Not everyone accepts the retail apocalypse. Even as chains such as Claire’s and Nine West declare bankruptcy, and Toys R Us goes out of business, and even as Amazon extends its reach, some influential bellwether retailers are showing signs of life – and then some.

In recent weeks, Kohl’s, Macy’s, Target, and Walmart, which operate thousands of stores between them, announced increases in revenue and same-store sales. All of them benefited from strong sales during the holiday season. But the single-most important factor contributing to their strong quarters and fiscal years: managing their physical locations more effectively.  

Macy’s is a case in point. Here is a retailer that has taken its share of knocks over the past few years amid announcements about layoffs, store closures, and declining market capitalization. But in late February, Macy’s announced same-store sales and holiday results that beat analysts’ expectations. And the company said it expects continued growth in 2018. Why? Because Macy’s is thinking about its physical stores differently. For instance, Macy’s is making the shopping experience easier with mobile check-out and creating stores within stores. A concept store known as Backstage exists inside Macy’s locations to cater to bargain hunters. In addition, Macy’s is leasing some of its store space to other businesses including pop-up stores.

“I think this is a bit of a turning point for the retail sector,” Telsey Advisory Group’s Dana Telsey told CNBC on the heels of the most recent quarterly earnings report from Macy’s. “I think it’s a bigger story.”

Macy’s isn’t the only retailer learning to wring more value out of its stores. For example:

  • Through a relationship with Amazon, Kohl’s has opened up Amazon return counters at some of its locations, which helps Amazon deal with one of its few vulnerabilities (the hassle of returning products) while increasing foot traffic for Kohl’s stores. Kohl’s is making a number of other investments to make shopping in its stores more attractive, such as a mobile wallet that includes personalized, in-store promotions based on a customer’s shopping history. The company’s latest financial returns demonstrate that its commitment is paying off.
  • Target, which is also beating analysts’ expectations, is trying new shopping formats such as smaller stores in cities and is new services such as same-day delivery. As Target operationalizes his recent acquisition of Shipt, expect the company to make its brick-and-mortar locations more dynamic centers for delivery and curbside pick-up.
  • Meanwhile, Walmart is combining a number of approaches – including mobile shopping, grocery delivery, online/offline commerce, and development of private labels – to increase revenues. But analysts expect even more out of Walmart, which is a back-handed compliment to its power. Despite reporting growth in its most recent earnings announcement, the company saw its stock price drop because some of its key performance indicators did not do as well as analysts expected.

The results from these big retailers show that brick-and-mortar businesses have plenty of reason to smile even in the era of Amazon. But succeeding means:

  • Conceiving of new ways to manage locations with new services, a better shopping experience supported by mobile, and even opening up locations to other businesses.
  • Constantly adapting the business model – being open to new services such as curbside pick-up and delivery.
  • Making sure your customers are aware of the services you offer. For example, Kohl’s raises awareness for its Amazon Returns at Kohl’s counters through a combination of offline promotion (including prominent signage at his locations), location marketing on its store websites, and location marketing on Amazon (where the counters are referred to as Amazon pop-up stores).

To manage your locations like assets supported by strong location marketing, contact us. We’re here to help.

Adam Dorfman

Author Adam Dorfman

Adam Dorfman is an interactive marketing professional with over 15 years experience in all facets of online marketing including local & organic search, pay per click, paid inclusion, email, RSS/XML driven advertising, ad networks, social networking, blogging, website analytics, usability and offline integration as well as web development, hosting, networking and project management. Read more.

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