Fashion icon Ralph Lauren is finding out the hard way that the retail landscape is changing and not necessarily in his favor.
In the age of e-commerce and discounts, it's becoming harder for brands overall to compete. Consumers seek deals and discounts and care less and less about brand loyalty.
Earlier this year, we reported the fashion brand's departure with its CEO, Stefan Larsson due to creative differences. The main purpose behind hiring Larsson was to help innovate by bringing more creativity to the table. Given Ralph Lauren's staunch attitude towards the traditional aesthetic of his brand, this new approach may have been too much of a push.
Recently, this move to let go Larsson may have come back to bite the apparel brand.
On Tuesday, Ralph Lauren announced its decision to close its 5th Avenue flagship store in New York City. Due to a decline in sales, the retail brand is planning to lay off some of its staff and pushing for a $370 million restructure to focus more on e-commerce.
As of April 15th this year, the iconic 5th Avenue location will be no more.
Many retailers on the famous luxurious city street have had to make adjustments due to a decrease foot traffic, online discounts and higher rent prices.
To help push forward on the e-commerce front, Ralph Lauren is moving its e-commerce framework to Salesforce's Commerce Cloud. In addition to this new focus, the retailer is also planning to close additional stores. Overall, the company is looking to save $140 million in these actions by the end of the next fiscal year.
With more retailers consolidating their locations and moving in a similar e-commerce direction, this further puts into question the survival of brick-and-mortar in a digital world. Over the next few years, there's likely to be more experimentation by retailers to find the best balance for keeping people engaged online and in-store.