December 21, 2006
Macy’s Courts Out-of-Time Shoppers
It’s just a few days before Christmas and the pressure is starting to build for those who have yet to buy presents and have ruled out going the gift card route. For those consumers, at least those living in proximity to the borough of Queens in New York, there is hope.
Starting this morning at 7:00 A.M., the Macy’s at Queens Center Mall will open for 83 straight hours. The uniqueness of a department store operating 24/7 has not been lost on those hearing the news.
Kathy Grannis, a spokesperson for the National Retail Federation (NRF), wasn’t positive but said this could be the first time a department store operated around the clock. “It’s incredible,” she told the New York Daily News.
Consumers had mixed reaction to the announcement.
One shopper, Nicole Sandy, called Macy’s hours “a procrastinator’s dream!”
Evelyn Bodan, a retired public school teacher from Jackson Heights, said, “I ain’t going to be here at 3 o’clock in the morning. I think I have better things to do, like sleeping.”
Howard Davidowitz, chairman of Davidowitz & Associates, thought Macy’s test in Queens had merit. If “it’s good the first day or two, they will do it with other Macy’s stores,” he said.
Discussion Questions: Will the novelty of Macy’s being open 24 hours in the lead up to Christmas catch the attention of consumers? Even if traffic is
light, will the effect of the publicity surrounding the expanded hours draw curious consumers to the store? Do you see Macy’s or other department stores attempting this next year?
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The idea that a customer might have an emergency and need diapers or band-aids or a medication in the middle of the night makes it wonderful that a few drugstores stay open 24 hours. The idea that a customer could have an emergency and need sterno, or milk or chicken soup in the middle of the night makes it wonderful that some grocery stores are able to stay open 24 hours. The fact that many people work long or unusual hours during the holidays makes it wonderful that stores of all types have provisions to be open and accommodate shoppers through expanded hours both before and after their regular times.
But, the idea that any customer is going to have a gift or fashion emergency and need to run out and get an Alfani blazer or Vera Wang perfume at 4:00 am is pretty silly. This announcement by Macy’s is designed to generate buzz and free advertising (courtesy of the news media) that they so badly need at this time but it is not likely to result in any real sales benefits toward their bottom line. The added costs of security and staffing plus mistakes caused by worker fatigue may actually make it a net loss in revenue for them. Only time will tell whether it was a wise trade-off.
It’s a worthwhile experiment for Macy’s to try this in one of its high-volume urban locations. There will be a lot of “learnings” between now and Sunday evening:
1. Does it drive incremental sales?
2. Does the PR buzz itself make the location a magnet for consumers who might otherwise shop different mall anchors or stores?
3. Do the added operational costs (especially payroll) offset the volume gains? And how much payroll is “enough” at 3am with no history to use as a guide?
4. How does the store deal with issues of replenishment and recovery that might otherwise be handled overnight?
No question that we can expect to see imitators next year, not only from selected department store locations where the conditions are right but also from big-box competitors who like what they see and feel they can execute even better. It all depends on whether this experiment delivers incremental, profitable sales.
Why not make it easier for consumers! We can already shop 24/7 online so there is a competitive issue at play here. I personally like to touch and feel the gifts I am giving to loved ones, so in this time starved world we are racing around in, this may actually work!
If it is successful, look for all the stores around Macy’s in shopping malls to have a decision to make about matching the openings.
Macy’s is considering round-the-clock operations during the Christmas season. While we admire Macy’s innovative spirit, I don’t think Macy’s mass marketing, self-service model will work very well. Think about the staffing and security concerns. Could they figure out a more effective technique without having to fully staff the store?
Let’s look at who might be in line at 10pm when the extended hours kick in. First in line will be the last minute shoppers. Right beyond will be the crowd averse posing as a last minute shopper. Next will be the day shift or two job workers. Followed by the insomniacs. Last in line will be the homeless looking for a warm place for the evening.
Macy’s should follow more effective strategies for each. For the last minute shoppers, Macy’s should offer personal after-hour, shopping service. If the store is only open to personally escorted patrons, Macy’s doesn’t need the full staff complement. Sign up for the service in advance.
