March 23, 2012
Macy’s Goes All Millennial
It’s a simple proposition really. Retailers looking to grow their businesses, identify demographic groups and then go about delivering on the various marketing P’s to turn the opportunity into purchases. For Macy’s, the current push is among consumers between the ages of 13 and 30 — the Millennial generation.
According to a report by Reuters, Macy’s CFO Karen Hoguet recently spoke about the importance of grabbing greater share of the Millennial market. “That’s a customer who buys lots of other things in the store besides apparel,” she said.
Company research, according to Ms. Hoguet, found Macy’s is not “the store of choice” for older Millennials.
“We believe we have great opportunity to accelerate sales growth among customers in this generation. Doing so requires us to think from the customer’s point of view about our assortments and store experience, and to align our internal resources so we can move quickly and with focus,” said Jeffrey Gennette, Macy’s chief merchandising officer, in a statement. “The Millennial strategy is a natural extension of Macy’s very successful work over the past three years in developing My Macy’s localization, omnichannel integration and customer engagement through MAGIC Selling.”
Macy’s is planning to implement its Millennial strategy in phases over the next three years, including enhancing its fashion assortment and shopping experience in mstylelab (targeted for 13 to 22 year-olds) and Impulse (19 to 30).
The department store chain identified several key points of emphasis including:
Reorganizing its corporate structure: The company is making unspecified changes to speed decision-making and product development. According to a Macy’s press release, “These adjustments will allow central office buyers, planners, marketers, private brand developers, visual merchandisers and support teams to collaborate more closely across functions to execute strategies and drive the business.”
Identifying customer profiles: Macy’s has developed four customer lifestyle promotions for men and women in the demographic with the goal of turning better understanding into improved product selection, marketing and in-store merchandising.
Localizing assortments: The chain will make refinements to its mstylelab and Impulse areas in keeping with the successful My Macy’s initiative.
Utilizing new and emerging technologies: Macy’s plans to engage Millennials through online, mobile and social channel and do so in a manner that it provides a “seamless shopping experience” with the chain’s stores. The chain will use technology such as QR codes, tablets, tap-and-go transactions etc. to further improve the experience.
Engaging with content: Macys.com will make more use of expert bloggers on the site to offer advice and engage with Millennials. Microsites will focus on fashion developments while providing tips and information about Macy’s events.
Improving the in-store experience: Macy’s is planning to make changes to store layouts and make better use of signage and technology to make it easier to shop its stores. The chain is investing in training to raise the performance level of store associates.
BrainTrust
Recent Discussions
Discussion Questions
Discussion Questions: What makes Millennials different from other demographic age groups? Do Macy’s plans address those differences in a practical way?
Poll
Macy’s is the choice of those with a coupon.
Millennials are more tech savvy with a strong urge for immediate acquisition and they have the wherewithal on how to attain their self-ascribed objectives.
Macy’s knows that millennials have a long buying life ahead of them before they tone down. Macy will focus on addressing the uniqueness of Millennials to capture a greater share of their business, today and tomorrow.
Baby Boomers to millennials; they all have their own make-up (in very general terms). Several areas impact why a group grows up with some similar traits. They include the economy, technology, and war and politics to name a few. Macy’s is smart to take notice of this opportunity with millennials and attempt to do something about it. Updating stores, aggressively incorporating mobile, web and other omnichannel communication is important and resonates with millennials.
What Macy’s has accomplished in the last 3 years is impressive and I am excited to see what they do next.
This is ridiculous. I thought Macy’s was trying to raise its game and use its customer-level data more effectively. Haven’t they learned that demographics don’t matter very much? Why fall back to the bad old way of doing business when they can better understand and target the right customers with the right merchandise and message?
Come on retailers — wake up and smell the data!
Macy’s has already managed to alienate much of their existing customer base by an overemphasis on their own brands and discounting, so they have to try to appeal to a newer customer group. I think they will find that millennials are more likely to buy online.
I’m with Bob Phibbs. The Macy’s closest to me looks like a badly organized T. J. Maxx. Everything is on sale, triple-couponed, special Wednesday priced, etc.
Please, let’s remember, you have to crawl before you walk and walk before you run. What makes the Millennials different? They’re young, often single, often under-employed … oh, wait … underemployed.
Hey, they’re Macy’s target market already … maybe they need a discount!
If Macy’s wants to be the choice of the millennial generation they’re going to have to slay Forever 21 first, and to do that they’ll have to slash prices and achieve faster turns.
I agree with Bob and intend to use my 15% coupon went I purchase my new navy blazer that is already at 40% off.
Anybody at Macy’s read the Forbes article: “Why Big Retail is Running Scared Of the Millennial Generation”?
Economic and generational realities are changing consumption across all demographics. Boomers are stocked up, and Millennials are unemployed and broke.
