Macy's is working to attract the millennial generation through various marketing strategies and retail initiatives. These include My Macy's, which customizes each store's merchandise to the local community, Omnichannel, which integrates store, website, and mobile commerce, and MAGIC selling to provide a personalized customer experience. Macy's is also expanding its private label brands, currently making up 5-10% of brands but planned to be 50%, targeting millennials. However, competitors like H&M, Zara, and Nordstrom may have an edge through fast fashion strategies of more frequent new styles at lower price points.

1. Macy’s Case Study
Danielle Hughes

2. Withthe millennialgenerationbecomingthe largestpopulation,retailersare havingtofind
waysto keepupwiththe quicklychangingtastesof thistechsavvygeneration.Theyalsohave tofind
waysto draw themnotonlyto theirstore locationsandcontinue the brandloyaltythatwasestablished
withtheirparents.Macy’shas made it one of theirinitiativetoreachout thisgenerationbyestablishing
marketingstrategiesthatwillgive themthe competitive advantageovertheircompetition.
Macy’s has changedthe way theybringservice toitscustomerswithM.O.M.whichstandsfor
My Macy’s,Omnichannel andMagicSelling.MyMacy’s ‘focuseseachstore onitsmerchandise
assortment,visual merchandising, service levelsandspecialseventsthatare rightfor customers.By
givinglocallybasedexecutivesthe powertomake more andbetterdecisions,MyMacy’s customtailors
a store fit withitscommunitytocapture customerloyaltyandmarketshare while drivingsame store
salesandprofits’(Macy’s2012 Annual Report).Macy’sismakingsure that itfitsitself towhatcustomers
needtobringtheirloyaltyandreturnbusinesstothe company. Omnichannelmeanstakingstore,
website andm-commerce andmakingthemall one inventory.Thiswill helpthe companygetthrough
theirinventorymore quicklyandbringinnew stockmore quickly.MAGICsellingstandsforMeetingand
make a connection,Askquestionsandlisten,Giveopinions/Give advice,Inspire tobuyandsell more and
Celebrate the purchase.Thesefive statementsmove Macy’scustomerservice toamore personalized
experience thatwill show customersthattheyare caredabout and will make customerswanttoreturn.
Macy’s retail strategyshouldfocusonhow to bringthe millennial generationintotheirstores
insteadof usingthe internetandmobile devicestopurchase theirgoods. One of the waysMacy’s is
tryingto bringpeople intotheirstoresiswithprivate labels. Macy’scurrentprivate labelsmake up5-
10% of theircurrentbrands focusedonthe millennialgeneration.Withplanstoexpandtheirprivate
labels,theirproductswillmake upatleast50% of theirfloor.Thiscouldbe a huge stepfor Macy’s to
findtheirstepinthe millennial hold,butwill itbe able tokeepupwiththeircompetitors?

3. The top competitorsof Macy’s have steppedoutof otherdepartmentstoressuchasNordstrom
and JcPennyandintothat of fast fashion retailerssuchasH&M, Zara and Forever21. The merchandising
strategiesthatthese companieshave installed(more styles,lessdepth,more often) hasgiventhe
competitiveedge thattheyneedtobringcustomersinmore andhas helpedthemstayaheadof
everyone else inthe retail business.Macy’swouldbenefitfromfollowing thisstrategy.The millennial
generationislookingfora retailerthatisgoingto give the more optionsandkeepupwithnotonlytheir
fastpaced lives,butalsothe trendsthatare quicklychanginginthe fashionindustry.
Macy’s area that theyhave setup to reachto the millennial groupisthe Impulse areaof their
stores.Thisarea consistsof brandssuch as Rachel byRachel Roy, Free People,LuckyBrandJeansandJ
Brand. Macy’s has placedtheirownprivate labelsintothisareaaswell,theirtwomostprominentare
Made and Bar III.One of the initiatives thatMacy’shas placedisthat theywill be releasing13new
private labelsinthe Impulseareabythe endof 2013 (Macy’s2012 Annual Report).Private labelsare a
riskymerchandisingstrategy totake on,inmyopinion. Withfocusingmostof theirenergyinthis area,it
will fall backonto Macy’s if theirbrandsdo not performwell. Macy’scompetitorsare more focusedon
bringingcustomersinmore oftenandkeepingtheminterested.
Macy’s is alsofindingwaystomarketthemselvestothe millennialgeneration.Theyare takingto
the internetandpostingonFacebook,Twitter,PinterestandInstagram.These are all waysto getthe
millennial attention. Macy’shasalsostartedMblog whichisa Macy’s bloggingsite.Onthissite,bloggers
give unique perspectivesontrends,stylesandwhatishappeninginthe fashionindustry.Sincethe
millennial generationissuchatech Savvygeneration,thesewaysare of marketingtothisgroupwill
defiantly catchtheirattentionif done correctly.
The Impulse are of Macy’s has a lotof brands happeningthatbringdifferentstylestothe
customer.Italso reachesintothe areaof shoesandcosmetics.Withbringinginmore private labels,

