[CMD UW]

Retail: Let Them Shop Chic
by Jeff Sanford, Canadian Business Magazine

When discount retailer Winners set up shop on Toronto's upscale Bloor Street West, some eyebrows were raised. But the buyers have spoken: cross-shopping is hot.

2005-12-26

When a Chapters bookstore gave up its lease at 110 Bloor St. W.--a prime bit of property along the upscale shopping district between Yonge Street and Avenue Road in Toronto--few guessed the new tenant would be popular mass-retailer Winners.

But it was. And the arrival of the "off-price" retailer on this exclusive stretch of real estate (Tiffany's is across the street) provoked an amusingly mixed reaction from local proprietors. "I can see them bringing in more traffic," the manager of a nearby Prada boutique, Kin Wong, was quoted as saying at the time. "[But] obviously, they're not our clients."

He's partly right. Many of Winners' clients are middle-class Canadians who appreciate the retailer's modestly appointed stores, where prices are generally 20% to 60% lower than anywhere else. But there is another Winners shopper, says Shannon Johnson, a spokesperson for the chain. She points out that it is often the same person who shops both at designer boutiques and at Winners. "The Winners shopper is someone who loves designer labels," says Johnson.

Welcome to retailing 2006, where the middle ground is giving way to a mixture of up- and downscale shopping. Consumers will pick up designer items along with discount lower-price goods, mixing a little cachet in with a lot of affordability. And Winners on Bloor is just one example of this. Consider groceries: a one-stop trip to Loblaws no longer cuts it. Instead, people head to organic food stores for a few quality items, and Costco for the low-cost bulk stuff.

"Twenty years ago peo-ple went down or up market. Now they cross-shop," says John Williams, a senior partner at J. C. Williams Group, a retailing consultancy. "We're seeing the popularization of high-end fashion districts. H&M and Gap are on 5th Avenue in Manhattan; [Winners] is on Bloor Street."

Perhaps this helps explain the ongoing struggles at Hudson's Bay Co., and Sears Canada Inc., two traditional department stores that represent the classic middle point of Canadian retailing. Neither are doing so hot in the revenue department; the trend to cross-shopping might be part of the reason why. After all, a trip to Sears won't guarantee cachet, but will pack a substantial bill for the everyday stuff (as compared to Winners' deep discounts).

Torontonians have caught on to the new trend. A recent visit to Bloor Street's Winners revealed packed aisles, and a 20-minute wait for the change room. The people have spoken: they want their chic--for cheap.