Macy’s is gearing up for battle. The chain just acquired Story, an experience-based shop in New York. Though department stores are in decline, Macy’s currently holds the top spot in Gartner L2’s Digital IQ Index: Department Stores. However, last year the retailer lost out to rival Nordstrom, indicating that its continued reign is shaky.
Despite their best efforts to lure shoppers back, department stores are struggling to attract customers and maintain their relevance in an increasingly competitive retail environment. Many, including Macy’s, have turned to deep discounts or off-price offshoots to keep customers coming back. However, the acquisition of Story is a tactic that breaks from the norm.
The physical store breaks from the shackles of traditional department stores with its shape-shifting format, while the evolving concepts hold the potential to cater to more than the usual mall crowd. In addition to an evolving range of themed items every six to eight weeks, Story also offers “experiences” in the form of yoga and cooking classes, something no other department store except Macy’s rival Nordstrom has tried out so far.
However, Macy’s has more to reckon with than other retailers. It’s also competing with Amazon, which continues to expand aggressively into the retail space. In fact, Amazon’s growth since 2010 recently eclipsed the combined 2016 annual revenue of Macy’s, Nordstrom, and Sears. However, Amazon doesn’t sell in-store experiences. Story could be the breath of fresh air Macy’s needs to make department stores relevant again.