4. Macy’s needstomake sure that theyhave a competitive pricingstrategyagainstH&M,Forever21 and
Zara, but alsoneedstomake sure there pricingstrategydoesnotlowertheirbrandequityandkeeps
themcompetitivewithhigherprice pointcompaniessuchasNordstrom.Macy’sneedsto notfocus
mostof itsattentiontoprivate labels,buttomarketingitself tothe millennial groupthroughsocial
mediaandbringin the conceptof fastfashion.
The Competitors:
H&M’s merchandisingstrategyisthatof fast fashion.More optionsandlessdepth,customersreturnon
a weeklybasistosee whatnewproductshave beenplacedinthe store.Itkeepsthemcontinually
interestedthattheycangetnewthingseveryweek.Their price pointsalsohelpwiththeircompetitive
advantage.H&Mhas clothsas lowas $4.95 up to $50+. This reachesoutto all age spectrumsinthe
millennial group,those whoare gettingallowancefromtheirparentstothose whoare college graduates
and workinginentrylevel jobs.The one pointthatMacy’s has overH&M iscustomerservice.H&M

5. seemstobe understaffedandwheneveryoudofindsomeone tohelpyou,theyseemputoutthatyou
are askingthema question.Macy’scanlearnfrom H&M that havingmore optionswithasmallerdepth
will bringinthe customersmore thanonce a month.
Nordstromhasset the bar highincustomerservice foryears.Now theyare settingthe bar high
withthe millennial generation.Nordstromhascreatedhighqualityprivate labelsthathascustomers
returningforthemknowingwhattheyare payingfor.Nordstromhasalsosteppedintothe realmof fast
fashionintheirSAVVYdepartment.Thisdepartmentchangesitstrendsandlooksevery21days.All the

6. otherdepartmentthataimto the millennial generation(pointof view,T.B.D.andBrassPlum) receive
newmerchandise everyweek,whichalsobringscustomersintostoresonaweeklybasis.Nordstrom
alsodoesinstore eventssuchastrunk showsandtrendshowsthat give customersaninside lookon
howto put themselvestogetherandreceiveadvice fromprofessionalsinthe industry. Nordstromalso
usessocial mediasuchas Facebook,Instagramandnow Pintresttograb the attentionof the millennial
group,whospenda good amountof time on theirphonesandinternet.

