This Macy’s Is a ‘Petri Dish’ for the Brand

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Sandy Rushing had come down to New Jersey from Worcester, Massachusetts, to watch his alma mater play Rutgers, but now he found himself sitting in a Macy’s, waiting for his friend before kickoff.

The countertop and empty seats he discovered near the store’s central checkout — one of which Rushing now occupied — were a welcome design feature for the weary traveler. Although there wasn’t a sign to indicate that the area was a “Juice Bar,” where customers could rest and charge their devices, Rushing noticed. He was able to get his phone game-ready.

“They don’t have this in Massachusetts,” he says.

He’s right; they don’t have this most places. This particular store, located at the Woodbridge Center in Woodbridge, New Jersey, serves as a “petri dish” for Macy’s Inc., says Diana Paek, Macy’s vice president of talent acquisition. Employees and customers give feedback, which is then tested out in the store within three to four months; if the features are well-received, they will be incorporated into Macy’s 673 stores across the country.

The changes come as Macy’s, among other big-box retailers, struggles to retain customers. With half of all malls across the country expected to close by 2034, retailers are desperately making updates to remain relevant to a new generation of shoppers. Macy’s, in particular, has struggled to capture a piece of the $13 billion cosmetics market, as well as compete with other department stores, such as Nordstrom, and discount retailers like Marshalls and T.J. Maxx.

In order to compete for customers’ attention and loyalty, the Woodbridge Macy’s implemented features such as uncluttered floors, charging stations, a centralized checkout area, and the removal of partitions so customers can see the entire store. Some features, like wider aisles that accommodate strollers, might not be noticeable to every customer. Even Lisa Szustwal, a fourth-grade teacher who pushed her stroller through the Macy’s store while browsing the racks, didn’t realize at first that it didn’t get stuck on the clothing racks but completely cleared them.

Other features, like the newly self-service shoe department, immediately receive customer feedback.

When Kelly Quinn, a paralegal at Iselin, New Jersey-based law firm Stern & Eisenberg, saw the revamped shoe department, she began raving about it to the nearest Macy’s employee.

Quinn came into the store to try on sandals for an upcoming wedding, and although the ones she wanted required a salesperson to fetch them, she was excited over the prospect of not having to wait to try on a pair. About half of the shoes have boxes lined up below the model, similar to DSW, while the other half still require a salesperson to bring out a pair from the back.

“I love the way they did the shoe department,” she says as she secured a strappy silver sandal. “It’s so much better than standing in line waiting for somebody. It’s neat, it’s organized.”

Customer and employee feedback are what drives this experiment. To ensure that corporate is hearing from customers directly, beyond anecdotes shared by employees, Macy’s mounted tablets throughout the stores where customers can answer a brief survey about their store experience for a prize.

Arguably the most noticeable and effective change is the addition of overhead lights throughout the entire store, along with better lighting in the dressing rooms and newly painted walls.

By comparison, the Paramus Park Mall’s Macy’s store, which is about 35 miles away in another GGP property, lacks the additional lighting. The lighting difference between the similarly sized mall anchors is stark.

Some changes in the Woodbridge Center location have made it to other Macy’s stores. Price checkers are omnipresent in both New Jersey Macy’s stores, even in the dressing rooms, and both stores have added “Juice Bars” throughout the floors; however, only the Paramus Macy’s bears large signs that indicate the charging areas.

Other changes to the Woodbridge store include a pickup area for online orders and a personal shopping area — both of which were uninhabited on the last Saturday of September. However, one retail analyst says having an omni-channel approach, like allowing customers to buy online and pick up in the store, can make or break a retailer nowadays.

“About 90 percent of total retail spending still happens inside stores,” Jharonne Martis, director of consumer research at Thomson Reuters, writes in an email. “This approach allows consumers to have a seamless shopping experience, where convenience and value are at the forefront. What’s more, consumers are all about instant gratification. Thus, if consumers feel they can get an item sooner, and [save] on shipment fees, then they will choose to buy online and pick-up in store.”

Macy’s executives seem to be leaning into the instant gratification aspect of shopping, particularly in its beauty department.

