Saturday, September 26, 2020

Department stores are betting on booze to boost retail

Jan 26. 2020
Martini at the Goodman's Bar in the Bergdorf Goodman department store in Manhattan.. MUST CREDIT: Bloomberg photo by Kate Krader.
Martini at the Goodman's Bar in the Bergdorf Goodman department store in Manhattan.. MUST CREDIT: Bloomberg photo by Kate Krader.
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By Syndication Washington Post, Bloomberg · Kate Krader, Kim Bhasin · BUSINESS, RETAIL 

On a recent mid-January afternoon, the eight seats at the Shoe Bar in Nordstrom's new women's store were empty. "It's Dry January. People are broke," a bartender observed.

And yet, within a half-hour, most of the stools had filled up. "There's a bar here!" a woman said happily. She ordered the gin-based signature cocktail called Husband Daycare and showed off a pair of gloves she'd bought upstairs. She planned to do more shopping after she finished.

"A round of drinks is a second pair of shoes," says David Bruno, a former buyer for Bergdorf Goodman and now a consultant on the elegant new Goodman's Bar, tucked into the second floor of the men's store a few blocks east of Nordstrom. "A bar means people are spending more time within your walls. The more time they spend and the more loose they are, the easier the sale on everyone's side."

Goodman's Bar, which opened in early January, is the newest in a growing number of watering holes inside Manhattan's higher-end department stores. Nordstrom introduced its Shoe Bar and Broadway Bar when its women's store opened in late October. Across the street, the men's store has a café with a similarly strong bar program. Saks Fifth Avenue, which underwent a $250 million renovation in 2019, is home to the Alpine-themed drinks lounge Le Chalet. Across town, inside Hudson Yards, Neiman Marcus has Bar Stanley, which features its own ambitious cocktails.

Destination dining inside luxury department stores is nothing new. Freds has been bringing ladies who lunch and shop into Barneys New York since it opened in 1996. More recently, Tiffany & Co. introduced the Blue Box Cafe, a made-for-social-media stop with robin's-egg blue upholstered seats and a towering tea service that had hourslong waits. But as Barneys prepares to shutter, and the Blue Box Cafe is closed for two years during Tiffany's renovation, there's a previously untapped form of refreshment for sustenance-seeking shoppers in Midtown: cocktails.

An in-store bar has several benefits. Besides the potential for additional purchases and the opportunity to keep shoppers inside a store, alcohol has high margins. Plus, the locations naturally attract customers, said Sucharita Kodali, a retail analyst at Forrester Research. Unlike their suburban counterparts, urban department stores draw a combination of domestic and international tourists, as well as the after-work commuter crowd from Wall Street through Madison Avenue.

"The advantage that these bars can have is that they're in flagship locations," Kodali said. "There's already a lot of traffic, and they're in department stores that are thriving." Likewise, stores are now more willing to devote in-house real estate that might have once been reserved for clothing and accessory displays to an area that can serve cocktails. 

Nordstrom's Shoe Bar is straight out of Sex and the City: a curved, stone-topped bar in the thick of the Ted Baker and Jeffrey Campbell display shoes. Thirsty shoppers can order an old-fashioned or signature drinks such as the bourbon-based Billionaire off the menu. Coffee drinks and snacks are available, too.

A lot of the drinking at Shoe Bar takes place among the velvet sofas, where customers try on, say, a pair of Freda Salvador combat boots. And the bartenders stay busy. Vincent Rossetti, vice president for restaurant operations at Nordstrom, said that one in every four transactions at Nordstrom is food or drinks. The Shoe Bar alone sold more than 400 drinks on the Saturday before Christmas. 

Down a curved staircase from L'Avenue on the top floor of Saks is Le Chalet. The Philippe Starck-designed bar evokes an Austrian après-ski palace and has a cocktail program that includes unconventional choices such as Baby It's Cold Outside-gin, Campari, sweet vermouth, and coffee. Hidden farther away from the clothing racks and handbag shelves than its kin at other department stores, it serves more as a hideaway from the bustling city than a shop-till-you-drop pit stop.

Goodman's Bar sits in an alcove on Bergdorf's second floor. The art deco space, from the store's in-house design team, has Tom Dixon wingback chairs, custom backgammon tables, and a bar-to-ceiling mural of Central Park. The beverage program is the most ambitious in a Manhattan store, overseen by master sommelier Dustin Wilson. "It's no longer enough to put out a shingle and open up a bar," says Bergdorf's men's fashion director, Bruce Pask. "It has to be a destination." 

On Goodman's menu, alongside the gougères and truffled tagliatelle from chef Austin Johnson, is a short, curated list of wines almost all available by the glass. The bestselling drinks are the grower's Champagne Dhondt-Grellet and old-fashioneds, which aren't even on the menu. (The $22 Goodman's Manhattan also sells well.)

Bergdorf's is also working on an app that allows customers to order drinks while they peruse Kiton on the second floor. "You're getting fitted for an evening jacket and have a hankering for an old-fashioned-we trust that our customers can manage both," Pask said. Nordstrom has even given customers the option to order chicken tacos and martinis while shopping, but Pask doesn't anticipate delivering food to shoppers at Bergdorf's. "We'll keep the gougères and silk ties away from each other," he says.

Across town, one of the most crowded spots at the three-floor Neiman Marcus is Bar Stanley. On a Friday night before Christmas, all the seats at the bar were filled; the store, not so much. "This feels like the busiest place here," said a customer, glancing around.

The leather apron-clad bartender responded, "We get that a lot."

 

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