Physical store closures and a renewed focus on online activity are some of the major talking points of a new strategy for US department store chain Macy’s, in an effort it claims is to meet the changing needs of consumers.
Macy’s Inc. revealed yesterday that it will be merging its online and store merchandising teams, expanding its San Francisco digital technology unit with 150 more employees, and opening a new direct-to-consumer fulfilment centre in Oklahoma.
“Our business is rapidly evolving in response to changes in the way customers are shopping across stores, desktops, tablets and smartphones,” Macy’s CEO Terry J. Lundgren told Internet Retailer.” We must continue to invest in our business to focus on where the customer is headed—to prepare for what’s next.”
The new Oklahoma fulfilment centre will also improve its online offering, joining similar centres in Arizona, California, Connecticut, Tennessee and West Virginia. Efforts will also be made to better equip its physical locations to fulfil orders directly.
To balance the books Macy’s will be closing 14 of its physical locations, and trimming about 2200 jobs across its other outlets. The closures will be offset by the opening of a number of new stores, including a joint venture in Abu Dhabi with Al Tayer Group due to open in 2018.
Similar changes are also being flagged for Bloomingdale’s, which is owned by Macy’s Inc.
“Going forward, Macy’s and Bloomingdale’s will be better able to move more quickly and nimbly to select merchandise, assort inventories and serve total customer demand, no matter how, when or where the customer shops. Some redundant activity also can be avoided to accelerate speed to market, partner more effectively with vendor resources and ensure the merchandising organizations are more responsive to the marketplace in making and implementing decisions,” Lundgren says.
The changes are being made in response to positive signs in Macy’s recent sales figures, citing a 2.7 percent growth in the past few months as in line with company projections. The new same-day click and collect scheme has also been well received by customers.
“These innovations demonstrated the power of the stores working in collaboration with online and mobile to satisfy customer demand, no matter how the customer is shopping,” Lundgren told the Wall Street Journal.