Macy’s has been suffering from a slump in sales, but it’s hoping a renewed focus on private label brands will improve its outlook with investors. According to Jeff Gennette, chairman and CEO of Macy’s, the goal is to boost private label sales to eventually rake in 40 percent of the retailer’s total business. That would be 11 percent more than the current 29 percent contribution it’s making.
The news comes as Gennette also hopes to improve Macy’s fashion offerings. This strategy, when paired with the department store’s private label push, is aimed at discovering desirable, attractive fashion offerings on the private side and keeping them as an exclusive benefit of shopping at Macy’s — which is easier said than done, of course. Retail apparel brands aim to be fashionable, and for this trick to work for Macy’s, the retailer will have to have the right, fashion-forward merchandise and then make sure the price point matches up.
This job has largely fallen to Molly Langenstein, the company’s new chief private brands officer.
“It is part of our equation for profitability,” Langenstein recently said at an industry event — and it’s a part the chain is heavily promoting through an upgraded advertising push behind those private label brands and by re-centering much of its in-house advertising efforts through streamlined messaging, a focus on both private and national brands carried by Macy’s and a effort to make its entire marketing mechanism simpler and more tailored toward shoppers.
The hope is that all this change will bring Macy’s what it really wants: a return to the status quo in the form of renewed growth. Unfortunately, the climb back to some sense of normalcy will not be short, as Macy’s has many stores on the chopping block in 2018 as it attempts to prune its footprint.
Those store closures are the easier part of the turnaround for the company. The real trick — and challenge in the age of Amazon — is attracting consumers back into the stores they’re keeping open and then getting those customers to open their wallets.
It will be an interesting journey to watch.