The question posed wasn’t about if this is a bad idea, it was about what makes them different. Informed from data and leveraging what Millennials give you that other customer segments do not — feedback, “should” improve their merchandise mix and promotional strategy. Heavily reliant on discounts and credit card marketing, it’s going to be a challenge to influence a 13-17 year old, unless they are shopping with their preferred house or co-brand card. Lots of competition in the mall, but Forever 21 is not a price/value match for Macy’s Apparel.
Older and younger millennials are different from one another. Both are different from boomers. The same price point, taste, and choice of stores is not the same for all three groups. Will targeting one group mean losing one or two of the others?
My Macy’s is a real strength for Macy’s. Not only do they target millennials well, they also segment fast growing segments within the millennials bunch. For example, Hispanic millennials represent 21% of the 12 to 34 age group. And they are growing. 15% growth between 2006 and 2011. Compare that to the flat growth rate of non-Hispanics. Hats off to CEO Terry Lundgren.
While all the steps outlined above are the text book right steps, the challenge with millennials is getting the brand right. With this generation, their respect has to be earned. They want to know that the brand values them, looks for their input, gives something back to them. Ponder that, Macy’s, and you might be able to capture some of that market.
Loved this line from Peter; “wake up and smell the data!” Brought up all kinds of imagery for me (maybe just my Friday mindset).
Macy’s (along with several notable others) has realized that what they are seeing from Millennials is foretelling their doom if the current trajectories remain unaltered.
Their move to all things digital (bloggers, QR codes, micro sites, etc.) may or may not help acquire more Millennials in the short term. Either way, I agree with Peter that the future will be won by those that use data/analytics to drive to new levels of precision — acting at an individual level not at the traditional demographics level.
The question is confusing in that it doesn’t specify whether it means “how is a 13-year old different from a 50-year old?” vs. “how is a thirteen-year old today different from one in the past?” Of course the former is rather silly, so I’ll assume the latter: obviously tech knowledge and the whole…ummm …loathsome Facebook/social media angle; it’s not so much oldsters are divorced from this, it’s that the youngsters know nothing else (or at least that’s this oldster’s [admittedly shallow] perception). Macy’s itself has the problem that the department store model has been declining for years — except where it hasn’t, like Nordstrom or Von Maur — and the fear is that it has become not so much the choice of a specific age group (e.g. 30-50 year olds) as it’s the choice of people born at a specific time — i.e. it’s just an unchanging group of [aging] people who are slowly dying off. I guess these periodic press releases — which basically tell us that M engages in normal business practices — are meant to reassure us that they’re not Sears…yet.
I know not a single millennial who would would admit to shopping in a Macy’s store — nor any who aspire to shop at Macy’s but just can’t afford it right now. Macy’s putting out a press release to say they’re going to be the shopping mecca for millennials is very different from getting actual millennial shoppers to bust down Macy’s doors.
It’s nearly impossible to keep up with Macy’s “next big thing.”
Who doesn’t have to keep filling the funnel? Always better to capture them early and then keep them.
Right.
But winning with mom is more important than daughter. How is the selling model relevantly segmented? Which lifestage at which lifestyle? Therein lies the rub. Good luck to Macy’s now trying to sort that out on a national platform.
Or as we like to say, “Retail ain’t for sissies.”
They lost me at the top line piece of the strategy: “reorganizing corporate structure.” Chase all the stakeholders down that rabbit hole and one may never hear of “identifying customer profiles” again. Also, notice the plurality of “profiles.” One? Two? Sixteen gazillion? Alas, another indication that business intelligence is often something of an oxymoron.
Is it just me? Or, did I miss something here? Wouldn’t all of these things be beneficial to any generation?
I had not been a huge Macy’s fan. I suppose it was a bit of a regional bias due to the two acquisitions that left us with them. I was also not thrilled with their advertising and how focused it was on the “Celebrity” product promotions. As a result, I avoided them to a certain extent with the exception of them being the best provider of fragrance and service in that area. Over the holidays, I visited three Macy’s. Two were local and one was in another region. I found a completely different store than their marketing had given the impression.
So what’s the point? From my view, they overwhelmed me in the “experience” area. The last item the article was in my view the most important and they’ve truly done that. All three stores were very easy to shop. They had presentations that were appealing and unexpected based on my expectations. Their service and help were nothing less than spectacular.
Now, what’s so surprising? All of those that helped us were long-termers. They had been through the acquisitions and lived other cultures. All of them expressed that they loved the “Macy’s difference.” Surprised? I was. They won my holiday award of the year. They also won several return trips for other purchases following the holidays.
All of the items are important. I’m not a Millennial, but all of the factors mentioned would be important to me. So, Macy’s, do what your doing, but not just for one, do it for all. I gave them my holiday shopping award based on experiences. I would give them my most improved award based on the same. “Experience” is generational, not just generation.