Crowd averse shoppers should be served by Macys.com. Macy’s should have a dozen Internet terminals near the main doors with personal shoppers assisting them. Keep these folks out of the stores. There’s no telling what they’ll do.
Day shift and two job workers are not good prospects for all night shopping sprees. They need to be home catching some winks. If they show up during the extended hours, take them over to the Macys.com web site and show them how to shop online. Otherwise, offer personal shopping services.
Insomniacs? Offer them a cup of coffee and personal shopping service.
Homeless? You don’t want them roaming your store, unescorted, at 2 am trying out mattresses.
Good luck. Macy’s Queens. But don’t expect us to be there shopping. We’ll be snug at home, fast asleep.
I got a chuckle out of the “retired public school teacher” using the word, “ain’t.” I guess the good news is that schoolchildren are no longer exposed to her.
To the issue at hand, however, what took them so long? Round-the-clock retail operations are nothing new, and to me the amazing thing is that this is considered such a novelty. One question I have is, is every department going to be open? For instance, in 24-hour supermarkets, the deli, bakery, pharmacy, coffee shop, service meat counter, and other departments shut down (and turn out their lights) during the evening hours. Shopping in these stores in the wee hours is a little spooky. Will Macy’s maintain a Christmas “feeling” by making ancillary departments available to shoppers — like gift-wrapping, watch repair, returns, wedding registry, snack areas, etc.? Or, will it be spooky?
It would be very surprising if Macy’s attempted this without having considered all the problems raised here, and more. Perhaps they saw them more as challenges. It has also been noted that supermarkets have been staying open 24 hours for quite some time. It can be done and strikes me as a sensible and innovative approach which may attract more customers throughout the year, not just this week. In my totally unscientific observations in NY last week, on the subway and walking the streets of Manhattan, more people were carrying bags from Macy’s than any other single store (except possibly Brookstone). Whatever difficulties they may have had this past year, as discussed regularly on RW, there still seem to be a lot of people spending their hard earned bucks at Macy’s. More power to them.
It’s all getting a little sad isn’t it? Retailersstart to merchandise for Christmas months and months in advance, getting earlier every year, and still some retailers feel the need to open longer hours to satisfy customers who haven’t reacted in time!
I’m sure this will be relitively succesful, because many people, especially in area’s where stress related jobs don’t allow time for adequate shopping, simply leaving it late.
Whether or not it is a financial success against salary and additional costs, we will have to see. This will then result in whether or not Macy’s and other stores conduct a similar exercise in future years.
When supermarkets commonly went to 24 hour operation years ago, a common rationale was that night crews could straighten the shelves, clean and restock, so the costs of the extra hours open to the public would be moderated. The night crew could be trained as cashiers, yet also work at other tasks when the customer traffic is minimal. Perhaps Macy’s has a similar strategy. The biggest problem: staffing.
Most people don’t like to work the overnight shift. What’s less popular: changing people’s shifts so their sleep cycle gets disrupted. The first week or so, people get tired and cranky. So changing shifts for a short period can make morale worse.
What’s odd about this: Macy’s Manhattan is a world-famous tourist destination. If there’s a place to try extremely late hours or even 24 hour operation, wouldn’t that be a better market?
Sounds like Christmas just came early for some shoplifters! As someone who wouldn’t want to shop or work in the middle of the night, you have to credit Macy’s for trying different things this holiday. If you think about it, they probably aren’t going to be open that much more than a lot of malls around the country. Some malls will open at 7:00 a.m. on Saturday and stay open until 11:00 or 12:00 p.m. so why not stay open? My only advice is to bulk up on loss prevention staff; they’re going to need it.
From a marketing perspective, Macy’s has achieved an increased “share of mind.” By doing something never done before, they get press and publicity. By doing it in one store, they keep the costs down.
All the operational and executional points raised by other contributors are right on, and I think, almost certainly something Macy’s was aware of. Whether these issues have been addressed effectively is another question, but time will tell.
I am going to believe that this really is about customer service. Yesterday I read that last minute shopping is expected to be at an all time high this year. So staying open 24 hours, given that expectation, is a customer service. There is almost no way that it can be a profitable thing to do, operationally.
OK, trust outweighs skepticism. Good for you Macy’s!
