1

Macy's is one of the oldest department stores in the United States and an iconic retailing

brand. It operates 810 stores nationwide and offers a huge array of top brands in all

retailing categories. Events like the Macy's

Thanksgiving Day parade, 4th of July

Fireworks, holiday traditions, and celebrity

appearances all contribute to the nationwide

recognition of the Macy's name.

About Macys

Number of Stores: 851

Store Gross Sq. Ft.: 154,400,000

Total States: 45 (plus District of Columbia, Guan, and Puerto Rico)

Total Number of Employees: 166,000

{Information as of April, 2011, except for number of employees, which is as of January

29, 2011.}

Macy's and Bloomingdale's (a more upscale department store) sell men's, women's and

children's apparel and accessories, cosmetics and home furnishings. Aside from its brick-

and-mortar stores, Macy's also operates macys.com, bloomingdales.com and

Bloomingdale's by Mail in addition to an online bridal registry. Macy's portfolio of 15

private labels include: Alfani (offers modern separates with a clean, feminine sensibility

2

and a refined fit), American Rag Cie

(young, fashion-forward line of denim and

separates), bar III (the newest major

addition to the private brand portfolio),

Charter Club (classic, all-American style in women’s ready-to-wear and home

collections), Club Room (features classic American menswear for weekend or business

casual occasions and tailored suit separates for the career-oriented professional), Epic

Threads (designed for teens who want cool, original clothing that expresses their

personality), First Impressions (classic clothing for newborns and infants is defined by

fine fabrics and time-honored details), Giani Bernini (attracts a traditional customer who

recognizes quality), INC International Concepts (trend-right sportswear designed to

add freshness and fun to the fashionable woman’s wardrobe), Jenni by Jennifer Moore

(stand out as the choice for the young, fashionable customer, featuring a bright and

cheerful selection of pajamas, loungewear and lingerie), JM Collection (designed for the

woman who wants versatile, work-to-weekend clothes at an affordable price), Style&Co.

(designed for the busy woman with an easy, modern sense of style, this brand offers a

versatile collection of fashionable sportswear and stylish accessories that transition from

home to work to weekend.), Tasso Elba (elegant and refined, this brand of European-

inspired classic menswear, designed for the more traditional customer, who expects the

best in investment dressing), Hotel Collection (offers high thread-count sheets and

luxurious fabrics for the customer who appreciates quality and modern design), and

Tools of the Trade (with more than 20 years of success, is designed to provide high

performance at a reasonable price). These brands are only available at Macy's.

3

About Private Label Brands

Private label brands are clothing lines whose design, production and distribution are

controlled by the retailer itself. They are especially popular in department stores such as

Macy's, JCPenney, and Saks. Private brands are an attractive choice for the retailer

because they can produce exactly the pieces they want instead of looking for them among

their suppliers. In addition, they have control over the quality and fabrication of garments

under those lines so they are more able to control the costs of the goods. In addition,

since they are produced and sold directly to the consumer, private brands are usually less

expensive than brands from third-party companies. The lower price point makes private

brands more attractive to low-income consumers as well as those hoping to curb their

spending due to poor economic conditions. According to The Nielsen Co., private label

sales have been increasing since the recession began and captured a high share of many

departments of retail stores studied.

Private brands have been receiving increased attention from retailers due to the increased

control they have over the production and distribution of their own line. Also, they tend

to have a higher profit margin than third-party goods. This has impacted Macy's product

mix as retailers move towards increasing private brand offerings.

Macy’s Competitors

Macy’s faces strong competition in the retail industry from other retailers in their

geographic areas, including other traditional, moderate or luxury department stores,

specialty stores, general merchandise stores, off-price and discount stores and other forms

of shopping including the internet, mail order catalogs and television. Retailers

competing with Macy’s include:

4

• Other traditional department stores such as: Bon-Ton Stores, Belk, Dillard's, and

Sak’s Department Store Group

• Moderately priced department stores that have lower gross margins than

traditional stores like Macy’s. These include: J.C. Penney, Kohl's, and Sears

Holdings

• Luxury department stores such as: Neiman Marcus, Nordstrom and Saks

• Discount stores such as: Target and Wal-Mart Stores.

• Warehouse stores such as: BJ's Wholesale Club Costco Wholesale and Wal-

Mart's Sam's Club.

• Off-Price stores such as: Ross Stores and TJX Companies

In terms of price point, Macy's faces stiffest

competition from JCPenney and Sears Holdings.

Luxury department stores such as Saks operate at a

higher price point, attracting a clientele with more

disposable income. Discount stores operate at a much

lower price point, attracting less affluent consumers.

