Macy's 2003 Annual Report Download - page 10

SIX
Macy’s has experienced something of a makeover.
Already the nation’s best-known
department store, we have extended the
Macy’s name to co-brand Federated’s
regional department store divisions,
established a new Macy’s Home Store
division, introduced a new marketing
approach and accelerated the rollout of
“reinvent” elements to stores across
the country.
The process began with extensive
research on customer attitudes and
shopping behaviors across the country.
We explored where American consumers
are shopping… how and why they’re
shopping… and what they expect
from stores.
As a result, we more precisely defined
the Macy’s core customer. She’s a fashion-
conscious woman between the ages of
25-54. She more often than not works
outside the home, and her household
income averages more than $75,000 a
year. Most are married; about half have
children and her purchase decisions are
defined by her lifestyle.
Macy’s core customer loves to shop.
In fact, she shops an average of 78 times
a year for the categories of merchandise
sold at Macy’s, spending about $5,000 a
year on herself, her family and for gifts.
Ever conscious about what’s “brand right”
for Macy’s, Federated’s business focus is
consistent with four strategic priorities –
differentiated assortments, simplified
pricing, improving the shopping experience
and marketing.
ASSORTMENTS
Macy’s merchandise assortments today
are better edited and more focused. We
are eliminating duplication and clutter on
the selling floor, while also re-introducing
categories and items the customer is telling
us she wants. We’re more aggressively
pursuing new ideas, becoming more
curious and moving faster.
Exclusive private brands are important
to differentiating Macy’s assortments and
delivering value to the customer. New
private brands such as Hotel Collection,
offering luxury bed and bath linens, and
Tasso Elba, a modern traditional men’s
sportswear line, supplement already highly
successful collections from I.N.C, Charter
Club, Alfani, Greendog, The Cellar and
Tools of the Trade. In 2004, I.N.C will
launch a men’s collection, and an exciting
new home accessories line called “Inhabit”
will debut, adding yet another category
of exclusive merchandise under the
Macy’s umbrella.
In 2003, private brands represented
17 percent of total sales in Macy’s-branded
stores. Over time, total penetration is
expected to reach 20 percent.
Macy’s also is attracting exclusive and
limited-distribution national apparel
brands, such as “H” by Tommy Hilfiger,
and new collections from Jones New York
Signature, Lauren by Ralph Lauren,
Michael Kors and Calvin Klein.
Recognizing that merchandise for the
home is a significant strength and
differentiator for Macy’s, Federated in
early 2004 created a Macy’s Home Store
division. Based in New York, this
centralized organization is responsible for
overall strategy, merchandising and
AM ERICA’S
“ WAY TO
SHOP”