Neiman Marcus Group CEO Geoffroy van Raemdonck talks trends in the business, good and not so good, and maintains confidence in the path he’s been taking NMG on for more than five years.
Group’s topline turned negative last quarter but the luxury retailer continued to gain ground on its long-term transformation strategy.
Inventories were “relatively flat” for fiscal 2023, compared to a year ago, or slightly down when adjusting for earlier fall receipts. Van Raemdonck also said that the company in its last fiscal year put less emphasis on the segments that were more promotional, and that business was softest with aspirational customers, those inclined to shop the products priced at the lower end of the price spectrum at Neiman’s.He also said that during the year, Neiman’s added 800 points of distribution with designers. A designer adding footwear to a single Neiman’s store would count as a point of distribution.
Van Raemdonck observed that business started softening in the second half of October 2022. “From then onward, the number is stable. What happened was the more aspirational customer suffered more, and we gained more with the best customers,” shopping higher-priced products. “So the net-net was a double-digit gain, compared to 2019.
According to van Raemdonck, 2 percent of Neiman’s customers drive about 40 percent of the volume, and there’s a 90 percent retention rate among top customers — those that spend more than $25,000 annually. Van Raemdonck said NMG has “between 50,000 and under 100,000” top spending customers, without being specific.With the luxury transformation, merchants have strengthened their focus on “buying for the audience that engages the most with us.
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