Green stamps were once a novelty until most every one had them and it was so saturated that now they are gone. They were once an early form of loyalty programs (which even then weren’t really creating loyalty). Twenty four hour operations in supermarkets were once a novelty in years past – now are common place. Opening at 5:00 AM on ‘Black Friday’ was once a novelty that has now backed up to 12:01 AM. Some novelty now, right?
All of the issues that have been mentioned are valid. The only issue that hasn’t been made is differentiation. What does this do to differentiate Macy’s? My thought is not much. Whether it works or not they are probably hooked into it. Others will imitate whether or not it works. So, there is little chance that other than this one instance, this has little opportunity to create any point of differentiation for Macy’s. When all else do it next year, who will really remember that Macy’s was the one whom started it in the first place?
Certainly Macy’s can be applauded for trying something if trying anything is worth praise. What’s missing is a reason for the consumer to either come during off hours or a reason to shop there in the first place. Further blurring points of differentiation between Macy’s, other department stores, and other mass merchants offers Macy’s any strategic value for the future.
Offering consumers a reason to visit Macy’s isn’t done by the hours that they are open. It would be done by Macy’s offering goods, services and equally as important an experience that can’t be matched elsewhere. I’m sorry, but a ‘spooky’ trip through a half open department store just isn’t the type of offering with mass appeal. I question whether or not it even has incremental appeal to anyone other than the common shoplifter.
This strategy and its success will presumably be measured by the additional revenue it will generate. As noted in the responses to date, the challenges of staffing, shoplifting, loitering, and general customer service in a department store at 2:00am are going to be difficult to overcome. This strategy just seems to be yet another ‘operational-centric’ decision that appeases the system and not necessarily the customer.
Perhaps Macy’s should develop a creative promotion and method of communicating after hours online shopping in-store during business hours. Their customers (and Macy’s margins, and hence shareholders) would be far better served.
It isn’t how long the retailer is open, but what occurs during the consumer and sales associate encounter.
By the way, and with all due respect to the eastern part of the U.S., the retail approach is a little different elsewhere.
Macy’s and Nordstrom in NYC have different marketing efforts than in a Chicago, or the West Coast market. Hmmmmmmmmmm
Excuse me, but this is just a mess. The problems with around-the-clock operation have been well outlined above and does Macy’s REALLY need to muddy the waters of the respectability and status of a “department store” by operating in even MORE of a Wal-Mart standard? A 24/7 operation is NOT the solution for poor merchandising, poor service and lack of excitement and enticement by a combination of the above, and advertising strategy/campaign as well as store ambiance. I don’t mean to single out Macy’s here either and I don’t want to be mean but BE a DEPARTMENT STORE. Operate as you should AND CAN and that will solve your problems so that outlandish and poor solutions will not have to be attempted.
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The idea that a customer might have an emergency and need diapers or band-aids or a medication in the middle of the night makes it wonderful that a few drugstores stay open 24 hours. The idea that a customer could have an emergency and need sterno, or milk or chicken soup in the middle of the night makes it wonderful that some grocery stores are able to stay open 24 hours. The fact that many people work long or unusual hours during the holidays makes it wonderful that stores of all types have provisions to be open and accommodate shoppers through expanded hours both before and after their regular times.
But, the idea that any customer is going to have a gift or fashion emergency and need to run out and get an Alfani blazer or Vera Wang perfume at 4:00 am is pretty silly. This announcement by Macy’s is designed to generate buzz and free advertising (courtesy of the news media) that they so badly need at this time but it is not likely to result in any real sales benefits toward their bottom line. The added costs of security and staffing plus mistakes caused by worker fatigue may actually make it a net loss in revenue for them. Only time will tell whether it was a wise trade-off.
It’s a worthwhile experiment for Macy’s to try this in one of its high-volume urban locations. There will be a lot of “learnings” between now and Sunday evening:
1. Does it drive incremental sales?
2. Does the PR buzz itself make the location a magnet for consumers who might otherwise shop different mall anchors or stores?
3. Do the added operational costs (especially payroll) offset the volume gains? And how much payroll is “enough” at 3am with no history to use as a guide?
