Macy’s Attempts to Nix Amazon Billboard at Herald Square

Macy's

Macy’s has taken its landlord, The Kaufman Organization, to court over the proprietor’s plan to allow Amazon to advertise on the billboard on top of the flagship store in the heart of Herald Square that is seen by millions every year during the Thanksgiving Day parade, CNBC reported on Wednesday (Sept. 29).

The lawsuit, which Macy’s filed in state court, includes claims by the company that any ads from the online retail giant will cause “immeasurable” harm to Macy’s bottom line, the report says.

“The damages to Macy’s customer goodwill, image, reputation and brand should a prominent online retailer (especially Amazon) advertise on the billboard are impossible to calculate,” Macy’s said in court papers cited by CNBC.

Macy’s advertising lease for the billboard ended in August after more than a half-century of promoting the business in that iconic space, high above one of its most famous locations. In the lawsuit, Macy’s says The Kaufman Organization had been in talks with Amazon before the lease ran out. The original lease on the billboard space included a provision that indefinitely barred other retailers from advertising on the sign, according to Macy’s.

“Macy’s continues to have rights relating to advertisements at that location,” a spokeswoman for Macy’s said in an email to CNBC. “We expect to realize the benefits of these rights and have asked the court to protect them. As the matter is in litigation, the company will not have any further comment.”

Neither Amazon nor the Kaufman Organization responded to CNBC for its report.

Related news: Macy’s Embraces ‘Omnichannel Digital Retailer’ Mantra, But Lags Behind Peers

Macy’s has recently shied away from its standing as the largest department store in the country in favor of being considered a “digitally-led omnichannel retailer.” Macy’s expects to do $10 billion in digital sales by 2023 and will continue to work to improve profitability.

As Macy’s progresses in its digital transformation, company executives said one of its biggest challenges will be meeting customers’ delivery expectations, noting that the lower real estate, payroll and benefits costs in the digital channel will offset the pressure it faces from increased delivery expenses.