It should come as no surprise that even a successful department store like Macy’s is still learning and implementing what many would consider a lesson from ‘Retailing 101’. [“With Stores Nationwide, Macy’s Goes Local: The big department store chain lets each store cater to local tastes”, Bloomberg Businessweek]
Recently, Macy’s announced that it would begin working more closely with its stores to allow managers to more closely tailor store merchandise to individual markets. For those of us working in urban markets – the failure of many national retailers to meet the needs of the local market is legendary, and sometimes humorous. I have heard stories from corporate executives themselves about how their stores are sometimes off the mark when it comes to meeting the demands of local clientele. Take the Payless Shoe store on 125th Street. Payless executives had high hopes for the store when it opened. They thought they had done their research. They hired bilingual staff and had bilingual signage to attract what they believed was the core customer base. When the store was not meeting sales projections, no one could understand why…that is until they visited the store. The local clientele was primarily African-American, and while the store was located close to “Spanish Harlem”, in New York, a few blocks can mean skewing towards a completely different type of customer. When Payless took these differences into account and changed their tactics, store sales started meeting expectations. I love this story because it exemplifies the challenges that national chains face, despite their deep pockets, and the opportunties that local retailers have if they pay close attention to their customers. Nothing beats a deep knowledge of the market and the ability to give customers exactly what they want, when they want it, at the right price point.