Macy's 2010 Annual Report Download - page 4

Distinctive and Exclusive Merchandise – Customers expect
newness and unique ideas from us in the form of interesting
products they don’t see in other places. In 2010, we launched
a number of exciting market brands exclusively at Macy’s,
including Kenneth Cole Reaction, Sean John men’s sportswear
and Material Girl, a juniors collection from Madonna and her
daughter Lourdes. That momentum will continue in 2011,
particularly as we fill gaps in our assortment (we call this
“white space”) where we are underserving customer needs.
A good example of this approach is the spring 2011 launch of
our capsule collections that will feature rotating merchandise
lines throughout the year from leading designers in Impulse,
Macy’s contemporary fashion department. Also in Impulse, we
launched in early 2011 a new private brand called Bar III for
women and men. In 2010, approximately 43 percent of Macy’s
sales were in exclusive or limited distribution brands and labels.
Included in this total is Macy’s lineup of very successful private
brands, which represented approximately 20 percent of sales
in 2010.
MAGIC Selling – We launched this energized new approach to
customer engagement at Macy’s by training more than 130,000
store associates in 2010, reinforced with a refresher course
in early 2011 and ongoing coaching of associates on the
sales floor. An initiative unprecedented in its size and scope,
MAGIC Selling helps us to better understand the needs of our
customers, as well as to provide options and advice. It is, in
effect, our in-store growth strategy.
Omnichannel Integration – Online sales at Macy’s and
Bloomingdale’s have risen by 20 percent or more in each of
the past three years (including by 29 percent in 2010). But we
believe that the ongoing key to success is the integration across
channels – blurring the line between our stores, the Internet and
mobile technology to the point that we surround the customer
and can respond to her needs no matter which way she prefers
to shop and buy. We have taken action to drive our store
customers online while driving our online customers into the
stores, and using mobile engagement to drive business both
online and in the stores. This omnichannel integration is helping
Macy’s and Bloomingdale’s to develop deeper relationships
with loyal customers who appreciate the convenience and
flexibility we bring to the shopping experience.
STRENGTH AT BLOOMINGDALE’S
Bloomingdale’s performance was strong in 2010 with sales
growth that compared favorably to its upscale competitors.
Meanwhile, the Bloomingdale’s brand continued to expand.
Bloomingdale’s opened its 41st store in 2010 with an exciting
new location in Santa Monica that is smaller and focused on
the more relaxed fast-fashion customer in that market. In the
fall season, a Bloomingdale’s Outlet concept was launched
with four stores in Miami and Sunrise, FL; Paramus, NJ; and
Woodbridge, VA. Additional Bloomingdale’s Outlet stores are
expected to open in 2011 and beyond.
In February 2010, Bloomingdale’s opened in Dubai under a
license agreement with Al Tayer Insignia, a company of Al Tayer
Group LLC. This is the first international location for either
Bloomingdale’s or Macy’s.
INSPIRING OUR ORGANIZATION
An essential ingredient in the culture of growth we are
building at Macy’s, Inc. is the talent, experience, energy and
diversity of our people at all levels. I have said repeatedly that
I believe we have the best and most resourceful organization
in the retailing business. And we have continued to improve
over time in recruiting, retaining and developing the best
person for each position.
More than ever before, we are encouraging teamwork across
functions among individuals with different perspectives
and points of view. We are collaborating closely with our
vendors and other outside partners. Working together, we
are formulating new ideas in every function so they can be
evaluated, tested and rolled out quickly if successful. And
we are encouraging a higher level of risk-taking with the
understanding that growth requires new and often untested
approaches to the business.
The initial success of our newly unified operating structure in
2010 – including the local focus of My Macy’s – has instilled a
renewed sense of momentum in our company. Progress that
once was thought to be beyond reach has become reality. We
are developing the confidence to stretch ever-higher in the
quest to attain and exceed our goals.
Clearly, shareholders benefit when we succeed at motivating
our associates and delighting our customers. Macy’s, Inc. is
committed to maximizing shareholder value as we continue to
evolve as a growth company dedicated to customer centricity.
The Macy’s, Inc. management team and organization
appreciates your support of our company. We look forward
to continued progress in building a dynamic growth company
capable of accomplishing great things.
Terry J. Lundgren
Chairman, President and Chief Executive Officer
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