Struggling Macy’s Just Brought In a Billion Dollars Online

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Pete Bellis/Flickr

Macy’s may have had trouble getting holiday goers to visit its huge department stores, but its website and mobile app sure grabbed a few clicks.

Macy’s generated its first billion-dollar month of sales from its digital platforms in December, said Yasir Anwar, group vice president of digital technology for Macy’s and Bloomingdale’s. Anwar, speaking Sunday at the annual National Retail Federation’s convention in New York City, added that Black Friday saw more than half of Macy’s web traffic come from smartphones — another first.

Macy’s no longer breaks out what percentage of its business is derived from digital sources as compared with physical stores, arguing the lines between the two have become too blurred. But, there are several clues to suggest the digital business is growing while the brick and mortar business is shrinking.

“We are buoyed by a very strong performance in our digital business, with continued double-digit increases in online sales,” said Macy’s chairman and CEO Terry Lundgren in a Jan. 6statement. Lundgren, trying to thwart pressure from activist investor Starboard and reawaken a stock price that has plunged 40% in the past year, added, “In November/December, we filled nearly 17 million online orders at macys.com and bloomingdales.com — a new record for our company, and an increase of about 25% over last year — based on significant new fulfillment capacity, site functionality and aggressive digital marketing.

At least Macy’s is able to hang its hat on something in a challenging holiday season.

The company warned on Jan. 6 that same-store sales plunged 4.7% for the months of November and December combined. Same-store sales for its fourth quarter, which runs through January, are seen falling by about 4.7%, worse than previous guidance for a decline of 2% to 3%.

Macy’s also lowered its full-year earnings guidance to between $3.85 and $3.90 a share from its prior expectations of a $4.20 to $4.30 a share range.

The company will close 36 stores by the spring as part of a broader reorganization. After those stores are shuttered, Macy’s will operate about 730 locations in the U.S.

Macy’s did not immediately respond to additional request for comment.

Written by Brian Sozzi of TheStreet 

(Source: The Street)

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