Tuesday, August 22, 2006

macy's marches on

NEW YORK (AFX) - An analyst said Tuesday Federated Department Stores Inc.'s integration of May Co. Stores into its Macy's brand is working so far.

Federated acquired May Co. last year. The company expects to finish converting the May Department Stores to Macy's by September, making Macy's the first nationwide department store chain.

"Although Federated's major re-branding strategy does not kick off until Sept. 9, we have received early indication that integration of the May stores to the new Macys format is performing well," wrote Merrill Lynch analyst Stacy Turnof in a research note Tuesday.

Merrill Lynch surveyed 50 stores, and found that 88 percent of sales associates were "pleased" with the changes and 74 percent of customers have been reacting "positively" to the changes.

"We believe that those customers still loyal to the May brand will change their minds over the next few months as improvements in merchandise and store shoppability become more obvious," Turnof wrote.


  1. While Macy's will be the 1st regional department store to become a national chain, I would think JCPenny and Sears would dispute the assertion that Macy's is the 1st nationwide department store chain. Yes, this is big news for the "Macy's" of the world, but I can find JCPenny and Sears almost everywhere I travel, including Canada...where I know Macy's is not yet located. As for execution of the conversion of the May Company stores...the verdict is still out, and Macys.com cannot seem to keep up with stores that it opens as "new" stores, not those converted from the May stable (try to find the the Macy's Center City Philadelphia store on their website...after 3 weeks being open, still not even acknowledged on the website as existing). Time will tell if the national "Macy's" works!

  2. The logic of this merger has yet to be seen. There have been some incremental increases in merchandise quality, most of the May coupon games have been eliminated, and some of the stores are sporting new cosmetics counters and vendor shops. But overall, the scheduled relaunch will probably be remembered more for picket lines in Chicago than the dawn of a new era of merchandising.

    I think we were all expecting more, and Federated isn't delivering.