Macy’s, Nordstrom, Capri and Shopify Step Up at Goldman Conference
A gaggle of retail’s top leaders turned up Thursday at the second day of Goldman Sachs 29th annual Global Retailing Conference to defend their turf, point to opportunities and acknowledge — kind of — just how scary the consumer landscape is.
From a deep dive on e-commerce penetration from Shopify to a look at the promotional environment from Macy’s, the day’s sessions made clear that the industry feels well prepared, but that the changes will keep coming in the second half.
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Here, some key takeaways.
Shopify
When the pandemic hit, locked-down consumers logged on — spurring an e-commerce boost that appeared to fade as stores opened back up.
But Shopify president Harley Finkelstein said the digital dynamic has indeed changed.
“But if you just look at e-commerce growth by itself, we’re going to hit $7 trillion by 2025,” Finkelstein said. “The e-commerce growth curve is back to where it was in 2019 but on a much higher base. And I think that gets lost a little bit in some of the graphs and the noise.”
Macy’s Inc.
Macy’s Inc. chief financial officer Adrian Mitchell, giving a report card on the business, said, “Those occasion-based categories, the dressy categories, the shoes categories, the fragrances categories, those are really on fire. So there’s a composition element that we think is actually quite important right now. So we’ll continue to lean into freshness as we get into the back half of the year.”
Mitchell said promotions industrywide are going to be “intense” this fall, but added that Macy’s will enhance margins as best it can, and has some new tools involving a more scientific approach to pricing, including markdown optimization, by style, category, store and channel, as well as personalization.
Nordstrom Inc.
At Nordstrom Inc., performance by category and channel has been a mixed bag. “Our core categories, women’s apparel, men’s apparel, shoes, beauty, designer, all had double-digit increases in the Nordstrom banner,” said chief executive officer Erik Nordstrom. “We continue to see a lot of strength in the customer there.
However, Nordstrom’s private label business has been “a real soft spot for us and that’s on us.” But there’s been leadership changes in the private label operation, and “we do have less percentage of our inventory in our own product for the back half of the year than we’ve had in the first half of the year,” Nordstrom said.
Regarding inventory excess, which Nordstrom and most of the rest of the retail industry has been grappling with, CFO Anne Bramman, said, “It’s going to take a couple of quarters to get through it….We think the second half is going to be very promotional compared to 2019.”
Capri Holdings
John Idol, chairman and CEO of Capri Holdings, took to the stage at the conference to underscore his company’s higher-end positioning.
“Capri is now a luxury group,” Idol said. “We’re very proud of the acquisitions that we’ve made over the last few years with Versace and Jimmy Choo, and we’re also proud of what we’re doing with Michael Kors in terms of elevating the brand.”
The CEO said business was generally good, but he was also careful to acknowledge the economic realities of the moment.
“I don’t want anyone in this room to think that we’re looking through rose-colored glasses,” he said. “We know that there’s potentially things on the horizon that might be difficult.”
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