Macy's: A new strategy for retailers, target fallen rivals
Macy's (M) has come up with a new way to get customers. It is going to go after people who used to shop at retailers that have gone out of business.
According to The Wall Street Journal, "Deutsche Bank estimates $21.4 billion in U.S. retail sales from defunct apparel, electronics and home furnishings stores are 'up for grabs' this year."
Healthy competitors could use the same tactic against Macy's, which closed 11 stores at the beginning of the year. These store closings cut its presence in markets including Indianapolis, Palm Beach, and Nashville. Other large retailers like Nordstrom (JWN) and Neiman Marcus would certainly like to pick up Macy's customers in those cities.
Trying to get shoppers from retail outlets that have closed may be a zero sum game. Store traffic in general has been hurt by the recession. Macy's may pick up customers from rivals in one city and lose them in places it has shut down in others.
Douglas A. McIntyre is an editor at 24/7 Wall St.