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Tommy Hilfiger's flagship store in New York.
- Tommy Hilfiger is closing its New York Fifth Avenue global flagship store.
- It joins a list of retailers including Calvin Klein and Lord & Taylor that have recently closed flagship stores in New York.
- The flagship store as we know it is changing. Experts say that large flagship stores that do not offer exciting and engaging experiences are no longer effective marketing tools for brands.
Tommy Hilfiger is the latest brand to give up on Fifth Avenue.
News broke Monday that the retailer would be closing its global flagship store in New York. A spokesperson for Tommy Hilfiger did not immediately respond to Business Insider's request for comment or confirm when this location would close.
"In line with our strategic objective to further reach and engage with digitally savvy North American consumers, we will focus on next generation
Grieder also said that the retailer would be closing its Tommy Hilfiger store on Collins Avenue in Miami at the end of next month.
"Leveraging our store-of-the-future concepts rolled out in the global retail landscape, going forward North America will be the lighthouse region to develop and test new modular, digitally infused retail concepts," he said.
"We continue to invest in tommy.com and the ongoing expansion of strong wholesale distribution partners that keep consumers at the heart of our brand."
Tommy Hilfiger joins retailers including Gap, Lord & Taylor, and Ralph Lauren that have also closed flagship stores in New York in recent months. Calvin Klein, which is owned by the same parent company as Tommy Hilfiger, also plans to close its nearby Madison Avenue flagship store this spring.
A way to tell the story of a brand
Traditionally, the flagship store has been a way to promote a brand's image and tell its story, more about marketing and branding rather than sales.
But increasingly the flagship has become a less relevant - yet still costly - marketing tool due to changes in consumer shopping habits.
"New generations of consumers do a lot of product discovery online or via social media. This means expensive flagships are less relevant than they once were," Neil Saunders, managing director of GlobalData Retail, wrote in an email to Business Insider in February.
"A brand like Gap has no real business having a flagship as it is just a large version of mundanity that doesn't really pay for itself," he said.
Flagship stores that are simply larger versions of standard stores are unlikely to have a place in the future of retail.
Read more: The flagship store of the future will be nothing like the industry has seen before
"It only makes sense if you create an experience," Corey Pierson, CEO and founder of Custora, a customer analytics platform for the retail industry, told Business Insider last month.
Pierson said flagship stores need something extra to make it relevant, "a different or unique experience that strikes a chord."
Things are changing
Digitally native retailers such as Bonobos, Glossier, Everlane, and Casper are paving the way with innovative new store concepts. These brands have the luxury of making a fresh entrance into brick-and-mortar retail and are able to trial new concepts. Given that their flagship may be their only store in a city, these retailers can focus on putting their best foot forward here - exactly what a flagship should do.
Innovation hasn't been reserved to smaller digital brands, however. Longtime industry players such as Nike and Nordstrom are also figuring out how to make their flagship stores relevant and appealing.
Business Insider/Jessica Tyler
Nike's new flagship store.
Last year, Nordstrom opened its new men's-only flagship store in New York. This micro-department store offers in-house tailoring and shoe-shining services, and it has a restaurant and bar. This fall, a women's-only version will open across the road.
At the time of the men's store's opening, late Nordstrom co-president Blake Nordstrom told Business Insider that the company had been scouting out a location in Manhattan for the past 20 years; it was by no means a spontaneous decision. And, despite the industry pressures currently facing department stores, the company still saw value in opening a location in a prime area of Manhattan.
Nike also opened a massive new flagship store in New York at the end of 2018. Housed in a sprawling, 68,000-square-foot space that spans six floors, this store has the largest collection of Nike shoes for sale in the world and highly innovative technology that offers in-store experiences like instant purchases for app users.
