Macy’s is continuing to push the roll out of its off-price Backstage concessions, on Tuesday unveiling its Wauwatosa, WI location, the Milwaukee Journal-Sentinel reports. The 20,000 square foot space, taken from its intimates and children’s clothing departments, now features small batches of varied merchandise.
The department store hopes the small quantities and high turnover will drive more frequent visits, Macy’s media relations manager Carolyn Ng told the Journal-Sentinel.
Meanwhile, last week CEO Jeff Gannette bought more than $300,000 worth of Macy's stock at $22.94 per share and Macy's director William Lenehan bought more than $100,000 worth at $22.71 per share, according to separate form 4 filings with the Securities and Exchange Commission, leading some observers to speculate whether the struggling retailer’s stock, which has fallen precipitously in recent years, has hit bottom.
Gennette’s annual base salary, according to a March filing with the SEC, is $1.25 million, with an annual target bonus equal to 170% of his base salary and core long-term incentives of $6.5 million for a target total direct compensation package of $9.87 million — making his buy-up of Macy’s shares last week relatively small potatoes.
Still, major stock purchases from key executives are a signal of confidence, and Macy’s is undergoing a series of changes designed to reverse its diminished fortunes in an unusually tough environment for department stores in general and Macy’s in particular.
It’s an open question whether Macy’s can gain traction with its moves. Along with a correction to its massive U.S. physical store footprint (which involves shuttering at least 100 stores), the company under Gennette is aiming to foster the treasure-hunt mentality that has stoked the success of off-price retailers like T.J. Maxx. To that end, Macy’s is incorporating its nascent Backstage unit into its stores (in stark contrast to Nordstrom, whose off-price Rack stores are distinct from its full-line Nordstrom stores) and revamping shoe sales to “open-sell” racks reminiscent of off-price stores.
It’s also not clear whether these efforts have legs, though Howard Davidowitz, chairman of New York City-based retail consulting and investment banking firm Davidowitz & Associates Inc., says Gennette needs some space and time.
“They’re a decade behind in getting into off price — a decade — they just started,” he told Retail Dive. “They’re also going about it differently, they’re going to make it part of their stores. That may work, that may not work. The new guy is very muddled, but he wouldn’t be in this job if he wasn’t talented. I say give him time.”