Merchant Innovation

Can Tweaking Discounts Save Macy's Sinking Ship?

It wasn't too many months ago that Macy's put a full-court press on to put more discounted products in front of more customers. However, it seems now that the retailer is changing course yet again.

The Washington Post reported that Macy's is set to announce a few updates to its discounting policies, with the most notable being that the retailer will no longer accept coupons for items that have already been marked down. Coupons will still be accepted for full-price merchandise, with the idea being that if customers are offered a low and transparent price, they'll be more likely to pull the trigger. This committment to making bargain hunting easier is also reflected in a design change for Macy's stores across the country. Clearance racks will be consolidated to a single area for both men's and women's clothes, instead of being scattered over the floor.

“With this radical price transparency that’s been enabled through eCommerce, this constant visibility to others’ prices, [retailers] just can’t afford to play games,” Carol Spieckerman, strategist at Spieckerman Retail, told The Washington Post. "Shoppers are on to their strategies, and they’re annoyed.”

Macy's CFO Karen Hoguet confirmed on an investors call last week that Macy's is indeed moving toward a place where its customers will hopefully worry less that brick-and-mortar retailers are trying to pull the wool over their eyes with too-good-to-be-true deals. This news comes on the heels of a separate announcement by CEO Terry Lundgren that outlined Macy's plans to open 16 more discounted item-only Backstage storefronts in 2016 alone.

"We are encouraged by the way the business responded going into 2016, and we believe we are well-positioned to stabilize sales levels this year as we lay the foundation for enhanced shareholder value and sustained, long-term profitable growth," Lundgren said in a statement. "Given our determination to rise above our disappointing 2015 performance, I have reminded my team that our setback last year is a setup for our comeback."



About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.