The interesting thing to note here is that Macy’s has chosen to redefine Millennials for its purposes. It is accepted that Generation Y consists of those 19-30. Extending the definition to begin at age 13 includes “tweens” and the dynamic of the approach to Millennials is therefore changed.
Maybe Macy’s is not comfortable with an emphasis on tweens, preferring to use a broader label.
In any event, this announcement strikes me as something most retailers are already engaged with, i.e. using mobile and social technologies to engage with a younger customer set.
I agree with Bob Phipps; I will only shop at Macy’s if I have a coupon. However, having said that, Macy’s is the only store in my area for my age group- over 60 and my size — Plus.
I would shop more often if the clothes looked better, they weren’t jammed on the racks like my local Salvation Army, and I could actually see them; the lighting is horrible.
There is another Macy’s about an hour away that is so much better, but I am not going to drive that far just to go to Macy’s, unless I am going on a trip and I want new clothes. I do not NEED anything. But I will spend several hundred dollars on items that actually look good.
I would hate myself if I bought anything at full price, knowing that the next ONE DAY SALE will be soon. They have made it a joke to shop there. I throw most flyers away, including the 20% off — whatever.
Do they know about me? Yes. Do they care? No.
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Macy’s is the choice of those with a coupon.
Millennials are more tech savvy with a strong urge for immediate acquisition and they have the wherewithal on how to attain their self-ascribed objectives.
Macy’s knows that millennials have a long buying life ahead of them before they tone down. Macy will focus on addressing the uniqueness of Millennials to capture a greater share of their business, today and tomorrow.
Baby Boomers to millennials; they all have their own make-up (in very general terms). Several areas impact why a group grows up with some similar traits. They include the economy, technology, and war and politics to name a few. Macy’s is smart to take notice of this opportunity with millennials and attempt to do something about it. Updating stores, aggressively incorporating mobile, web and other omnichannel communication is important and resonates with millennials.
What Macy’s has accomplished in the last 3 years is impressive and I am excited to see what they do next.
This is ridiculous. I thought Macy’s was trying to raise its game and use its customer-level data more effectively. Haven’t they learned that demographics don’t matter very much? Why fall back to the bad old way of doing business when they can better understand and target the right customers with the right merchandise and message?
Come on retailers — wake up and smell the data!
Macy’s has already managed to alienate much of their existing customer base by an overemphasis on their own brands and discounting, so they have to try to appeal to a newer customer group. I think they will find that millennials are more likely to buy online.
I’m with Bob Phibbs. The Macy’s closest to me looks like a badly organized T. J. Maxx. Everything is on sale, triple-couponed, special Wednesday priced, etc.
Please, let’s remember, you have to crawl before you walk and walk before you run. What makes the Millennials different? They’re young, often single, often under-employed … oh, wait … underemployed.
Hey, they’re Macy’s target market already … maybe they need a discount!
If Macy’s wants to be the choice of the millennial generation they’re going to have to slay Forever 21 first, and to do that they’ll have to slash prices and achieve faster turns.
I agree with Bob and intend to use my 15% coupon went I purchase my new navy blazer that is already at 40% off.
Anybody at Macy’s read the Forbes article: “Why Big Retail is Running Scared Of the Millennial Generation”?
Economic and generational realities are changing consumption across all demographics. Boomers are stocked up, and Millennials are unemployed and broke.
The question posed wasn’t about if this is a bad idea, it was about what makes them different. Informed from data and leveraging what Millennials give you that other customer segments do not — feedback, “should” improve their merchandise mix and promotional strategy. Heavily reliant on discounts and credit card marketing, it’s going to be a challenge to influence a 13-17 year old, unless they are shopping with their preferred house or co-brand card. Lots of competition in the mall, but Forever 21 is not a price/value match for Macy’s Apparel.
Older and younger millennials are different from one another. Both are different from boomers. The same price point, taste, and choice of stores is not the same for all three groups. Will targeting one group mean losing one or two of the others?
My Macy’s is a real strength for Macy’s. Not only do they target millennials well, they also segment fast growing segments within the millennials bunch. For example, Hispanic millennials represent 21% of the 12 to 34 age group. And they are growing. 15% growth between 2006 and 2011. Compare that to the flat growth rate of non-Hispanics. Hats off to CEO Terry Lundgren.
While all the steps outlined above are the text book right steps, the challenge with millennials is getting the brand right. With this generation, their respect has to be earned. They want to know that the brand values them, looks for their input, gives something back to them. Ponder that, Macy’s, and you might be able to capture some of that market.
Loved this line from Peter; “wake up and smell the data!” Brought up all kinds of imagery for me (maybe just my Friday mindset).
