Tommy Hilfiger joins Calvin Klein, Lord & Taylor, and Gap in closing a major flagship store in New York

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

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.