Macy's is distinct from warehouse stores in that it does

not sell goods in bulk and operates at a higher price

point.

Thesis

5

To continue to build company value by offering a new private label, the GOOD

NEIGHBOR® collection, a green retail strategy that will benefit vendors that comply

with a sustainable production sourcing code of conduct.

Branding and Positioning

GOOD NEIGHBOR® is part of Macy’s private label. As the name says,

the GOOD NEIGHBOR® logo means being a Samaritan, a do-gooder, a

helping hand, or a humanitarian. The typeface used was Courier New,

and the hue palette chosen is Pantone Solid #105. The GOOD NEIGHBOR® collection

will feature organic t-shirts made of 100% organic cotton. Macy’s views the green private

label as a way to show its appreciation for

the communities where Macy’s does

business.

The merchandise will be purchased from

Anvil Knitwear®, a 130-year-old

sportswear apparel brand, which will help to present a distinctive assortment line of

unique merchandise.

“Anvil's commitment to sustainability is comprised of three pillars: environmental, social

and product. In recent years, the company has rolled out 17 industry-leading, affordable

6

eco styles, made from a variety of fibers including certified organic cotton, transitional

cotton, recycled cotton and recycled PET bottles in addition to its more than 100

traditional styles that are all manufactured using responsible practices. Anvil's organic

products are part of its larger commitment to growing the acreage of U.S. organic

cotton; the company is currently the largest buyer of U.S. — grown organic cotton

according to Organic Exchange.”

Due to the fact that Macy’s is a top retailer in the US, Macy’s understands that

sustainability is more than a matter of customer satisfaction. Macy’s believes this is the

right thing to do.

"Corporate engagement is essential to the international community's efforts to alleviate

poverty, ensure clean water, and help underserved populations realize healthy living,"

said Amir Dossal, Executive Director of UNOP. "We want to recognize the creativity,

technology and resources that Anvil and the other honorees bring to our collective efforts

in solving social problems."

Like Macy’s, Disney Stores LLC has also participated in the sustainable movement and

formed a partnership with Anvil Knitwear to make all of its graphic T-shirts with 100

percent certified organic cotton. For a retailer like Macy’s, this partnership/initiative

would be groundbreaking in introducing a sustainable product to the mass market. Like

Wallmart, Macy’s dominates the US market with the amount of stores locations. It will

be a great strategy to help local farmers, educate the consumers, and bring value to the

company. Macy’s wants to be the pioneer and wants to start ‘pushing’ the retail industry

to be more sustainable.

7

About Anvil Knitwear

“Anvil Holdings Inc., which operates primarily

through its Anvil Knitwear unit, makes active wear for

men, women, and children that the company sells to

screen printers, private-label brand owners, and distributors in the US. It's also a leader

in eco-friendly, sustainable apparel, primarily consisting of short- and long-sleeve T-

shirts. Anvil also makes bags, caps, robes, and towels. Before they're purchased,

oftentimes its products are embellished with characters, designs, or logos. Brands

include Anvil Logo, AnvilOrganic, chromaZONE by Anvil, and Cotton Deluxe Towels

Plus by Anvil, as well as private labels for other companies.”

8

Functional: It brings a contemporary and stylish look for the eco-conscious customers

and it’s also 100% free of chemicals and pesticides.

Innovative: Smart design, eco-friendly materials and simple care, styles to wear for more

than one season

Sustainable: Made of 100% organic cotton

Personality: Contemporary, cool, minimalist, modern, and timeless.

9

Customer Analysis

The younger generation is equal parts expression, consumer, and world changer.

Because Macy’s is located in the most diverse markets in the nation, the target market

varies. This generation, also known as Generation Y and Echo Boomers, is consisted of

young men and woman, youngsters who like to shop, socialize, and save the world all at

the same time. These individuals are creative trendsetters that are socially aware or are

becoming more socially active. They are also technologically savvy and are up to date

with online and other electronic trends. They live an artistic lifestyle full of self-

expression. They are not afraid of expressing their individuality through their own unique

10

outlets like: sports, drawing, music, dance, or charity work. They are civic-minded and

socially conscious individuals, who place a high value on inner and outer appearance and

want to be stylish, original, eco-chic, mainstream, and to look, feel and be at their best.

They are in their mid-20s and younger; with a median income of $70,000.

“By merchandising and marketing to the college crowd, retailers are hoping to not only

boost this year’s sales but also to gain customers for life.”

