Neiman Marcus CEO blasted over ‘snobbish’ snub of less-wealthy consumers

Neiman Marcus CEO blasted over 'snobbish' snub of less-wealthy shoppers

Neiman Marcus’ chief govt is going through an worker backlash after he mentioned the luxurious chain plans to focus extra solely on its wealthiest shoppers — a “snobbish” pivot that some gross sales staffers concern will alienate consumers.

In an interview with Fortune last week, CEO Geoffroy van Raemdonck famous {that a} tiny, 2% sliver of the corporate’s buyer base accounts for a whopping 40% of its enterprise. Accordingly, Neiman plans to work more durable courting these well-heeled consumers — and spend much less time on the remaining, he mentioned.

“Many purchasers store at Neiman Marcus 25 occasions a 12 months and spend $27,000,” van Raemdonck mentioned. “I see far more danger in having a one-time transaction the place I don’t know if you’ll ever come again.”

The luxurious division retailer’s prime gross sales reps had been horrified. Certainly, one who requested to not be recognized mentioned a buyer who has spent $5,000 at Neiman Marcus over the previous 12 months talked about van Raemdonck’s interview over the weekend and “felt personally insulted.”

“I’m scrambling now,” the rep mentioned.

Geoffroy van Raemdonck, flanked by Anna Wintour and Karen Katz.
Geoffroy van Raemdonck flanked by Anna Wintour and former Bergdorf Goodman govt Linda Fargo.
Neil Rasmus/BFA/REX/Shutterstock

“What in regards to the future millionaires?” the gross sales rep added. “We work so onerous to create a welcoming tradition at our retailer for everybody and now now we have our CEO excluding some that are available in. He’s truly hurting us and our future.”

Van Raemdonck mentioned that the Dallas-based division retailer is not going to promote “in every single place on the worth spectrum, from clearance to high-end jewellery,” arguing that specializing in essentially the most prosperous prospects avoids the “churn and the worth is not the principle consideration.”

One of many hallmarks of van Raemdonck’s five-year tenure at Neiman Marcus is his determination to shut the corporate’s 22 Final Name low cost shops in 2020 — although a handful of shops are nonetheless open.

Clothing racks with discounted merchandise.
Neiman Marcus made the choice in 2020 to close down its low cost chain, Final Name.
Getty Pictures

“We seemed on the numbers and couldn’t see prospects who shopped at Final Name after which grew to become Neiman Marcus prospects,” van Raemdonck advised Fortune.

The air of exclusivity was an excessive amount of for the corporate’s personal workers.

“Many people who promote are extraordinarily upset,” a veteran retailer gross sales rep advised The Submit. “Not all of our shoppers spend $27,000 they usually aren’t millionaires. Why would he say this and alienate a few of our prospects — and with such a snobbish tone.”

The rep added, “They is probably not essential to him however they’re to us. We’ve got private relationships with all kinds. And we work on fee.”

Neiman Marcus didn’t instantly reply to requests for remark.