In its second-largest acquisition, Amazon buys the company for $970 million.
The Montreal-based apparel chain will launch an e-commerce site for the U.S. and Canada.
As it continues to revise its lines of apparel, footwear and accessories to appeal to a wider range of customers, Le Chateau is betting that launching its first e-commerce site this fall will help bring more shoppers to its new look, the retailer says
“This is about getting our message out there to a broader customer base in North America,” a spokesman says. “We’ll show through e-commerce who we are, because our message is not fully out there about who we are today.”
In the past eight years, he adds, Le Chateau has gone from appealing primarily to young women under 25 who want chic but inexpensive apparel to attracting older women with a wider range of apparel including dresses and suits. “We’ve undergone a major shift in the last eight years by upgrading the quality of our merchandise to cater to a seven-day wardrobe,” he says.
The retailer has been expanding its lines in men’s wear, he adds.
At the same time, however, Le Chateau’s stores in the U.S. have been underperforming. The company closed one of its four U.S. stores earlier this year, and the three remaining—two in New York City and one in Newport, NJ—are slated to be closed within the next couple years as their leases expire, the spokesman says. The company also operates more than 200 stores in Canada and sells overseas through nine stores in the Middle East operated by a licensing partner.
The new e-commerce site is expected to launch in October with fulfillment handled by the same distribution centers that support Le Chateau’s stores, the spokesman says. The site, developed by a technology provider the retailer has not yet announced, will replace an interactive brochure site that lets shoppers send product information to friends via e-mail and Facebook links but not make online purchases.
Although Le Chateau realizes the e-commerce site could take some sales away from its stores, it expects the site to produce a net increase in customers, the spokesman says. If the e-commerce site helps to build the retailer’s brand in the New York metropolitan area and increase store traffic, he adds, Le Chateau could reconsider its plans to close its three stores there.
The company doesn’t plan to use its new e-commerce site to build sales beyond North America. Instead, Le Chateau will continue working with its international licensing partner to expand its presence in stores overseas, the spokesman adds.