So says CEO Jeffrey Gennette, who recently spoke about Macy’s performance and changes undertaken during the pandemic at the National Retail Federation’s virtual event Retail Converge.
COVID-19 unexpected impacts to the industry likely hampered the best turnarounds, but Gennette stated, “The headline is Macy’s is a healthier company coming out of the pandemic than we were going into it.”
However, Gennette glossed over some of the tough choices the retailer faced in 2020, including laying off nearly 4,000 employees in June last year. A significant portion of layoffs--2,000--were planned as part of the February 2020 “Polaris strategy.” The company also made a handful of executive changes, as well as moved its headquarters from San Francisco, California, to New York. Shoring up the digital team was a huge focus for the company as it overhauled a number of areas on its digital presence.
“We made big changes with talent,” Gennette said. “Standing up our digital team in New York City has been a huge win, [and they’re] better integrated with all the teams around them. ... We put a huge premium on data and analytics.”
The retailer also brought on a new chief information officer, Laura Miller, in March 2021 as part of its digital strategy to continue bolstering omnichannel sales. In fact, Macy’s is an omnichannel retailer, Gennette said, while noting how the company pivoted during the pandemic while continuing to execute its new strategy.
“We made our stores safer, and launched curbside pickup to meet fulfillment,” Gennette said. “Through this we [optimized] data analytics to really sharpen our offers. And we're just moving faster than ever before. Our metabolism is up. Our experience in 2020 increased our conviction to take bolder actions, to drive business forward as a digitally-led omnichannel retailer.”
As part of its digital transformation, Macy’s is also updating its website on an ongoing basis, with an expected new look for the 2021 holiday season. The new contemporary look aims to attract customers under 40. Additionally, Macy’s improved its search engine to help customers find products better suited to their desires.
While Gennette was bullish on the new investments, putting a $10 billion goal mark on digital sales by 2023, Macy’s turnaround strategy was originally intended to happen over three years. Fortunately, the company’s first quarter earnings of 2021 did outperform analysts’ expectations, with a profit of $103 million, or 32 cents per share, compared to a loss of nearly $3.6 billion, or $11.53 per share, a year earlier.
As states reopen and more consumers return to stores, a number of format categories are picking up steam, Gennette said. And that’s good news for the retailer, as it also opens new store formats in an off-price expansion. With all the changes the company has undergone, Macy’s is still charging ahead with its 2020 Polaris strategy, albeit with some new consumer insights from the pandemic under its belt.