Macy’s is turning stores dark for the holidays
Macy’s has decided that it will close two of its department stores to on-site shopping for the holidays. The retailer is choosing instead to convert the locations into dark stores that offer in-store and curbside pickup of online orders and enable product returns.
The retailer will use stores in Dover, DE, and Littleton, CO, as pilot locations for the dark store test, reports the Delaware News Journal. Macy’s did not disclose to the paper if it intends to turn any other locations into dark stores for the holiday season.
The department store chain, like other non-essential retailers, saw its online sales jump after it was forced to close stores due to the novel coronavirus. Macy’s reported a 34.7 percent decline in same-store sales (brick and click) during the second quarter as its online business jumped 53 percent. In-store sales fell 61 percent year-over-year.
CEO Jeff Gennette told analysts on the retailer’s earnings call that 30 percent of online orders were fulfilled by stores (curbside and in-store) in the second quarter and that he saw that “increasing” going forward.
“We’re building out in terms of our omni-network and our fulfillment strategies, our opportunity to be able to satisfy customers however they want to shop, in a store, curbside or same-day delivery, we will be able to do that,” he added.
Macy’s and other retailers testing dark stores can go into their pilot programs knowing that many consumers are open to using them.
A recent survey of U.S. consumers by WD Partners found that 47 percent are open to purchasing from a dark box store and 40 percent from a dark grocery store. Forty-nine percent are okay buying meals from a dark restaurant.
Whole Foods made news last month when it announced the opening of a 100 percent dark store intended to serve local customers in Brooklyn, NY.
- Macy’s converts Dover store to fulfillment center as online orders spike during COVID-19 – Delaware News Journal
- Macy’s, Inc. (M) CEO Jeff Gennette on Q2 2020 Results (Earnings Call Transcript) – Seeking Alpha
- Macy’s, Inc. Reports Second Quarter 2020 Results – Macy’s, Inc.
- Retailers need to reorganize like a 21st century business – RetailWire
- Is Whole Foods’ e-grocery business headed down a dark path? – RetailWire
- Macy’s plans for the Christmas rush – RetailWire
- Is the future of retailing going dark? – RetailWire
DISCUSSION QUESTIONS: Do you see dark stores as a good way for retailers to turn underperforming locations into productive sales assets? What do you think of Macy’s decision to convert some stores into dark locations for the holidays, and do you see other retailers doing the same?