2016/07/22

Seven Signs Of Life At Macy's

Just when folks were ready to write Macy’s off, it came up with a series of announcements that signal renewed energy and innovation.
Department stores are hurting, of that there is no doubt. Until recently we called this class of retailer “traditional,” but lately the word “legacy” has been used, and not in a good way.

Legacy implies obsolescence. According to one definition, a legacy is “anything handed down from the past, as from an ancestor or predecessor: the legacy of ancient Rome.”
Not a term you want associated with your brand. Not today. Not ever.

Macy’s is a legacy retailer. A holdover from the past , a time when people shopped large department stores for multiple categories. When they paid full price or looked forward to sales as events, not as an everyday occurrence.

And in spite of many attempts to modernize the store, to integrate new technology and stay abreast of fashion, Macy’s has often seemed stuck.

There were great and visible efforts, such as the transformation of Macy’s flagship in Herald Square. The addition of branded shops, new lights, fixturing and luxury labels created a vibrant and lively environment.

But go up those old wooden escalators and it was a different story—racks of lackluster merchandise in dark, cavernous spaces. It was indicative of the depth of Macy’s challenges that are taking an awfully long time to address.

That old saying about taking a long time to turn a big ship applies here. Macy’s is a mammoth operation and even with all hands on deck, the best and brightest need time to chip away at silos, change institutionalized customs, work through bureaucracy, access budgets and implement new technology.

It’s so much easier to be a start up and begin from scratch.
Macy’s hasn’t been sitting on its heels, quite the opposite, but it takes time for projects to bubble up and come to fruition. Here are seven signs of life at Macy’s right now.

Partnerships
Macy’s has long relied on celebrity partnerships, as seen in many holiday commercials where Martha Stewart, Donald Trump and Jessica Simpson partied in a Macy’s store. Trump is gone from Macy’s and while Martha Stewart remains, the relationship is tarnished following a squabble with JCPenney that ended up in court.

It’s time for some fresh faces and Iris Apfel is just that. The 94-year-old fashion icon is the best thing to happen to Macy’s in a long time. She appeals to young and old alike, and the special Iris Apfel emoji that will accompany the line’s release will too.
Macy’s is also expanding on its Thalia Sodi partnership. Sodi is a Mexican entertainer and her fashion line landed at Macy’s two years ago. Now that’s being extended into intimates at time when that category is being disrupted and is ripe for  new retailers to grab market share.

Sodi’s intimates includes shapewear and has pieces that double as streetwear, making it all the more versatile, crossing ethnic groups and demographics. There’s also a strong bridal component, an area that Macy’s is building and rightly so. Millennials are getting married, striking out on their own and starting families. This market has always been strong for Macy’s but hasn’t been freshened up and was long over due.
Macy’s hasn’t given up its legacy brand strategy yet though, as evidenced by the new home collection with Kelly Ripa. Yawn.

New Store Design
There’s a store in Columbus, Ohio that Macy’s promises is 100% brand new with expanded wedding department and Tux shop, a health and wellness section, and an expanded beauty departmentcomplete with a Bluemercury shop. These are three growth categories and it’s good to see Macy’s concentrate on them with such vigor.

Backstage
Macy’s Backstage is the department store’s answer to off-price retailers such as Marshall’s, T.J. Maxx and Ross Dress For Less. This group is on fire right now as shoppers continue to show a preference for these value-oriented formats.
Backstage will carry merchandise not typically found at Macy’s stores such as toys and other kids items, offer discounted designer goods from the flagship stores and manufacturer overruns that can’t be found at the “legacy” stores.

Mobile
Macy’s is heavily focused on mobile, as most retailers are. But while many merchants are busily building apps hoping that shoppers come, Macy’s has take a good look at its customer base and smartly focused on mobile web.

Mobile web visits to Macy’s have soared, according to a new report by SimilarWeb. Roughly 57% of shoppers are accessing Macy’s site via a mobile browser and new initiatives are focused on maximizing this user.

Macy’s on Call
Which brings us to Watson. This week, Macy’s announced a partnership with IBM’s Watson. It’s a new mobile platform that pairs artificial intelligence with a smart engagement platform from Satisfy. It’s named “Macy’s on Call” and is being tested at 10 Macy’s stores nationwide.

Shoppers can access the service on mobile web (not the app!) and ask questions worded in natural language, not computer-speak or options from a drop-down menu. They can find products, get help, request assistance, and access in-store services.

There’s also a Spanish language option.
Further, Macy’s has strategically selected the test sites that represent a good cross-section of customers. Five locations will create a baseline for the test and function just as self-serve feature on the mobile web, and the other five will offer additional services.
The goal is to learn more and by partnering with IBM, this test is far more likely to yield productive responses than one built in house.

Smart PR
Macy’s has been dominating the news cycle of late. I write a daily newsletter and there’s barely been a day this month that didn’t have some tidbit of news about Macy’s. A new partnership, a store opening, or a piece of tracking data to show growth in mobile users, all released in quick succession.

It’s a page from Amazon’s playbook and a good one. Macy’s communications team has staggered its news, keeping the brand in the media for long stretches. Even small items are getting press. It’s free advertising for Macy’s and making an impression on investors.

New Guard
Last but not least, is the retirement of Macy’s long-time CEO Terry J. Lundgren. It’s difficult to be fresh and new with legacy leadership at the helm. It’s not that Lundgren can’t lead Macy’s, all these new initiatives began under his stewardship, but it’s time for someone else to pick up the torch.

The man who knew enough to innovate the old also knows it’s time to step aside and usher in the new.

There are still strong signs of life in the old girl yet. Heck, it was even named Brand of the Year in a recent Harris Poll.

Follow me on Twitter @lfheller, get my newsletter at FierceRetail
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