Macy's 2009 Annual Report Download - page 4

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PRIVATE BRANDS – Macy’s portfolio of 15 private brands,
including Alfani, American Rag, Charter Club, Hotel Collection,
I.N.C and Style&co., continued to thrive in 2009 and
outperformed market brands. These private brands deliver
outstanding fashion, quality and value to the customer. And
their approach to the marketplace has been strengthened
through the local focus of My Macy’s. In 2009, private brands
exceeded 19 percent of sales at Macy’s.
EXCLUSIVE MERCHANDISE – Beyond private brands, Macy’s
continued to aggressively pursue customer-right merchandise
from market brands that are sold exclusively at Macy’s. This
builds on our success with Martha Stewart Collection, Tommy
Hilfi ger, Donald Trump and others. In 2009, we launched Rachel
Rachel Roy only at Macy’s and signed several new exclusive
deals, including those for Ellen Tracy sportswear (to launch in
spring 2010) and Sunglass Hut eyewear (with a rollout planned
to begin in 2010). Exclusive and limited-distribution merchandise
(including private brands) at Macy’s rose to more than 42 percent
of total sales in 2009. In fall 2010, Macy’s will become the
exclusive department store retailer of Kenneth Cole Reaction
men’s sportswear and a new juniors line called “Material Girl”
being developed in conjunction with Madonna.
DEVELOPING CUSTOMER-CENTRIC APPROACHES – We continue
to learn from the process of analyzing customer behavior
data collected in partnership with the consumer insights fi rm
dunnhumby USA, of which Macy’s is the exclusive department
store client. We have begun to model the shopping patterns
of Macy’s customers so we can better serve each consumer’s
individual needs. This will lead to systematic experimentation
and testing of new marketing approaches in 2010 and the years
ahead. Identifying and acting on consumer insights is integral to
our determination to place the customer at the center of
our decision-making.
SOCIAL MEDIA – Macy’s and Bloomingdale’s enhanced their
presence in social media in 2009 by launching enhanced
programs on sites such as Facebook, Twitter and YouTube.
Active involvement in social media is key to the company’s ability
to interact effectively with a new generation of customers. After
less than six months of implementation of the new strategy,
Macy’s ended the year with nearly 250,000 friends on Facebook.
STRENGTHENED CAUSE MARKETING – Underscoring our
commitment to community involvement, the company
partnered with customers to raise nearly $34 million for
worthwhile causes in 2009 through cause marketing programs.
These included Believe (benefi ting the Make-A-Wish
Foundation) during the holiday season, Come Together (for
hunger relief in conjunction with Feeding America) in the fall,
Turn Over A New Leaf (for the National Park Foundation) in
the spring, and a literacy program (for Reading Is Fundamental)
during the back-to-school season, as well as our long-standing
relationship with the Go Red For Women movement of the
American Heart Association.
COMMITMENT TO DIVERSITY – The company enhanced its
commitment to diversity and inclusion. We created a Macy’s,
Inc. Executive Diversity Council, which I chair. Our objective
is to accelerate the progress we’ve made to ensure that
our people, merchandise, marketing, communications and
community outreach refl ect the multicultural nature of the
customers we serve. My personal commitment to diversity
also includes serving as chairman of the National Minority
Supplier Development Council.
REFRESHED BUSINESS STRATEGY – We ended the year by
updating Macy’s business strategy and brand strategy to guide
the growth in sales and profi tability we have planned for 2010
and beyond. In doing so, we have honed our focus on specifi c
metrics. We have refreshed our four strategic priorities –
Assortment, Value, Shopping Environment and Marketing –
with a new generation of tactics. We are working to create a
culture in our organization that embraces innovation and testing,
an inclusive work environment, the development of people and
collaboration internally and externally.
We salute three key individuals as they retire early in 2010.
Karl M. von der Heyden, an outside director of our company
since 1992, will retire after the Annual Meeting of Shareholders
in May. Vice Chairs Thomas G. Cody and Susan D. Kronick retire
in March after 28 years and 37 years of service, respectively.
All three have made signifi cant contributions to building
Macy’s, Inc. into the retail leader that it is today.
We enter 2010 with great momentum and a renewed sense
of confi dence in our ability to perform well against challenging
objectives, even though we see little improvement in the macro-
economic environment going into the year. Our continued
success rests on our ability to center on the customer through
My Macy’s and more personalized marketing.
We at Macy’s, Inc. have built an organization of talented and
motivated individuals at all levels of our company. I fi rmly believe
we have the best people in the retailing business. It is based
on this strength that we intend to grow the company for the
future and to provide an excellent competitive return for
our shareholders.
TERRY J. LUNDGREN
Chairman, President and Chief Executive Offi cer