When was the last time you ventured out to your local mall because you really, really had to go?
If that question had been asked several decades ago, your answer probably would've been something like "last week" or "I have it on my list of things to do this weekend."
But it's probably not the case anymore.
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Nowadays, fewer and fewer shoppers are making a point to go to their local malls because, simply put, they don't have to.
Thanks to this change, American shoppers are decreasingly brand loyal, which means competition has gotten flatter. Companies must compete based on their merits, pricing power, and perceived popularity above all else.
Malls are no longer considered the gold standard for shopping access and convenience. Thanks to the rise of more suburban strip plazas with comparably impressive inventory and online shopping, getting access to your favorite brands has never been easier.
Thanks to the rise of online shopping, an increase in suburban shopping plazas in closer proximity, and a lot more choices, we don't have to visit a massive indoor shopping mall to gain access to the stuff we used only to be able to get by driving 30 minutes, parking in a huge garage, and meandering through stores for half a day.
Macy's has been hurt by flagging mall interest
This has especially hurt legacy mall retailers like JC Penney and Macy's (M) . Once the high-flying anchor stores of mall culture, these retailers are now more or less shells of themselves, paying outsized rents for less and less access to foot traffic and deal-hungry shoppers.
Obviously, this is not a sustainable business model. Macy's has been outspoken about a revitalization plan, saying it will shutter about 150 stores by 2026 to turn around sales and shore up profit.
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It's also gone on the offensive by offering what it hopes will be enticing new deals; it's begun to revitalize in-house brands like children's label Epic Threads in the hopes of attracting loyal customers seeking value-based, exclusive brands.
Macy's has launched or re-launched several other brands in its revitalization effort, including On 34th and State of Day. It plans to launch an unnamed menswear collection in 2024 and another kids' line shortly thereafter.
Macy's betting big on luxury product line
But relaunching old standbys isn't the only part of Macy's big rethink. The mall retailer is reportedly diving deeper into famously high-margin luxury lines to capture customers with a little more money to spend.
The retailer says it will refocus its efforts on designer fragrance, which still carries highly sought after labels like Dior and Chanel but come with a more accessible price tag than, say, a handbag by designer labels.
“Fragrance is that attainable, end piece of luxury,” Nicolette Bosco, VP of beauty at Macy’s said. “[Fragrance] is a lot more attainable than, let’s say, a $5,000 something else from the brand.”
“In probably the last three years coming out of Covid, we have been highly focused on elevating and bringing this luxury experience of beauty to our consumers,” she added.
Some Macy's stores have already begun stocking high-end fragrances by designers like Cartier, Tom Ford, and Creed. But the mall retailer is planning to ramp up its designer fragrance presence, unveiling a plan to expand its luxury beauty offerings -- with a sharp focus on fragrance -- into 42 stores by the end of 2024.
Macy's says it will offer mini store-in-store concepts, similar to what Target has done with Ulta and what Kohl's has famously -- and successfully -- implemented with Sephora.
“Where we’ve evolved is in bringing collaborations, and what I like to call ‘retailtainment’ — my CEO calls it retail theater. And we have that ability because we have the space to do those different types of collaborations,” Bosco said. “I do see this as part of our forward growth of what we will be bringing to the consumer.”
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