Five Main Points to Macy’s Turnaround Initiative
Macy's is rolling out a new three-year business strategy called "Polaris" in the hopes of turning the tide against slumping sales as traditional retailers continue to struggle against the retail apocalypse.
In a press statement, Macy's CEO Jeff Gennette said the aim of the strategy is to strengthen each of Macy's brands, including its namesake company, Bloomingdale's, and Bluemercury.
Here's a closer look at each part of Macy's new business plan.
- Strengthen customer relationships
Macy's will launch the next phase of its rewards program, Macy's Star Rewards Loyalty, later this month. The updated iteration "is expected to increase the engagement of occasional Macy's customers and to bring new customers into the brand," according to a Macy's press release.
In an attempt to diversify its product assortment and elevate the brand, Macy's plans to develop four $1 billion "high-margin private brands" while also improving its current inventory selection.
- Accelerate digital growth
The retailer plans to capitalize on digital growth by increasing investments in Macy's websites and mobile apps. As part of this strategy, the company announced it would relocate its Macys.com headquarters from San Francisco to New York City "to allow for better coordination and increased collaboration and better access to Macy's brand partners." Additionally, Macy's will add positions to its technology hub in Atlanta.
Moving forward, Macy's plans to expand off-price stores including Macy's Backstage and Bloomingdale's The Outlet, both of which have been bright spots in the company's earnings reports in recent years. In 2020, the retailer will roll out 50 Backstage locations within existing Macy's stores and will open seven standalone venues.
In addition to store closures, Macy's plans to consolidate its campuses and designate New York City as its sole company headquarters. The move will effectively shutter offices in San Francisco; downtown Cincinnati; and Lorain, Ohio. It also includes closures of a customer contact center in Tempe, Arizona and customer service centers in Mason, Ohio; and Clearwater, Florida. In total, these closures are expected to impact 2,000 employees.