4. How does the store deal with issues of replenishment and recovery that might otherwise be handled overnight?
No question that we can expect to see imitators next year, not only from selected department store locations where the conditions are right but also from big-box competitors who like what they see and feel they can execute even better. It all depends on whether this experiment delivers incremental, profitable sales.
Why not make it easier for consumers! We can already shop 24/7 online so there is a competitive issue at play here. I personally like to touch and feel the gifts I am giving to loved ones, so in this time starved world we are racing around in, this may actually work!
If it is successful, look for all the stores around Macy’s in shopping malls to have a decision to make about matching the openings.
Macy’s is considering round-the-clock operations during the Christmas season. While we admire Macy’s innovative spirit, I don’t think Macy’s mass marketing, self-service model will work very well. Think about the staffing and security concerns. Could they figure out a more effective technique without having to fully staff the store?
Let’s look at who might be in line at 10pm when the extended hours kick in. First in line will be the last minute shoppers. Right beyond will be the crowd averse posing as a last minute shopper. Next will be the day shift or two job workers. Followed by the insomniacs. Last in line will be the homeless looking for a warm place for the evening.
Macy’s should follow more effective strategies for each. For the last minute shoppers, Macy’s should offer personal after-hour, shopping service. If the store is only open to personally escorted patrons, Macy’s doesn’t need the full staff complement. Sign up for the service in advance.
Crowd averse shoppers should be served by Macys.com. Macy’s should have a dozen Internet terminals near the main doors with personal shoppers assisting them. Keep these folks out of the stores. There’s no telling what they’ll do.
Day shift and two job workers are not good prospects for all night shopping sprees. They need to be home catching some winks. If they show up during the extended hours, take them over to the Macys.com web site and show them how to shop online. Otherwise, offer personal shopping services.
Insomniacs? Offer them a cup of coffee and personal shopping service.
Homeless? You don’t want them roaming your store, unescorted, at 2 am trying out mattresses.
Good luck. Macy’s Queens. But don’t expect us to be there shopping. We’ll be snug at home, fast asleep.
I got a chuckle out of the “retired public school teacher” using the word, “ain’t.” I guess the good news is that schoolchildren are no longer exposed to her.
To the issue at hand, however, what took them so long? Round-the-clock retail operations are nothing new, and to me the amazing thing is that this is considered such a novelty. One question I have is, is every department going to be open? For instance, in 24-hour supermarkets, the deli, bakery, pharmacy, coffee shop, service meat counter, and other departments shut down (and turn out their lights) during the evening hours. Shopping in these stores in the wee hours is a little spooky. Will Macy’s maintain a Christmas “feeling” by making ancillary departments available to shoppers — like gift-wrapping, watch repair, returns, wedding registry, snack areas, etc.? Or, will it be spooky?
It would be very surprising if Macy’s attempted this without having considered all the problems raised here, and more. Perhaps they saw them more as challenges. It has also been noted that supermarkets have been staying open 24 hours for quite some time. It can be done and strikes me as a sensible and innovative approach which may attract more customers throughout the year, not just this week. In my totally unscientific observations in NY last week, on the subway and walking the streets of Manhattan, more people were carrying bags from Macy’s than any other single store (except possibly Brookstone). Whatever difficulties they may have had this past year, as discussed regularly on RW, there still seem to be a lot of people spending their hard earned bucks at Macy’s. More power to them.
It’s all getting a little sad isn’t it? Retailersstart to merchandise for Christmas months and months in advance, getting earlier every year, and still some retailers feel the need to open longer hours to satisfy customers who haven’t reacted in time!
I’m sure this will be relitively succesful, because many people, especially in area’s where stress related jobs don’t allow time for adequate shopping, simply leaving it late.
Whether or not it is a financial success against salary and additional costs, we will have to see. This will then result in whether or not Macy’s and other stores conduct a similar exercise in future years.
When supermarkets commonly went to 24 hour operation years ago, a common rationale was that night crews could straighten the shelves, clean and restock, so the costs of the extra hours open to the public would be moderated. The night crew could be trained as cashiers, yet also work at other tasks when the customer traffic is minimal. Perhaps Macy’s has a similar strategy. The biggest problem: staffing.
