What things I must to bare in mind when it comes my flagship take-off?
1. What does the word flagship mean? When did flagship stores born?
Flagship in nautical refers to the vessel that heads a squad. However, in the commercial sector this term has a metaphorical meaning that means: "model store". Therefore, it is not just another shopping mall and should not be confused with them.
The flagship stores, born in the States in the nineties of the twentieth century and became globalized from 2000. However, it is by no means impossible to suppose that their appearance was linked to the 'glorious thirty. Namely the period of almost uninterrupted growth in capitalist economies between 1945-73. In this context of growing consumption a brand might have taken advantage of the opportunity to link itself to an emblematic establishment.
2. Is it always advisable to go for a flagship store?
No. For at least three reasons:
- A practical one: a company must earn more than it spends. As 'flagship stores' are very expensive, a low profit is not enough and we strongly advise against putting them when your business have loses because then you need to sell at all costs and, as we will see below, this type of store does not seek to sell as a one objective.
- Another ideological one: if there is no "brand image" built, consolidated and with prestige, there is no point in having a "model store". Of course, making an effort to "build a brand" is worthwhile, we don't want todiscourage anyone!. In fact Finques Feliu know from experience what is to build a brand, it requires: conviction, constant work and extreme coherence with the firm values.
- A fait accompli: the 'flagship' is identified only with the 'retail' sector it is not used for wholesale. On the other hand, they do represent a round bet for a major brand with worldwide prestige. Thus, in the photos that illustrate the news you can see those of Asics and Apple in Barcelona.
3. We know each other as an organization and we have a consolidated brand. We want a "model store": What are its objectives, what will it bring us, and what does it cost?
We love that our community of readers is so intrepid! By now it has become clear that to talk about a flagship store is to talk about a company's strategic commitment, therefore, all our departments must be "aligned" for the initiative to be a success.
At first glance, seems a paradox but a "flagship store" does not have sales as its primary objective. To unravel this apparent contradiction, let us consider the example of "Apple": in 2021, in Spain, it sold 347 million euros (an amount equivalent to more than 10% Andorra's GDP in 2021). It is obvious this benefits, the pressure of sell in the flagship is smaller. So, what the brand looks for when betting on a flagship store is to combine three very desirable "intangibles":
- Projecting strength: Inditex in 2017, according to the economic newspaper Elconfidencial invested 600 million euros in 424 stores around the world, that is, a unit investment of 1.42 million.
- To win prestige: placing our 'flagship' on the most important avenue of the city shows power as implicitly -with almost nothing said it is there- as explicitly -once installed it is seen-.
- Attract notoriety: this will be given to us by the customer. Today, in the age of multichannel communication, it is increasingly important what the customer feels in the store and, consequently, what he communicates with his review or through his networks.
In "model stores", a multi-sensory experience is given, which especially involves a feeling of "status". Let's think about it from the customer's point of view: "I was able to be in model store x and I was impressed". Thanks to this, the impact of the brand will multiply and translate in the future into very tangible gains.
Let's hope we've answered all your questions!