December 23, 2015
Macy’s giving away cash cards to shoppers
Through a special arrangement, what follows is an excerpt of an article from FierceRetail, an e-newsletter and website covering the latest retail technology news and analysis.
With a few days to go until Christmas, Macy’s is giving away $10 gift cards to shoppers who visit stores between Dec. 20 and 22, effectively subsidizing holiday purchases.
Macy’s will offer a special giveaway of cash cards valued at $10 at more than 600 stores on these three days only. The cards will be distributed to the first 250 shoppers, on a first-come, first-served basis, beginning at store opening.
"As the ultimate destination for affordable gifts for everyone, we’re pleased to offer an extra holiday treat to our customers as they finish out their shopping over the next week," said Martine Reardon, Macy’s chief marketing officer. "We have a lot of great deals on last-minute gifts, and now shoppers who come early will get even more value with a free cash card on us."
Photo: RetailWire
Issuing gift cards or vouchers isn’t new for retailers which often try to entice shoppers back into stores after the holiday, but Macy’s cards are redeemable in stores on the same day. There is a limit of one card per customer and the card can only be used in stores, not online.
While Macy’s leads department store brands in terms of social media conversations and as a top pick among last minute shoppers, department stores are among the most pressured retailers in the mass market and luxury categories.
- Macy’s giving away cash cards to shoppers – Fierce Retail
- Macy’s Gives Away Free $10 "Cash" Cards To Help Shoppers Save On Last-Minute Gifts – Macy’s
- Nordstrom, Macy’s, Sephora top holiday social media conversations – Fierce Retail
- Last minute shoppers pick Target, Walmart – Fierce Retail
- Department stores ‘most pressured’ retail category – Fierce Retail
Discussion Questions
Is Macy’s $10 gift card promotion a healthy or unhealthy doorbuster? Do you see a different psychology to this type of promotion versus, say, a storewide discount?
Poll
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Dick Seesel
Principal, Retailing In Focus LLC
Ryan Mathews
Founder, CEO, Black Monk Consulting
Cathy Hotka
Principal, Cathy Hotka & Associates
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Desperate. How about taking that 1,500,000 and putting it towards retail sales training? That way your ROI wouldn’t be so short, it would impact every single transaction every single time and customers would rave about them.
Oh right, that lever is not on the horizon … but it should be for any retailer seriously trying to compete to a jaded shopper who’s tired of the rotten experience in brick-and-mortar stores.
Logic might suggest $10 cash is good, as I wrote in this post Logic Is Sinking Your Retail Sales.
Brilliant idea. I believe that offering guests a tangible “reward” is much more compelling than a storewide discount and will inspire more shoppers to make a purchase. Gift cards are very popular, and this will inspire a sense of urgency to make a purchase with the card NOW. Anxious to hear the results of this promotion.
This is the type of gimmick that many stores have used to drive Black Friday traffic, especially as a pre-emptive strike against the competition. Whether or not 250 customers can move the sales needle in a given Macy’s store remains to be seen, but it’s indicative of the issues this chain is having right now. Macy’s needs to fix its content problems (especially in women’s apparel) before it can expect a $10 gift card to fix its sales problems.
Am I the only one who thinks that Macy’s is giving away the store? If you pay full price for anything at Macy’s you’re a fool. This latest giveaway will do nothing but hurt their bottom line. I’d like to see the chain stand for something more than a coupon.
With the premise of a door buster, this becomes a good idea. With a longer term view of building loyalty with repeat business, it becomes a less compelling proposition.
The promotion will certainly generate interest with expectations of increased foot traffic. The underlying premise here is get the customers to the stores and incremental sales will follow. Therefore in-store execution and available inventory become key to turning the $1.5 million event into increased sales.
For a retailer of Macy’s size, the cost of this promotion is not excessive yet big enough to garner press and industry attention; Macy’s should be able to measure whether or not it met business expectations.
Outside of the short-term nature of such a shopping subsidy, it does reflect the remarkably heightened competition for customers’ share of wallet this holiday season and one retailer’s willingness to pay customers to shop in their stores.
I’m interested in learning if the $10 gift card must be used on an item over a certain price point. Regardless, this is a good way to get shoppers to open up their wallets in an environment where it is hard to pick just one small thing — most shoppers are bound to keep spending once they have started.
First of all, $10 isn’t going to take the average Christmas shopper all that far and secondly, shoppers are expecting a broad array of discounts, not just $10 off.
That said, the social media buzz probably comes close to defraying the cost of the program, so it isn’t all that bad.
Of course the “psychology” of the promotion, i.e., “something for nothing,” is different than a storewide discount, i.e., “save now or pay more later.” But the real questions are: a.) whether or not $10 is enough to make a non-Macy shopper make an additional trip, and b.) whether or not loyal Macy’s shoppers will be satisfied with such a small bribe.
Maybe Macy’s has figured out that Millennials don’t subscribe to newspapers. Those newspaper coupons have been their go-to promotion for years, but have to be diminishing in value. And there’s nothing more annoying that discovering that your fellow shopper is paying less than you are because she’s carrying a little piece of paper.
Who doesn’t want free money … unless you have to get up early, stand in line and spend it at Macy’s? This is just another way of training shoppers to never pay full price.
Maybe I was doing the Rip van Winkle thing, but I did not know about it until late morning on the 22nd. So I had no chance even if I wanted it. What’s with Macy’s? They have more coupons and more giveaways than any retailer I can think of. Business can’t be that bad, can it? That said, I am not a shopper by any stretch of the word. But when I do shop, I like Macy’s because I get more for less with all the coupons my wife has from them.
Give a $10 gift card to the best 250 customers per store who have not yet visited this holiday season, and then you have an incredible return on investment.
However, I’m guessing they’re doing this entirely so media will cover it. Mission accomplished.
I am 100 percent with Dave Wendland above. Remember that customers like the thrill of the chase. It’s far more exciting to get a tangible coupon than a discount at checkout which is old hat. This promotion gets customers to act (they have to come into the store to get it), then act again (as they put the coupon to use right away), and even those who are too late to receive the coupon will have the excitement and buying spirit ingrained in their very action of coming to the store.
Did anyone mention that it’s a $10 gift card, off of presumably properly priced merchandise that can be absorbed in the bigger picture? I think it’s a brilliant, healthy promotion. Good for Macy’s.
I am not so sure that the sought-after Macy’s customer is in a frenzy to break down doors for $10. This has all the necessary ingredients for a too little and too late sale effort. This expression is no less than a clear demonstration of the need to drive in-store sales the good ole’ fashion way. The time and money might be better invested in looking to the marketing shortfalls and needs. A good place to initiate the search might be in the direction of the company’s e-commerce and/or omnichannel results to date.
A friend of mine just told me he was at Macy’s yesterday with his kids and no one was there. Desperate measures by desperate players. Wait another week and get 25 bucks at that door!
I’m sure it is effective in getting people to shop. It creates an urgency for people to come in and also to shop and I assume also use the gift card.
Unfortunately, I think it is a slippery slope to go down. If you calculate 250 gift cards at each location for each of 3 days that is almost $6 million worth of gift cards, not to mention the cost of the cards themselves. IMHO there’s a lot more that they could do with that kind of money that would be an investment in the business rather than another margin eroding discount.
Do I see a difference? Yes it smacks of desperation; well, perhaps “desperate” is a bit strong, but it seems more promotional than useful.