11

Action Point #1

The goal of this strategy is to differentiate GOOD NEIGHBOR® in the mind of our

target market by promoting the story that comes along with a stylish t-shirts. The target

market is 10 – mid 20’s students and professionals, who are concerned with style and

social justice. The focus will be on promoting the

fact that GOOD NEIGHBOR®’s t-shirts can be

trackable. The graphic T-shirts will show complete

traceability from farm to retailer through

trackmytee.com. The shirt tags will have the web

address and the code number needed for the website.

Macy’s main goal is to educate the consumers, what

they can do to help, and engage with the brand.

Merchandise Assortment

Macy’s plans to ‘roll-out’ this concept throughout the country, but to focus on a limited

assortment of merchandise – focusing exclusively on graphic tees. The assortment will

be organized by colors and sub-divided by sizes in each category: women, men, and kids.

To drive initial demand and interest in the new concept, Macy’s will partner with well-

known musicians, actors, and artists that are active in the green movement. The t-shirts

will feature graphics and artistic illustrations by these contributors, and be produced in

limited runs of 10 k units for each design and sold for a limited amount of time. Macy’s

will charge a slight premium for the limited edition tees produced by the celebrity

partners. In addition, Macy’s in-house team of graphic designers will produce a line of

fashion styles that will have larger production runs, but get refreshed each season.

12

The section where GOOD NEIGHBOR® will be allocated within Macy’s has to reflect

GOOD NEIGHBOR®’s values and the environmental commitment to the brand. All

furniture must be made with high quality and durable materials, using reclaimed wood or

from certified harvested wood. This section within Macy’s has to be different from the

others; it must reflect a rustic appearance befitting the brand’s earthy origins. Since all

stages are designed to accommodate the space in which they are located, t-shirts must be

displayed and organized in mannequins, impact tables, and in display fixtures.

Action Point #2

In-store communication:

Furniture: seats: without hanging part “poufs”;

13

Tables: Square and rectangular (different heights can slide into each other)

Small rectangular tables;

Materials:

Wood: table, hangers;

Suede: poufs and carpet;

Visual Merchandizing:

Amount of garments: 3 – 4

of each (XS, small, Medium,

Large, XL);

Folding: All t-shirts are

folded in three parts;

Table Display: used for the

limited edition t-shirts to be displayed;

Display: mannequins, impact tables, and displays;

Interior Design:

Lighting: standing mirror on each side of the main table;

On the table there will be lights with fabric around them, which are soft;

Ceiling: sets of small and large lights all over the ceiling to create an atmosphere, and

lighting on the mannequins and t-shirts;

Use of white space: GOOD NEIGHBOR®‘s bright t-shirts will play in a simplified

white background. This sophisticated combination is appropriate for the brand’s

environmental message of simplicity and emphasizes the clothing itself.

14

Colors:

Because our target market is young, most of the brand messaging primary colors of t-

shirts are bright colors as well as natural, or earth tone hues.

Imagery:

Kids

15

Imagery:

Adults

16

Merchandise Promotion

In order to stay ahead of the competitors and to gain loyalty with its consumers, Macy’s

will create a portfolio of decorated t-shirts and products in partnership with various

leading non-profit organizations, musicians, and artists. These organizations and

individuals will then use our products as fundraisers, in some cases selling them at retail

with a portion of the profit going to the cause.

Action Point #3

Each season, Macy’s will offer a new and updated line of both fashion and limited edition

tees. The limited edition series will crate a ‘Halo Effect' for the fashion line produced by

Macy's in-house graphic designers. Macy’s will attempt to reinforce its Customer

Relationship Management (CRM) program by notifying its Macy’s card-holders that a

new edition of limited GOOD NEIGHBOR® tees is being released and also by allowing

them to pre-purchase them at a slight discount before they are available to the general

public. This program will help build loyalty to the collection and help promote online

sharing via blogs, customer feedback postings, or tweets. The most loyal GOOD

17

NEIGHBOR® customers will also be eligible for other special discounts and be invited

to select in-store events such as fashion shows, or celebrity appearances.

S/S 12 Mood Board:

Directional trends for spring and summer 2012.

18

Thank You

###

19

Citation

Page: 5

www.macys.com

Page: 7

http://www.fibre2fashion.com/news/garment-company-

news/newsdetails.aspx?news_id=92211

Page: 8

www.anvilknitwear.com (image)

www.hoovers.com

Page: 11

http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=165

Page: 6, 12, 13, 14, 14, and 16 (images)

http://www.anvilmarketingtools.com

Page: 18 and 19 (images)

http://www.stylesight.com