed and Gov. Newsome.
Having co-run a boutique for luxury kids fashion for a while, I can say that the appointment-only model definitely works for some clients in some scenarios. HOWEVER, I would never shut an entire department store to the public.
I agree that SAKS probably did it because it’s the only option they currently see.
If they were in a stronger position, I would argue they should offer both … by only making one floor „by appointment only“, like in hotels.
Perhaps this is a fate-accompli ? Perhaps they will move to appointment only and in 1 year we will hear that “This unfortunately is not working and Saks Global has decided to leave this location” .Maybe thay can not close the store at this time in relation to rental agreements, or pre arranged agreements with the city, if they own the building? They certainly will NOT need a 6 floor store going forward!
Most of the comments are that this only works with luxury or niche companies, but I would argue that Apple stores have mainstreamed appointment-based shopping. While I have no numbers to share, I’d venture to guess that a vast majority of their sales come from customers with appointments, not those just popping in.