Myer’s strategic moves suggest the future of retail is consolidation and loyalty

Myer’s acquisition of Premier Investments’ Apparel Brands appears to be the next step in Olivia Wirth’s plan for the department store’s loyalty program, Myer One.

“This is an opportunity to continue to grow it in a way that is a step change,” Wirth said about the impact of the acquisition on Myer One, which has 10.6 million members, at an investor briefing after the deal was announced.

While the headlines have largely focused on the number of stores and sales Myer will add to its business if the acquisition is approved, the biggest opportunity could lie in the loyalty space.

Where is Myer’s Wirth now

Many experts recognise Wirth’s strong background in loyalty as one of the department store’s greatest assets.

“Under Wirth, Myer has hopefully redefined its strategy, streamlining operations for a balanced omnichannel approach,” Nick Gray, the founder of I Got You Consultancy, told Inside Retail.

“Wirth’s leadership has focused on in-store enhancements, customer loyalty, and curated brand partnerships, helping Myer adapt to and anticipate market shifts,” she added. 

These areas of investment are destined to get stronger as Myer looks to expand its portfolio – Wirth believes the acquisition of Premier’s Apparel Brands will allow Myer to negotiate with landlords and suppliers more easily.

According to Gray, Wirth’s omnichannel vision under the Myer One loyalty program is ultimately Myer’s competitive edge, and with the addition of Premier’s Apparel Brands, that omnichannel network is only going to get bigger and stronger.

However, Gray did counter his praise of Wirth with a caveat, suggesting that there’s still room for Myer to explore more in-store curation to deepen brand experience and connection with their target market. In his view, successful brands are those that answer the customer’s question, or in other words, meet the customer’s demand. 

“If Myer is the answer, what’s the question? This needs to be very clear with a business like Myer so they don’t confuse customers about who they are and for,” Gray stated.

This conundrum posed by Gray may become even harder to decipher after Myer’s acquisition of Premier Investments apparel brands; Just Jeans, Portmans, Jay Jays, Dotti and Jacqui E.

The Premier of a new Myer 

If the deal is approved by board members and shareholders, Myer will have 17,300 staff across Australia and New Zealand – as well as an estimated $4 billion in annual sales and $250 million in earnings.

After years of “right-sizing” under former CEO John King,  Myer’s acquisition of Premier’s Apparel Brands would add 719 store locations to its portfolio and give it access to a greater suburban and regional demographic.

“Myer and Apparel Brands have highly complementary store footprints and customers who will benefit from an expanded omnichannel ecosystem that enables them to engage with the Group’s loved brands when and how they want,” said Wirth in a statement.

But it’s not all about size, Premier’s Apparel Brands’ omnichannel strategy and customer connection align with Myer’s approach to loyalty. 

“Premier’s Apparel Brands were successful by maintaining a pretty clear brand positioning, managing a streamlined portfolio well and keeping that aligned with consumer preferences – I think they embraced a strong omnichannel strategy overall,” shared Gray.

“I also think they did a great job with their strategic vision and disciplined leadership which enabled them to cultivate a solid consumer connection, balancing cognitive defaults (being the ‘go-to’) with emotional affinity,” he added.

If the deal with Premier goes through, Myer has the potential to emerge from a challenging period of transformation and change to be one of Australia’s leading retailers.

“Predicting Myer’s rise would have been challenging a few years ago, given the industry’s trajectory and Myer’s prior hurdles,” concluded Gray.

“Yet, their adaptability, continued consumer focus, and strategic acquisitions have positioned them as a resilient force in Australian fashion retail today. Hats off to Myer.”

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