7. The products that are offeredinthe Impulse departmentrange fromdresses,tops,skirts,jeans,
rompersand skirts.Each brandoffersa differentassortment,buttheyare similardue tothe seasons
and trends.50% of the assortmentistops(all brandsbeing apart of thispercentage),30% consistsof
bottoms(jeans,slacksskirts,etc),the last20% consistsof dresses,rompersandmiscellaneousarticlesof
clothing. Atthe moment,there are not as many private label brandsasthere are otherbrandsin this
department.Withthe planof 13 newprivate labels,the departmentwill probablysee adropincertain
brandsto make room for the newbrands. The average price pointsforthisdepartmentbegin at$59 and
reach upto $215. The price pointsare higherthanthose of H&M and Nordstromintheirdepartments
that reach outto the millennial.Thiscouldbe astrategythat Macy’s shouldreconsidertogive them
more of a competitive advantage.Withcompetitorswithalowerprice point,Macy’smaynotreach
theirtargetmarketdue to theirpricing.
Macy’s is one of the biggestadvertisersinthe retail industry.Theyrunadvertisementsinthe
newspapersaswell asmagazinesandTV andradio spots.Theyalsoreach outto theircustomersvia
email toletme knowof newpromotionsandsales.Withthe initiativetoreachout to the millennial,
Macy’s nowtakespart in Facebook,Intagram, TwitterandPintrest.Theyalsohave launchedtheirown
bloggingwebsite calledMblog.All of these social mediaavenuesare waystoreach theirtargetmarket
whichisalwayson the go and usingtheirmobile devices. Wheninstore,there are signspostedabout
salesas well astheirMacy’screditcard. Macy’s hasalso hadmany celebritycollaborationsbothlong
termand short term.One of theirmore well-knownonesiswithMadonnaandherTruth or Dare brand.
The customerexperience forthe Impulse sectionof Macy’s.comissimple tounderstandbut
coulduse some changes.When youfirstgo to the Impulse sectionof the website,ithaslinkstolook
booksfor Made and Bar IIIas well aslinkstoboth of the collections.Ithasmovingpictureswiththe
mostcurrent trendthat isbeinghighlightedaswell aslinkstocontest.There are clearlinkstobags,
accessories,shoes,andbeautytogoto the Impulse brandsinthose locations.Ihadto searchfor the link

8. that said‘brands’whichtookme to the other Impulse brandsthatwere notMacy’s ownprivate label.
Whenlookingatthe products itprovidespictures,withadescriptionandsizingchartthatcan be used.
Shippingisfree withapurchase of $99 or more.For anypurchase under$99, shippingisa flatfee of
$9.95. Returnscan be made instore or mailedbacktoonline.Myonly suggestionsforthe online
experience wouldtobe to make iteasierto get to the otherImpulse brandsinsteadof asmall linkatthe
bottomof the page.
The in store experience haschangedwithinthe lastcouple of monthsatthe SanFrancisco
Macy’s. The store was once clutteredonthe Impulse floorandhardto lookthroughthings.The flooris
nowcleanand well organized.Salesassociatesare veryknowledgeable aboutproductsandwillingto
answeranyquestionsyoumayhave.Whenif the fittingrooms, theytake yourname andreturn
frequentlytosee howyouare doingandask if youneedanything.The store layoutiseasyto navigate
and findthe differentbrands.Whatwasonce a frustratingfloorforme to go lookthroughhasnow
become cleanandeasy to findwhatI am lookingfor.The onlysuggestionthatIwouldhave istohave
more associatesonthe floor.WhenI wasat thislocationthere wasonlyone associate ineach
departmentandthe womenwhowashelpingme hada lotof customersthatshe was tryingto helpand
take care of.
Macy’s is makingitswaytowardsbringthe millennial generationtoitsstore.Ithinkthat
bringinginsomany private labelsinveryriskyforthe company.There isnoone to helpwiththeirgross
margin,and if the labelsdonotdo well,Macy’sistaking100% of the hit.I believethattheyare taking
the right stepstoadvertise tothe millennial groupandletthemknow thattheyhave the brandsthat
theywill love.IbelievethatMacy’sfollowingM.O.M.has reallychangedtheircustomerservice ina
goodway and will buildtheircustomerloyaltymore thantheyalreadyhave.Ialsobelieve thatwith
turningto an omnichannel,Macy’swill be onthe pathto havingmore ideas,lessdepth,more oftenand
bringinginthe millennialgenerationmore thanonce aweekor once a month.