The word is that Macy’s is exiting the dying mall and making its foray into strip malls, as it views these type of physical retail opportunities to be more lucrative. However, the move isn’t just about entering a new retail landscape. The company is also planning to adopt a low-inventory approach to keep its offerings fresh.
That said, Macy’s is expanding beyond the traditional mall setting, in response to investors’ perception of department stores as outdated and unexciting. The company is targeting customers in thriving shopping centers and rapidly growing suburbs, while leaving behind declining malls. In these smaller locations, Macy’s is showcasing a curated selection of popular brands, with displays that are regularly updated to remain current and attractive to customers.
CEO Jeff Gennette revealed during a recent CNBC interview that this year will be a crucial test for the new Macy’s strategy. The company will conclude its test-and-learn phase of the off-mall stores and determine expansion plans by the end of the year.
Gennette expressed optimism during a March call about the new Macy’s off-mall stores, saying, “The hope is that we’re going to have a model that we’re going to be able to scale more aggressively in 2024 and beyond. We’re very bullish on the concept, and the early learnings have been positive. The size and locations of the stores are all working.”
The New Store Concept
Macy’s has launched two smaller store formats: Bloomie’s and Market by Macy’s. These stores are about one-fifth the size of the company’s traditional Macy’s and Bloomingdale’s locations.
Bloomie’s offers shoppers a unique experience where they can browse clothing racks with a glass of wine in hand. The store even features a display of pet accessories and a water bowl for four-legged visitors. It’s not uncommon to see couples strolling through the store with a baby carriage in tow, enjoying the neighborhood…
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