The rapidly expanding Hudson’s Bay Co. has launched a group charged with overseeing how the retail chains now under its corporate umbrella approach all things digital. Michael Burgess, the former president of Saks Direct, will lead the new HBC Digital division as president, reporting directly to Hudson’s Bay Co. chairman and CEO Richard Baker.
The new group will oversee digital strategy across all sales channels, including web, store and mobile. “Digital is transforming retail today,” Burgess says. “It is not just e-commerce, it is [also] mobile and it is stores. It is [about] going online to offline and back to online that we know consumers today want and are doing, and it is really about leveraging digital across all those customer journeys and bringing our scale to all of that.”
The Toronto-based Hudson’s Bay Co. acquired Saks Inc. in an all-cash transaction worth $2.9 billion last year. With the acquisition came Saks Direct, the e-commerce unit of Saks Inc., which generated an estimated $899.0 million in web sales in 2012, up 20.1% from $748.6 million in 2011, according to the Top 500 Guide, where Saks ranks No. 37. In 2012, Hudson’s Bay generated $142.3 million in web sales primarily from e-commerce sites TheBay.com and LordandTaylor.com, up 69.8% from $83.8 million in 2011, according to the Top 500 Guide.com, where Hudson’s Bay ranks No. 158.
Burgess joined Saks Direct as president in May 2012. He was executive vice president of the consumer division of floral service FTD Group Inc. from 2008 to 2012. FTD is No. 85 in the Top 500 Guide.
The companies Hudson’s Bay owns operate 321 stores, including 179 full-line department stores, 73 outlet stores and 69 home stores throughout the United States and Canada, along with three e-commerce sites. Hudson’s Bay has announced plans to open at least two Saks Fifth Avenue stores in Toronto, the first Saks stores in Canada. The first, a 150,000-square-foot store in downtown Toronto, is slated to open in fall 2015.
Burgess says he and his team will be figuring out how digitized that store will be, and that he’ll be working closely with Marigay McKee, president of Saks Fifth Avenue, to find the right mix for the store and other Saks stores. McKee joined Saks in January from the Harrod’s department store chain in the United Kingdom, where she was chief merchant. “We all believe in the importance of the digital experience in store, and we are still in the process in making plans on how it will evolve.” Harrod’s Ltd. is No. 359 in the Europe 500.
One change Burgess and his team are looking at is consolidating the technologies used to run the e-commerce sites now owned and operated by Hudson’s Bay. He says Saks.com, TheBay.com and LordandTaylor.com will maintain their separate identities on the web, however it would make more sense to run them from a common platform. “I think we are going to create a common technology platform that can be leveraged for each retail banner,” he says. “Which platform is still to be determined.” Saks Direct operates on a platform from RedPrairie, a unit of JDA Software Group Inc., and Hudson’s Bay sites operate on a platform built in house, according to the Top500Guide.com.
Having one group overseeing all digital efforts is going to help Hudson’s Bay scale all its digital efforts, Burgess says. “Hudson’s Bay is putting together all the great digital talent [it has] into one organization so we can leverage that talent and resources and scale across all functional areas. That’ll [have us] running a really great e-commerce business and have digital across the entire customer experience, in stores and with mobile devices.”
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