Most people don’t like to work the overnight shift. What’s less popular: changing people’s shifts so their sleep cycle gets disrupted. The first week or so, people get tired and cranky. So changing shifts for a short period can make morale worse.
What’s odd about this: Macy’s Manhattan is a world-famous tourist destination. If there’s a place to try extremely late hours or even 24 hour operation, wouldn’t that be a better market?
Sounds like Christmas just came early for some shoplifters! As someone who wouldn’t want to shop or work in the middle of the night, you have to credit Macy’s for trying different things this holiday. If you think about it, they probably aren’t going to be open that much more than a lot of malls around the country. Some malls will open at 7:00 a.m. on Saturday and stay open until 11:00 or 12:00 p.m. so why not stay open? My only advice is to bulk up on loss prevention staff; they’re going to need it.
From a marketing perspective, Macy’s has achieved an increased “share of mind.” By doing something never done before, they get press and publicity. By doing it in one store, they keep the costs down.
All the operational and executional points raised by other contributors are right on, and I think, almost certainly something Macy’s was aware of. Whether these issues have been addressed effectively is another question, but time will tell.
I am going to believe that this really is about customer service. Yesterday I read that last minute shopping is expected to be at an all time high this year. So staying open 24 hours, given that expectation, is a customer service. There is almost no way that it can be a profitable thing to do, operationally.
OK, trust outweighs skepticism. Good for you Macy’s!
Green stamps were once a novelty until most every one had them and it was so saturated that now they are gone. They were once an early form of loyalty programs (which even then weren’t really creating loyalty). Twenty four hour operations in supermarkets were once a novelty in years past – now are common place. Opening at 5:00 AM on ‘Black Friday’ was once a novelty that has now backed up to 12:01 AM. Some novelty now, right?
All of the issues that have been mentioned are valid. The only issue that hasn’t been made is differentiation. What does this do to differentiate Macy’s? My thought is not much. Whether it works or not they are probably hooked into it. Others will imitate whether or not it works. So, there is little chance that other than this one instance, this has little opportunity to create any point of differentiation for Macy’s. When all else do it next year, who will really remember that Macy’s was the one whom started it in the first place?
Certainly Macy’s can be applauded for trying something if trying anything is worth praise. What’s missing is a reason for the consumer to either come during off hours or a reason to shop there in the first place. Further blurring points of differentiation between Macy’s, other department stores, and other mass merchants offers Macy’s any strategic value for the future.
Offering consumers a reason to visit Macy’s isn’t done by the hours that they are open. It would be done by Macy’s offering goods, services and equally as important an experience that can’t be matched elsewhere. I’m sorry, but a ‘spooky’ trip through a half open department store just isn’t the type of offering with mass appeal. I question whether or not it even has incremental appeal to anyone other than the common shoplifter.
This strategy and its success will presumably be measured by the additional revenue it will generate. As noted in the responses to date, the challenges of staffing, shoplifting, loitering, and general customer service in a department store at 2:00am are going to be difficult to overcome. This strategy just seems to be yet another ‘operational-centric’ decision that appeases the system and not necessarily the customer.
Perhaps Macy’s should develop a creative promotion and method of communicating after hours online shopping in-store during business hours. Their customers (and Macy’s margins, and hence shareholders) would be far better served.
It isn’t how long the retailer is open, but what occurs during the consumer and sales associate encounter.
By the way, and with all due respect to the eastern part of the U.S., the retail approach is a little different elsewhere.
Macy’s and Nordstrom in NYC have different marketing efforts than in a Chicago, or the West Coast market. Hmmmmmmmmmm
Excuse me, but this is just a mess. The problems with around-the-clock operation have been well outlined above and does Macy’s REALLY need to muddy the waters of the respectability and status of a “department store” by operating in even MORE of a Wal-Mart standard? A 24/7 operation is NOT the solution for poor merchandising, poor service and lack of excitement and enticement by a combination of the above, and advertising strategy/campaign as well as store ambiance. I don’t mean to single out Macy’s here either and I don’t want to be mean but BE a DEPARTMENT STORE. Operate as you should AND CAN and that will solve your problems so that outlandish and poor solutions will not have to be attempted.