With millennials wielding a significant amount of purchasing power in the beauty market, department stores are expected to accommodate customer demands, such as trial stations. Nordstrom has sampling and an educational "concierge" service, along with newly updated makeup counters in many stores, while J.C. Penney has Sephora outlets in its stores. Beyond Macy’s acquisition of beauty and spa chain Bluemercury in 2015, its beauty strategy hasn’t made major strides — until now.

The beauty department at the Woodbridge Macy’s has made the shift to an “intersell” model, says Lisa Kohm, the Woodbridge manager of Impulse, the retailer’s private beauty label.

Rather than having a siloed shopping experience at each brand’s counter, which is the way department stores have traditionally arranged their beauty sections, the model is client-centric. Customers can test out various products — regardless of brand — in the beauty department.

“You want to bring in everybody, and we’re building up the department, not just the brand,” Kohm says. “You feel special. We take the time for you. And it works as a whole. We’re all a team; it’s not just the Impulse team or the Lancôme team.”

For the first time, Macy’s makeup artists will be able to use brushes available for purchase, like the Smashbox Contour & Highlight Brush Collection, Created For Macy's line. “We get to use them on the customers so they get to see how good they are,” Kohm says.

The company is also experimenting with self-service, centered around a gift-boxing area for Impulse. In the center of the beauty department at the Woodbridge Center Macy’s is a glossy display with lacquered boxes in orange, pink, and purple. The boxes have identical-colored crinkle-cut paper inside, and customers are encouraged to populate them with travel-sized products not unlike the goodies that line the checkout queues of Sephora.

“It definitely draws,” Kohm says. “You get to try at a smaller size. I think it’s a great idea. You can find something for $10.”

The emphasis on customers feeling like they are getting a good deal extends to other departments as well.

Part of Macy’s new strategy is the push toward discounted merchandise. Like Nordstrom, which operates more off-price Nordstrom Rack stores in the United States than department stores, Macy’s has doubled down on its discounting strategy to attract budget-conscious shoppers.

A Macy’s employee within the human resources department at the Woodbridge Center says the Backstage and Last Chance floor aims to attract customers away from discount retailers. “Instead of going to Marshalls and T.J. Maxx, they can come here,” she says.

As of July 29th, the retailer’s parent company, Macy’s Inc., operates 45 Macy’s Backstage locations — 38 of which are inside Macy's stores — and plans to open seven more stores by the end of the 2017 fiscal year. After 10 consecutive quarters of negative earnings growth, Macy’s is expected to see its first positive jump in earnings this quarter, writes analyst Martis.

Macy’s Backstage and Last Act are located on the third floor of the Macy’s store in Woodbridge, where customers are told they will not be able to use their coupons.

Although some grumble and head over to the Macy’s at Menlo Park Mall six minutes away, the Macy’s sales associates say that many customers are happy the Woodbridge store isn’t going out of business. Recent construction in the Woodbridge store — the escalators connecting the first and second floors are currently under repair — caused some concern for customers.

Macy’s Inc. announced in August 2016 its intent to close 100 stores, about 15 percent of its department stores, with 68 of those closing in 2017, according to the company’s financial documents. By closing those locations, which “are unproductive or are no longer robust shopping destinations due to changes in the local retail shopping landscape,” according to a January company statement, Macy’s will reinvest in stores like Woodbridge, says Paek.

“We get good feedback now. Our scores have gone up with what customers are seeing because of the changes,” says Kohm. “Upstairs has Backstage. We got rid of some clothing designers. Now people are seeing we’re not closing, we have a lot of nice things, and it’s a friendlier environment.”

The employees are happy with the changes as well.

“[Macy’s executives] went around asking associates what we would change to make better for us,” in addition to the customers, says Zoe Laurent, a full-time support associate at the Macy’s store in Woodbridge. Since then, changes have been made that associates appreciate — from transitioning away from a commission-based salary to a (recently increased) flat hourly wage to allowing employees to wear color instead of the mandated all-black uniform.

“It’s better. You get to wear what you want,” says Laurent, who has worked at the Woodbridge Center Macy’s for the past two years. “We sell different clothes, different shoes. You get to advertise also, because they give us extra discount, too.”

It has yet to be seen if the overarching changes to Macy’s strategy will prove successful, but analysts have a positive outlook on the brand.

“Macy’s has the right ingredients in its new strategy,” writes Martis. “However, what is key is that they attract the millennials and convert them into loyal shoppers.”