Genius brand Macy’s topped L2’s Digital IQ Index: Department Stores with a strategy combining aggressive email marketing, Facebook advertising, and a mobile app that doubles as a wallet. Additionally, the brand is in the midst of a four-year $400 million renovation of its flagship store in New York’s Herald Square. As part of the revamp, salespeople in the shoe department are given iPod Touches to view inventory and search for items in various sizes and colors. Floors will also be remodeled to cultivate the idea that Macy’s carries luxury goods as well as mid-priced ones.

Like most successful Department Stores, Macy’s seems to understand that its ammunition against e-tailers is in its brick-and-mortar locations. The brand has been able to leverage its stores as fulfillment centers where consumers can come in to pick up items they researched or coveted online. And in 2013, it expanded the number of retail stores/shipping warehouses from 292 to 500 in a move to beat Amazon in shipping speed and reliability.

Other department stores are catching on. Seventy-percent of brands that were in L2’s 2013 and 2014 Department Stores studies offer in-store returns of online purchases and 53% have enabled in-store pickup.

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And click-and-collect is becoming the norm in some countries, with U.K. leading the pack.

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