Macy's CEO Says Guidance Is 'Prudent'

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Transcript

00:00We are joined by Bloomberg host Romain Bostic who spoke with the retailer CEO Tony Spring

00:05earlier this morning. Romain, thanks for joining. Yeah, Danny. Did you do any shopping?

00:10I did, but not at Macy's. I got to be honest. Yeah. Well, I mean, the interesting thing, I mean,

00:15I did ask him a lot about what foot traffic was. Was there an actual increase? He did say he was

00:19happy with foot traffic, but he also seemed to imply here that a lot of the revenue gains that

00:24they've seen in this most recent quarter was people buying more. So basically bigger tickets,

00:29bigger receipts, if you will, rather than actually more people going in there. But this is also a

00:34company that is, you know, he's doing the conference call now. He's been asked a lot

00:39about how strong this holiday season is going to be. And one of the reasons why you see the shares

00:43down a little bit here is the comp sales growth, while certainly an improvement over previous years,

00:48is still kind of lagging what you would have seen at a company like Macy's in holiday seasons of past.

00:53Remember, this is going to be or supposed to be their best quarter of the year, their fiscal fourth

00:57quarter. You know, going to a physical store seems like a quaint idea, but a strange thing

01:03to do, right? I mean, most of us buy all of our stuff online. How are they doing with that?

01:08Well, I mean, first of all, the average age of a Macy's shopper is over 40. It's like,

01:12you know, late 40s, I think is the average age. So that gives you a sense of one of the challenges

01:15that they're going. I know, I know, Madden, you're still in your 30s. But it would get to this idea

01:20here that there is still a cohort of boomers out there that do want that physical experience.

01:24Macy's obviously is now trying to make sure that their younger generation of Gen Z and beyond,

01:29that they are actually engaged in the physical stores and trying to make them more experiential.

01:33That's the long term story, you know, and that's what he's doing. He's basically taking 350 Macy's

01:38stores, basically going to revamp all of these stores to make them more experiential. He's only

01:42done about 125, 150 so far. They're going to get to the rest over the next year and a half, two years.

01:48It feels like we're in this bizarre world where the retailers who do well, it's because you've got

01:52like Sidney Sweeney to do your campaign or some sort of celebrity. I mean, Macy's isn't doing

01:57that, but it feels like we're in this weird era of collabs and influencers.

02:00Well, it's interesting. And you bring up, you know, obviously what we're seeing with American

02:03Eagle, their shares on fire. I think when they open, they're going to be having their best day

02:06in a couple of months. But it gets to this idea that's a singular brand, right? And Macy's is a

02:11multi-brand retailer in an era where a lot of us go directly to the brands themselves. We connect with

02:16those brands either because, you know, Matt salivates over Sidney Sweeney in that ad or something else.

02:21And the question is, how does Macy's sort of, you know, get that fire? They've had a lot of

02:25collabs with Wicked and other things like that that do get people into the stores, but it's a

02:30much bigger challenge, Danny. Material girl. Material girl. Apparently the fashion brand of

02:36Madonna sells exclusively at Macy's. Yeah. And they have, they've been doing a lot more

02:39exclusive. Fingerless gloves for that kind of thing. Their own private brands as well, trying to get

02:43people in there as well too, Matt. Ryan Seacrest is working with them. Are any of these celebrities

02:47hitting home with you? I would never be like, I love Ryan Seacrest's look and I wouldn't have

02:51wear his clothes. All right. Romain, thanks very much. Looking forward to the close. Romain

02:55Bosick, of course, anchors the close with Katie Greifeld at three o'clock every day.