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Hudson’s Bay stores, e-commerce separating to create two businesses

Hudson’s Bay Co. is once again putting a line in the sand between brick-and-mortar and online.

The company plans to separate its Hudson’s Bay store fleet and e-commerce business into two separate businesses with dedicated leadership teams. HBC made a similar move in March, when it announced plans to split its Saks Fifth Avenue business, separating the luxury department store retailer’s e-commerce business and stores into two separate entities. It recently announced a similar move for Saks Off 5th.

[Read More: Another big split for Saks — this time for off-price business]

Under the new model, Hudson’s Bay’s 86-store fleet will operate as Hudson’s Bay. The retailer’s e-commerce entity will operate as The Bay, and be responsible for brand direction, marketing, buying, planning and technology for both businesses. 

Iain Nairn will lead the e-commerce business as president and CEO. Wayne Drummond, Hudson’s Bay’s chief merchant, was named president of the stores business.

The decision to separate Hudson’s Bay’s businesses follows the company’s April launch of an online third-party sales platform, called Marketplace, on its e-commerce site. To date, the site has introduced more than 1,500 new or expanded brands and more than 25,000 new products through the new platform. It is currently the 6th largest e-commerce business in Canada.

“Establishing e-commerce and stores as distinct businesses is a pivotal next step in the future of Hudson’s Bay,” said HBC governor, executive chairman and CEO Richard Baker. “With the launch of Marketplace on earlier this year, Hudson's Bay set in motion a rapid expansion of its e-commerce business to gain significant market share and become the country’s largest premium hybrid online shopping experience. This move enables each team to make unencumbered strategic investments into their respective businesses to deliver an incomparable customer experience for Canadians.”

[Read More: Hudson’s Bay creates Canadian challenge to Amazon, Walmart, eBay]

The two businesses will work closely together to deliver a seamless customer experience while making strategic investments in their respective growth plans, according to HBC. Returns, exchanges, Hudson’s Bay Rewards and Hudson’s Bay credit cards will continue to be accepted both online and in stores.

“The digital-first transformation of The Bay takes us to the next level, with significant focus on technology investment and innovation — including the creation of technology hubs in both Toronto and Seattle, increased fulfillment capabilities, expanded marketing and extended vendor partnerships for a highly-curated assortment,” said Bay CEO Nairn.

“Hudson’s Bay stores will play a critical role to the overall shopping experience and brand promise to customers,” stated Drummond, president of Hudson’s Bay. “As we evolve and adapt, the role of stores has never been more important or vital to the collective success of our businesses. Hudson’s Bay stores will become discovery destinations and serve as an important touchpoint for customers.”

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