This article analyzes the luxury retail market in Canada in its new ultra-competitive landscape.

Getting Started

Appropriate Subject Area(s):

  • Entrepreneurship, business management, retail management, marketing

Key Questions to Explore:

  • What strategies can be used to address the challenging and competitive landscape of the retail luxury market?
Study and Discussion Activity

Introduction to lesson and task:

This lesson identifies the challenges facing the luxury retail market as Saks arrives in Canada. It points out that apparel retailers have been feeling the strains of currency fluctuations and rising competition from e-commerce and other sources, with several chains going under.

Action (lesson plan and task):

  • Ask the class to define the luxury retail market?
  • Brainstorm the names of some retailers in this space in your community.
  • Distribute the article for reading.
  • In groups of four, have students list the challenges facing this market.
  • Have them discuss the target market for this group of retailers. Is this market growing, static or declining?
  • Ask them what advice they can offer to address some of the challenges of this competitive landscape.
  • In the article, Nordstrom indicates that it had to lower prices because it was not familiar enough with local consumer demand. Have students discuss how they can become more familiar. What lessons should others learn from this?
  • Larry Rosen believes the strategies his company is using will ensure Saks does not have an impact. Have students speculate on what those strategies are and how these strategies can be transferred to other luxury retailers.

Consolidation Activity:

  • Have a class discussion on the lessons learned from the quick departure of Target from Canada and how these lessons might apply to the other end of the market.
Success and Additional Learning

 Success Criteria:

  •  Students understand differentiation in the retail space and what strategies can be used to address some of the challenges.

Confirming Activity:

  • Mr. Metrick of Saks stated that the “challenge is to ensure the customer feels that the money they are spending on the experience is worthwhile.”  What does this mean? What would make a customer feel this way?