From new formats to game-changing omnichannel strategies, and with the coronavirus pandemic impacting all aspects of the industry, the world of retail continued to evolve in 2020 as a number of leading chains and e-commerce pure-plays launched a range of key initiatives in an effort to enhance differentiation from their competitors.
Housewares and home were a focal point for many of these omnichannel-oriented retailers, which worked with leading vendors to launch new assortments ranging from kitchenware to home furnishings.
HomeWorld’s fourth annual Retailers To Watch, in the November 16 issue, takes a look at eight retailers that have made moves to further strengthen their respective businesses heading into 2021 through a range of initiatives, from new omnichannel directions to new retail formats. Selected by the HomeWorld editorial staff, each retailer selected is taking aim at growing top-level sales in the coming year and placing housewares and home at the forefront of their respective growth strategies.
Macy’s has had to travel a rocky road lately as it confronts a new generation of consumer and an environment increasingly evolving toward digital sales, and then the COVID-19 pandemic. Macy’s has had to rethink its approach to consumers. Over the past few years, the company has launched initiatives, including those involving off-price operations and online programs, to help it adapt to the current marketplace, but the traction that has resulted from its actions hasn’t necessarily turned the corporate fortunes around.
For the last complete fiscal year, Macy’s posted adjusted company net income of $906 million, or $2.91 per diluted share, versus $1.3 billion, or $4.18 per diluted share, in the year prior as comps slid 0.7%. The company has closed stores to boost its financial position but, ultimately, it has to find a way to draw more new customers.
What to Watch
In the second quarter, Macy’s adjusted net loss was $251 million, or 81 cents per diluted share, versus adjusted net income of $88 million, or 28 cents per diluted share, in the period a year previous, with comps down 35.1% and net sales at $3.56 billion versus $5.55 billion. However, the comps actually were better than the company expected, as Macy’s asserted, and adjusted net loss was better than the $1.78 that Wall Street predicted. And digital sales were pretty strong, growing 53% over the 2019 second quarter.
The pandemic may actually help Macy’s win new online shoppers, as consumers explore new virtual vistas while spending more time at home, and so replace the aging Baby Boomers who aren’t driving its sales as they once did. In releasing the second quarter financial results, Macy’s CEO Jeffrey Gennette said the company plans to invest in digital, omnichannel and apparel, even if apparel is a tricky business these days. Macy’s will need to leverage its store base to pace other major retailers who are using physical locations as distribution hubs and pickup points, and it has dedicated two stores to such functions in the holiday season. It also needs to maintain e-commerce momentum and has struck a deal with Klarna, a global payments and shopping service largely focused on younger consumers. If in the year ahead Macy’s generates fresh revenues with such initiatives, it could demonstrate the ship is headed in the right direction rather than foundering. —Mike Duff
2021 Retailers To Watch (click on name for profile)