Can Macy’s And Other Department Stores Win With These New Tactics?

Department stores may have lost momentum due to declined sales during the holiday season and an overall increase in e-Commerce activity, but that hasn’t slowed down their efforts to pursue growth in 2016. Retailers such as Macy’s are introducing new marketing strategies, including store-within-a-store concepts and pop-ups, to drive customers back into their stores.

As many as 85% of consumers prefer to shop at brick-and-mortar stores versus online, according to TimeTrade. But in order to grow with the ever-changing marketplace, department stores must update the in-store experience. 

Macy’s Targets Millennials

To increase caché with younger shoppers, Macy’s has implemented new strategies that target millennials.


In September 2015, the Macy’s flagship store in Herald Square unveiled the One Below level. As part of the building’s $400 million renovation, the entire lower level was transformed into a unique shopping experience for the millennial generation. One Below is a fresh take on the “juniors” section and features a blend of fashion, food and technology with charging stations, a selfie wall, cosmetics consultants and a brow bar.

“This huge millennial destination was years in the making,” said Tim Baxter, Macy’s Chief Merchandising Officer, in a Women’s Wear Daily interview.  “We are attracting a younger customer and that’s our mission. We have gained market share every year since 2012 and are expecting that to continue to grow by creating a destination like One Below.”

The latest addition to One Below is a pop-up shop featuring Etsy, which is the online retailer’s first foray into the store-within-a-store marketplace. The Etsy space features items curated to appeal to millennials who are looking for more unique and personalized goods. The section will be refreshed with new products every six to eight weeks, focusing on a different theme during each cycle. Items will include handmade stationary, jewelry and home wares from Etsy shops such as Sol de Sur, Meera Lee Patel and Modern Mud. 

Beauty Is Soaring

Aside from millennials, Macy’s also is gearing towards beauty fanatics with the Peach & Lily store-within-a-store and recent acquisition of Bluemercury.  

In November, the department store tapped Alicia Yoon, founder of Korean beauty e-Commerce site Peach & Lily, for a “shop-in-shop” location at Macy’s in Flushing, Queens. This was a smart move for the retailer due to the rise of Korean beauty trends in the U.S.

Macy’s also acquired Bluemercury in 2015, and will open up stores within the department store nationwide, similar to the collaboration between Sephora and JCPenney stores. Unlike Sephora inside JCPenney, the Bluemercury store-within-a-store concept also will offer beauty services, a feature already inside Bluemercury’s existing locations.

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