After a Mediocre Holiday Season For Macy’s, What’s To Come For 2023?

Last Friday, Macy’s provided a fourth quarter update for the end of 2022 which states their net sales are now expected to be at the low-end to mid-point of the previously issued range of $8,161 to $8,401 million. While inventory levels do not raise concerns, the macro economic pressures consumers are facing such as inflation, rising interest rates and increasing unemployment rates point towards a more cautious consumer spending in retail stores. Macy’s warns that after a mediocre holiday season, the first half of 2023 may reap similar results unless a re-acceleration in consumer spending happens before the spring selling season.

Top 3 Takeaways from Macy’s Business Report :

1. The inflation pressure Macy’s has noted has more of an impact on them because they mostly sell discretionary vs retailers such as Target and Walmart that also sell food and consumer packaged goods.

2. With the majority of Macy’s sales reflective of retail foot traffic since they are still mostly a brick-and-mortar retailer, they are tracking behind as overall retail continues to more to eCommerce

3. Macy’s is a much smaller retailer in terms of revenue and market capitalization (5B) than Target (70B) and Walmart (380B), and therefore is not the best indicator for the larger retail market.

It comes at no surprise that consumers continue to shop conveniently regardless of the pressure of inflation and other economic factors. Smaller retailers such as Macy’s, JCPenny’s and Kohl’s will need to pivot and adjust to try and meet consumer demands if they look to stay competitive. In a recent article we covered the economic hardship retailer, Bed Bath and Beyond is also facing as more brands move away from low volume retailers and re-strategize their focus around eCommerce growth.

To learn more about online marketplace capabilities and how POTOO can help your brand achieve your marketplace goals message us on LinkedIn or contact us at info@potoosolutions.com to be connected with an eCommerce specialist today!