It used to be considered the retailer's crown jewel—a large format store on a swank corridor that showed off the best of what a brand had to offer. But now the so-called flagship store is disappearing from high-profile shopping thoroughfares like Manhattan's Madison Avenue and Chicago's Magnificent Mile because of skyrocketing rents and the shift to online shopping, the AP reports. Over the last year or so, Gap, Tommy Hilfiger, Lord & Taylor, and Polo Ralph Lauren have closed their flagship stores on Manhattan's Fifth Avenue. Abercrombie announced in May that it was closing three more of its big locations around the world. Other retailers are reimagining the flagship concept instead of abandoning it altogether.
Nike, for instance, lets shoppers see details of items displayed on a mannequin by scanning the QR code and then having those items delivered to a fitting room or a designated pickup spot. Those still clinging to the old concept, however, are having a harder time—like Barneys New York, which is now looking at possible bankruptcy. The concept of a flagship store is more than a century old and used to be limited to retailers' biggest store. But in the last 20 years, a flagship store frenzy took hold and retailers from Gap to H&M looked at them as a must-have shrine to their brands, opening multiple flagships in multiple locations, including luxury corridors. Rents have swelled so much, however, that many retailers can no longer justify the high price, especially as more shoppers shift their spending online and physical stores lose foot traffic.
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