Macy’s is hooked on the financial lift that Backstage provides – even at the risk of cannibalizing their full-line offerings. Shoppers love discounts, so I would hesitate to call Backstage a wild success – anyone can give product away. That said, there’s no question that Backstage is providing a much needed traffic and revenue bump to Macy’s, but the long-term implications are very uncertain. Given the struggle Macy’s (and department stores) have had it’s not surprising that management is running with the strategy that has delivered a glimmer of success.

Have any of you seen or been in one of these? Are they supposed to be a competitive swat at dollar stores? Trashing an already denigrated brand is not the way to go IMO. Hey skipper! Reverse course! Not only am I not a fan, but i just don’t get it at all. Nordstrom Rack? Ok. Backstage? Huh?

Merging both full-price and off-price concepts within the same space may drive some additional overall traffic, however, what may result from this move is more confusion about what the real Macy’s brand messaging is. Macy’s has aspired to move to an experience-first, omnichannel, digital, customer-focused model with the introduction of a more curated experience, introducing pop-ups and more creativity within their stores.

While the Macy’s Backstage concepts shops are building momentum, positioning them within the Macy’s full-price department stores may detract from the full-price, more premium retail traffic, as the targeted customer will only be seeking discounted merchandise. There may or may not be an overlap, as the bargain-seeking consumer may not be motivated to buy any impulse driven full price products.

The purpose of Backstage is twofold. First, it is a format which gives Macy’s access to the popular off-price part of the market. Second, it provides Macy’s with a channel to clear down excess and unsold inventory. Both of these things make it a worthy venture.

As a stand-alone concept, I am a fan. However, I remain more skeptical about adding Backstage to full-line stores.

From our customer data, we see evidence that such a move pulls customers away from the full price offering at stores and ends up cannibalizing sales. It also sends confusing messages to the customer about the Macy’s brand.

True, it may generate short-term sales, but it could ultimately damage the health of larger stores in the long-term. What’s more, I am skeptical of the numbers being bandied about. I expect they have been measured over the robust period in the run-up to the holidays when trade in all segments of the market was on the up.

It’s hard to argue with the sales lift that Backstage has brought to the first group of stores, but I have my doubts about the long-term strategic impact. From the local Macy’s store with a Backstage installation, I see a messy collection of “stuff” that doesn’t even meet the housekeeping standards of my local Marshall’s — not to mention the standards of the rest of the Macy’s store. And the off-price space is getting very crowded, at the risk of oversaturation.

It would be worth knowing more before passing judgment: Is the sales increase driving any kind of gains in Macy’s “upstairs” departments? And what kind of product is selling in Backstage? Again, from my observation, the “upstairs” brands at Macy’s have no interest in selling their labels inside Backstage, so the brands I shopped could just as easily be found at a Kohl’s or J.C. Penney store.

Execution, execution, execution. Off-price stores like TJX aren’t slapdash; they’re meticulously merchandised with ever-changing assortments. One TJX IT leader told me that the company will remove items from assortments if they get too popular, because the element of surprise is lost. Does Macy’s have the right people to make this happen?

The only way it makes sense is if the merchandise in the Backstage area keeps changing AND if Macy’s continues with other innovations. If the merchandise continues to change so that there are new finds on every visit to the store, then consumers will come back. However, one tactic does not spell long-term success. Focus needs to be on the experience of consumers who patronize a particular store — what is interesting to them? What will keep them coming back?

As I wrote in this recent post, Macy’s Off-Price Retail Cannot Be The Way Forward, Customer Service Must Be, orphaned clothes, man-handled, stretched and laid out on ’60s chrome fixtures in underused and underlit parts of their stores are their way forward.

Macy’s feels shoppers have changed …

Karen Hoguet, chief financial officer of Macy’s, when talking about shoppers in their stores was quoted as having said at an investor conference last year, “Lots just say, ‘Leave me alone — let me get the shoe I want and move on.’”

Well of COURSE they said that!

When all an employee can parrot is, “can I help you find something?” Or, “looking for anything special?” — what do you expect shoppers to say?

Shoppers used to make a special trip to discover items presented with care and thought along with employees who not only liked working there but were trained in how to engage them.

And shoppers haven’t changed. But let’s be honest, Macy’s stores have …

The problem I see with Macy’s Backstage store-within-a-store concept is its implementation of that store-with-in-a-store concept. The Backstage areas I have visited are plunked in the middle of other departments and, other than signage, there is nothing else that identifies or segregates it from the rest of the store. Uninitiated consumers may not even realize what they are looking at because it’s confusing to see carefully-merchandised new and full-priced items displayed across the aisle from “Last Chance!” product that’s stacked on tables. Backstage needs its own look so that stands out, otherwise it’s just another big clearance sale.

Brand be damned! Sell whatever and however is necessary to stay in business.

If taking floor space from Macy’s and giving it to Backstage is their idea of good strategy then they’ve fallen farther than I imagined. It is another unintended consequence of teaching your clients that one should never buy anything unless it is on sale.

I predict that Backstage will creep to be the dominant brand inside many of the stores formerly known as Macy’s.

Did anyone else think of the phrase, “…you can’t make a silk purse out of a sow’s ear”? It used to be called a clearance section! We use our language to embellish or mask the truth. Simply branding a clearance section doesn’t change the obvious. I’m certain George Carlin would be able to create a bit around what is happening in retail today. I guess we’re all guilty of it.