Macy’s is going after millennials—and it’s not hiding its ambitions.
Last month, the retailer unveiled One Below, a new 53,000-square-foot area in its renovated flagship location in New York City specifically designed to fulfill every millennial’s desire. The space features brands popular with the age group, including Roxy and XOXO, and lots of tech gadgets like Fitbit fitness trackers and a 3D printing shop that can personalize iPhone cases and jewelry. Adding to the millennial-focused decor is an Instagram wall that encourages selfies, bight ornaments like giant flowers and neon lips, and and loud, popular music blasting through the speakers.
The department store is testing One Below with the hope that it will help attract younger shoppers to the location. According to Bloomberg, Macy’s has plans to incorporate parts of One Below into its stores around the nation.
Following the opening of Macy’s One Below, RetailWire, an online retail discussion forum, asked its BrainTrust panel of retail experts the following questions:
- Will Millennials and younger shoppers be attracted to the offerings at the Macy's One Below location?
- Is Macy's investing its resources wisely in trying to court Millennials in this way?
Here are nine of the best perspectives from that discussion. Comments have been edited by Retail Dive for content and length.
1. It’s the store, not the floor
Gene Detroyer, Professor, European School of Economics: The real challenge for Macy's is not to build a location for Millennials. The real challenge is to get Millennials to walk into Macy's. After all, it is Macy's.
You can't look at your customers like they are stuck in time or as a stereotype. These Millennials are the future core of your business. The store has to be appealing, not the floor.
2. Adapt—and fast
Tom Redd, Global Vice President, Strategic Communications, SAP Global Retail Business Unit: Macy's is on the money for the non-maturing Millennials and the Generation Z target. And Generation Z fits that "born and live for electronics" group well — seems like the social networks keep them in "hordes" similar to how zombies (somewhat mindless beings) travel.
Macy's just has to make sure that the One Below space can be reconfigured fast and cheap. Why? Generation Z has more moods than we have ever seen, so if they have a "socially agreed" mood, their retail demands/needs/wants will change and thus One Below may have to go Four Below. Typical horde retailing!
3. Mis-targeted and 'gimmick-driven'
Dick Seesel, Principal, Retailing In Focus LLC: The concept as described sounds like it is mis-targeted if Macy's is trying to draw more Generation Y shoppers into its stores. Yes, these shoppers are more tech-savvy and interested in customization than their parents but are not necessarily driven by gimmicks or club music. You can argue that Apple is the antithesis of a gimmick-driven store.
It's important that Macy's capture the biggest segment of the population (in terms of numbers today, in terms of buying power soon), but this may not be the answer. I think the test results are going to be misleading — again, based on the sheer amount of traffic funneling through the flagship store.
4. Who is the target customer?
Ryan Mathews, Founder and CEO, Black Monk Consulting: Macy's may do a brisk selfie business among tourists, but so do the desnudas in Times Square. Oh, and those Millennials or Gen Z-ers or whatever marketers want to call them next ... they'll figure out One Below is still Macy's.
Nothing screams un-hip more than faux authenticity and nothing doesn't sell more than generational patronization. I'm not blaming Macy's for trying to reach out to younger shoppers, but I am afraid they may have missed the mark here.
That said, there are a lot of tourists in New York.
5. More tests might tell
Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.: This is only the beginning of a lot more testing that needs to be done. Testing some new ideas is great. However, the tests need to be carefully designed and generalizations from the results carefully applied.
6. First, know your customer
Lee Peterson, EVP Brand, Strategy & Design, WD Partners: The idea of creating a much more compelling store experience to attract young people is a good one, but very tardy and very difficult to do in scale unless you've been doing it for a while (like Victoria's Secret or A&F) and with reams of insights into that customer. Neither of which Macy's has.
I'm sure we'll hear about how well the flagship store is doing when it gets rolling, but the key is this: how will it roll out? And even if "elements" of it are successful on a broader scale, [in my opinion], it's still not enough to save the model.
7. Advertising mix-up?
Cathy Hotka, Principal, Cathy Hotka & Associates: Macy's has a huge presence in newspaper advertising which just isn't compatible with its professed desire to excel with Millennials, who don't read newspapers....
8. Get past the 'Ohh and Ahh'
Roger Saunders, Global Managing Director, Prosper Business Development: Not certain that I'm clear on the target audience. If you tell me it is Generation Z, I'd say roll the dice in the basement location. If it is Millennial or Gen X, this is going to be an interesting OooHHH and AaaHHH period for about six months. The Millennial, while not world-wise at this particular stage, is a savvy, sophisticated shopper. They are between the ages of 18-34, not 11-21. Go about this move cautiously.
9. Back to the past
Kai Clarke, CEO, American Retail Consultants: There might be an attraction to Macy's One Below location, but Macy's needs to focus more on delivering some of the same standards that originally made it successful...including improving their offerings, enhanced customer service, and making the customer feel that they are the most important thing once they are in the store.