Macy’s tried to dress up its announcement of a new strategy to drive profitable growth, but reporters zeroed in on the news that retail chain would close a hundred stores.
The news came Thursday after its earnings release in which it reported sales were down 2% on a comparable-sales basis for the second quarter, year-over-year.
However, the company said its online business has grown at a compounded double-digit rate in each of the past 15 years, placing it sixth on an independently published list of America’s largest-volume online retailers.
Macy’s said it would invest in capacity-building on its sites and apps, improvement in natural language search, faster page loading, and simpler procedures for placing and fulfilling orders. In addition, it will refine Macy’s and Bloomingdale’s successful Buy Online Pickup in Store offering, introduced in 2013, in order to improve speed and convenience of the customer experience.
Macy’s, Inc. president Jeff Gennette said, “We decided to close a larger number of stores proactively so we can invest in a winning customer experience in our most productive and highest-potential locations, as well as invest in growth sooner and more aggressively in digital and mobile.” Gennette is designated to succeed Terry J. Lundgren as CEO in the first quarter of 2017.
The company intends to close approximately 100 Macy’s full-line stores (out of a current portfolio of 728 Macy’s stores, including 675 full-line locations). Most of these stores will close early in 2017, with the balance closing as leases and certain operating covenants expire or are amended or waived.
Macy’s will add new vendor shops in stores and create new in-store events and experiences. Macy’s, Bloomingdale’s and Bluemercury are reinvesting to maintain their “exceptional” growth in digital sales – transactions generated from websites and apps.