Is middle-market Macy's ready to go uptown?
Chain to open revamped Chestnut Hill shop and test upscale strategy
Can the middle-market Macy's attract an uptown crowd?
On Thursday, the department store will find out when it opens the doors at its new Chestnut Hill location, where it plans to woo area fashionistas with top designers and brands -- from Tufi Duek to Jane August -- that can't be found at any of the chain's other locations.
The new shop, one of Macy's 10 most upscale stores, aims to take advantage of the region's flush disposable income and compete with a growing bevy of luxury retailers in Boston. Located in a former Bloomingdale's off Route 9, the Chestnut Hill Macy's is one of the chain's only shops to feature a full salon and spa with waxing, facials, and massage services.
At 130,000 square feet, the store is smaller than most Macy's and doesn't carry juniors', children's, or home goods. Still, there's room for $250 Versace sunglasses, $360 Christopher Kon leather purses, and $395 Donna Karan red trench coats.
"We want to make this a destination store," said Macy's spokeswoman Elina Kazan . "Having a free standing store allows us the opportunity to experiment and be different. This is geared more toward the fashion customer looking for the newest thing, designer labels, and boutique brands."
The store unveiling comes just months after Federated Department Stores Inc. converted local chains it recently bought, including Filene's, into the Macy's brand it already owned. With the launch of a national advertising campaign last fall, the 800-plus Macy's empire has attempted to appeal to a well-heeled customer with upgraded merchandise and enhanced store designs. In the retail hierarchy, Macy's is considered a middle-market department store chain, above Kohl's and J.C. Penney, but below Nordstrom and Neiman Marcus.
Opening a premier Macy's in Chestnut Hill reinforces the chain's upscale strategy and acts as a halo for other Macy's, according to Madison Riley , a principal with retail consultancy Kurt Salmon Associates in Boston.
"For those who shop at Macy's in this marketplace and have higher taste levels, they'll be even more surprised at where Macy's is today," Riley said. "It's a good strategy to support Macy's effort to refine and elevate their brand."
The success of Bloomingdale's -- Federated's other chain -- and the area's affluent population made Chestnut Hill an obvious place to locate a fancier Macy's, according to Craig Davis , store manger for the Macy's in Chestnut Hill. The company expects to draw customers from Boston to Natick and beyond.
Recently, more luxury retailers have flocked to the region including a new Barneys New York store, which opened last year. Neiman Marcus will open another shop in Natick later this year, and Nordstrom is planning to move into the market with several locations.
After years of losing market share to discounters and specialty merchants, department stores have been staging a comeback over the past year. Sales are up 4.5 percent for department stores, compared to only 2.5 percent for discounters, such as Wal-Mart Stores Inc., and only 1.1 percent for apparel chains, according to the International Council of Shopping Centers.
Still, sales at existing Federated stores lag behind some of its competitors, including Kohl's and Nordstrom. In an earnings call earlier this week, Federated also reported disappointing sales at former May Department Store chains, such as Filene's and Marshall Fields.
"Sales at the May doors were weaker than expected. We are doing the right things in these new stores, but it has taken longer both to build a customer base and also for sales associates, store executives, as well as customers to get used to the changes," Federated chief financial officer Karen Hoguet said in a conference call.
Federated, which is proposing to change its name to Macy's Group Inc., did not provide specific sales figures for the former May stores.
"There are still die-hard loyal Filene's fans. They just have to give us a chance," Kazan said. "It's a transition."
Inside the brightly lit store in Chestnut Hill, artwork and chandeliers adorn the walls and ceilings and plasma televisions hang in the spacious fitting rooms, which are complete with leather couches. Designers from Stuart Weitzman to Donald J. Pliner are prominently displayed in the roomy shoe department. Some of the brands featured in the store overlap with ones carried by its sister chain, Bloomingdale's -- but also rivals like Saks Fifth Avenue and Neiman Marcus.
"This is an alternative to Bloomingdale's and other luxury retailers," said Gary Conroy , a Macy's regional vice president. "It's a little more approachable on an everyday basis."
Jenn Abelson can be reached at email@example.com.