Macy’s (along with several notable others) has realized that what they are seeing from Millennials is foretelling their doom if the current trajectories remain unaltered.
Their move to all things digital (bloggers, QR codes, micro sites, etc.) may or may not help acquire more Millennials in the short term. Either way, I agree with Peter that the future will be won by those that use data/analytics to drive to new levels of precision — acting at an individual level not at the traditional demographics level.
The question is confusing in that it doesn’t specify whether it means “how is a 13-year old different from a 50-year old?” vs. “how is a thirteen-year old today different from one in the past?” Of course the former is rather silly, so I’ll assume the latter: obviously tech knowledge and the whole…ummm …loathsome Facebook/social media angle; it’s not so much oldsters are divorced from this, it’s that the youngsters know nothing else (or at least that’s this oldster’s [admittedly shallow] perception). Macy’s itself has the problem that the department store model has been declining for years — except where it hasn’t, like Nordstrom or Von Maur — and the fear is that it has become not so much the choice of a specific age group (e.g. 30-50 year olds) as it’s the choice of people born at a specific time — i.e. it’s just an unchanging group of [aging] people who are slowly dying off. I guess these periodic press releases — which basically tell us that M engages in normal business practices — are meant to reassure us that they’re not Sears…yet.
I know not a single millennial who would would admit to shopping in a Macy’s store — nor any who aspire to shop at Macy’s but just can’t afford it right now. Macy’s putting out a press release to say they’re going to be the shopping mecca for millennials is very different from getting actual millennial shoppers to bust down Macy’s doors.
It’s nearly impossible to keep up with Macy’s “next big thing.”
Who doesn’t have to keep filling the funnel? Always better to capture them early and then keep them.
Right.
But winning with mom is more important than daughter. How is the selling model relevantly segmented? Which lifestage at which lifestyle? Therein lies the rub. Good luck to Macy’s now trying to sort that out on a national platform.
Or as we like to say, “Retail ain’t for sissies.”
They lost me at the top line piece of the strategy: “reorganizing corporate structure.” Chase all the stakeholders down that rabbit hole and one may never hear of “identifying customer profiles” again. Also, notice the plurality of “profiles.” One? Two? Sixteen gazillion? Alas, another indication that business intelligence is often something of an oxymoron.
Is it just me? Or, did I miss something here? Wouldn’t all of these things be beneficial to any generation?
I had not been a huge Macy’s fan. I suppose it was a bit of a regional bias due to the two acquisitions that left us with them. I was also not thrilled with their advertising and how focused it was on the “Celebrity” product promotions. As a result, I avoided them to a certain extent with the exception of them being the best provider of fragrance and service in that area. Over the holidays, I visited three Macy’s. Two were local and one was in another region. I found a completely different store than their marketing had given the impression.
So what’s the point? From my view, they overwhelmed me in the “experience” area. The last item the article was in my view the most important and they’ve truly done that. All three stores were very easy to shop. They had presentations that were appealing and unexpected based on my expectations. Their service and help were nothing less than spectacular.
Now, what’s so surprising? All of those that helped us were long-termers. They had been through the acquisitions and lived other cultures. All of them expressed that they loved the “Macy’s difference.” Surprised? I was. They won my holiday award of the year. They also won several return trips for other purchases following the holidays.
All of the items are important. I’m not a Millennial, but all of the factors mentioned would be important to me. So, Macy’s, do what your doing, but not just for one, do it for all. I gave them my holiday shopping award based on experiences. I would give them my most improved award based on the same. “Experience” is generational, not just generation.
The interesting thing to note here is that Macy’s has chosen to redefine Millennials for its purposes. It is accepted that Generation Y consists of those 19-30. Extending the definition to begin at age 13 includes “tweens” and the dynamic of the approach to Millennials is therefore changed.
Maybe Macy’s is not comfortable with an emphasis on tweens, preferring to use a broader label.
In any event, this announcement strikes me as something most retailers are already engaged with, i.e. using mobile and social technologies to engage with a younger customer set.
I agree with Bob Phipps; I will only shop at Macy’s if I have a coupon. However, having said that, Macy’s is the only store in my area for my age group- over 60 and my size — Plus.
I would shop more often if the clothes looked better, they weren’t jammed on the racks like my local Salvation Army, and I could actually see them; the lighting is horrible.
There is another Macy’s about an hour away that is so much better, but I am not going to drive that far just to go to Macy’s, unless I am going on a trip and I want new clothes. I do not NEED anything. But I will spend several hundred dollars on items that actually look good.
I would hate myself if I bought anything at full price, knowing that the next ONE DAY SALE will be soon. They have made it a joke to shop there. I throw most flyers away, including the 20% off — whatever.
Do they know about me? Yes. Do they care? No.