Macy's, Inc. (NYSE:M) Q3 2018 Earnings Conference Call - Final Transcript

Nov 14, 2018 • 09:30 am ET

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Macy's, Inc. (NYSE:M) Q3 2018 Earnings Conference Call - Final Transcript

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Presentation
Executive
Jeffrey Gennette

do want to take a moment to give you a sense of how we're looking at these three buckets. So let's start with flagship stores and this includes Herald Square as well as 10 regional flagships. And these are some of the best retail properties in America, and each of these 11 stores are the number one retail destination in the regional market. They have the best that Macy's has to offer. It's really on all senses engagement through fashion, service and experience.

Our next bucket is what we call our magnet stores and these are really represented by the stores that we currently have in our Growth50 group. And when we're looking for a Macy's store or a mall that offers the best of fashion, food and entertainment. This is what our customers look to for magnet stores, those are also where they go for magnet malls. Customers come to magnet stores for expanded selection, including special occasion, dress up for men's and women's, fine jewelry and expanded gift assortment, a wider selection of home. And in 2018, we launched this Growth50 or these magnet stores. The investment approach, we now believe is a scalable formula that as we mentioned earlier, will be rolled out to 100 additional stores in 2019.

And the last bucket is our neighborhood stores. These tend to be smaller. These stores are all profitable and each play an important role in how our customer experiences the Macy's brand. Customers visit their neighborhood store primarily for convenience, for fulfillment of online -- for fulfillment of online orders as well as for basics, things like skincare replenishment or casual wear. We're currently testing four different investment models for our neighborhood stores that are aimed at increasing shopping ease and convenience, including more self service options. And in 2019, we will test and iterate until we land on the right formula to scale the neighborhood stores in our fleet.

So to sum up, a large percentage of our best customers already shop both their neighborhood store and their magnet store and their shopping behavior feedback will inform our store segmentation strategy moving forward. So with that, we're going to open it up for questions.