Not real as we are talking results against lousy comps. Macy's cannot be successful if the same brands are available in discount stores even if it is different merchandise. Home Depot, Costco , TJX, target have figured it out, why can’t Macys? They need the same dynamic merchandising initiatives that they have for events, parades, fireworks, flower shows and the same dynamic efforts as they have for real estate decisions -- customers have voted for more than 20 years for value just give it to them. A merchants job has always been defined as figuring out and giving the customer what they want, not what you think they need.
Backstage is a big mistake. Use the resources to grow Macy's. If nothing changes the enterprise will go the way of Sears and Lord & Taylor. TJX, Ross, Burlington, Costco, Walmart and Target own this business. In the case of TJX, Ross, and Burlington, Macy's/Federated gave it away to them. Macy's can reinvent the industry. And offer the best possible prices on all the major brands that have been funding for years as well as their private label. No one is doing this except for Costco mostly in other classifications. And they are a huge success. Customers have voted for value. Follow the customer and give them what they want with a unique twist. Not close outs but the very newest from the biggest most famous brands at real value price. Work to lower the rent, Lower the expenses, Lower the merchandise cost, lower the markup and lower the prices. Immediately the customer will react and move away from TJX, Ross, Burlington, Target and all others for modern ego-satisfying accessories, shoes, cosmetics, home goods and furniture.
Internet improved dramatically, but the store and the offerings are the same. You snooze you lose; if they do not make a dramatic change they will end up like Sears and Lord & Taylor.
Just listen to the customer. They have voted clearly for the last 15 years for value, with the exception of the highest luxury level. It is ridiculous to have acres of space devoted to Michael Kors when it is all over TJX. It is ridiculous to have Hilfiger, Lauren, Nautica, Nike, etc, when it is all over so called discount operations.
They should take out all these brands, force better prices, take lower markup and showcase the newest deliveries at great prices. The customer will immediately respond. This must be done in all departments. Dramatic presentations. Macy's name and real value on the newest merchandise with ego satisfaction and competitive pricing -- this formula is new and will bring dramatic results. The only retailer that comes close to doing this is Costco and look at their results. Macy's will be much more aspirational than Costco and will produce outstanding results.
All of the comments anticipate future positive results. However the most important has not been mentioned - VALUE - if other retailers follow their lead as well as those of TJX, Ross, Burlington, and Walmart, they will have a future as well. If not they will disappear as so many have. In retail you must listen to the customer and value is what she voted for, for the last 20 years. Of course there are exceptions i.e., Chanel, Gucci, etc.
Retail has always been about change. Athlesiure is an extension of the denim business, which has been huge and growing forever. The world has been going more casual forever. That was the source of success for Gap and Levi’s and many others. This trend is just evolving and customers insist on newness in any trend. The rule in retail has always been, if you snooze you lose. Gap and Levi’s should be more innovative and keep reinventing the casual trend or they will go the way of Liz Claiborne and Lord & Taylor.
Great news! This is positive -- however, it will take a lot more than this to bring the customers back. Most important, as I have said before, is there lack of ability to stop the brands they showcase so well, with dynamic display and aggressive advertising, to be sold in discount stores. This has been going on for years and never should have, but it is only getting worse.
I was in TJX in Wellington, FL. This is clearly a B store. As you walk into the store, the first thing you see is hundreds of handbags, many styles from Michael Kors. Even if these styles are made for them, it is ridiculous -- the bags were about $125.
If you go into any Macy's, you see a huge display of Michael Kors bags, displayed with major impact. The price is much higher, but that alone is not the issue. The label is compromised as it is in all price oriented chains.
In Herald Square, the department is in the best location with a really dynamic display. TJX customers only want them because they are in Macy's, which gives them ego satisfaction. The $125 price is a reach for the TJX customer, but they are happy to pay that as the brand is much more expensive in the department stores--this is true of many of the brands Federated/Macys has promoted for the last 10 years-or more.
This is a major reason TJX-Ross-Burlington-have been the darlings of wall street--and regular department stores have done so poorly. In fact, I bought a picture frame branded Tahari for $4.50 -- this is another brand Federated/Macy's, even Bloomingdale's have promoted over the years, although it is not as important now. Congratulations to Elie Tahari who has many multimillion dollar homes due to Federated promotion of the brand.
Yes the parade is great, but it does not ring the register.
Primark will continue to be more and more profitable. They must be sure they are paying very low rent. I am surprised they are opening in so many A malls, but I am sure they are negotiating hard.
The key to success in retail has always been to listen to the customer and give them what they want. They are doing that, Costco is doing that, TJX is doing that, Ross is doing that, The dollar stores are doing that, Burlington is doing that -- go to any mall they are in, like the American Dream, every store has very few customers. They have lines longer than I have ever seen (longer than Macy's or A&S in the height of Xmas in the '70s and '80s) -- customers waiting to pay with huge bins full of merchandise, even early in the day. There are affluent customers, young customers, older customers, men, women, kids, -- if you go to any of the stores I listed above and you look at the cars in the parking lot, you will see plenty of BMWs and other high-end cars.
The customer has voted for value for the last decade and more. I do not get it. Macy's and Penneys and other established retailers could even do it better, why are they ignoring the customer? Of course there are other opportunities to build a retail business but in terms of huge volume and profit, this is the obvious choice of the customer.
Absolutely agree -- in addition, a major mistake was allowing the brands which all the Federated divisions promoted and dramatically presented to sell to stores like TJX, and Ross and Burlington. A small fashion specialty store in South Beach, or Los Angeles or the meatpacking district or any shopping street in the US would not allow a line they carried to be carried by another small specialty store in a nearby location. This is the difference between an entrepreneur and a functionary. Unfortunately, when Federated took the decision making further and further away from the buyers, functionaries were in a position to let this happen. Traditional Federated buyers never would have let this happen.