Macy’s is betting that the booming beauty industry will return to growth.
The company may be scaling back its namesake store footprint across the U.S., but it’s also doubling down on its commitment to Bluemercury, the luxury beauty retailer it has owned since 2015.
On Deck: In addition to a significant number of store openings and existing door upgrades, we have re-emphasized the differentiated brand, premium locations and service elements that have distinguished Bluemercury since its inception. The goal: Make Bluemercury a strong competitor in the North American specialty channel space currently dominated by Sephora and Ulta Beauty.
“Over the next three years, at least 30 new stores and 30 new We’re going to renovate it,” he said. “We create self-care escapes in the most sought-after neighborhoods, carefully curating beauty products rooted in efficacy, craftsmanship, service and education. Our strategy allows us to create top-notch luxury beauty… We are planning to become a product retailer.”
The company currently operates 159 free-standing stores and 19 within Macy’s department stores. This is nearly triple the number of stores it had when it was acquired by Macy’s for $210 million in cash from founders Mahla Beck and Barry Beck. By comparison, Sephora has 565 freestanding doors in the United States, while Ulta operates 1,374 freestanding doors. place.
The Bronxville store is one of two recently opened prototypes that give a preview of what the new, renovated store will look like. The other, in New Kernan, Conn., will reopen in October 2023 with positive early results.
Inside Bluemercury’s redesigned New Canaan store.
courtesy
Tony Spring, who took over as CEO of Macy’s in February, said, “Our latest model change has been well received and will serve as a foundation for that.” His comments came during a conference call with analysts to discuss fourth-quarter 2023 earnings and announce a new strategy called a “bold new chapter.”
The plan includes accelerating growth in luxury goods through Bloomingdale’s and Bluemercury, as well as closing about 150 unproductive stores by 2026, possibly including a flagship store in San Francisco. The plan was largely praised by investors. “We think aesthetics will be the easiest part of this,” said Neil Saunders, managing director at GlobalData, “primarily in high-growth markets where Blue Mercury has historically underperformed.” “It’s because of that.”
Spring has high hopes that Macy’s investments will further fuel Bluemercury’s sales growth after the beauty retailer posted 12 consecutive quarters of similar sales growth. ing. Net sales increased by 7.8%, comparative sales increased by 2.3%, and the loyalty program Blue Rewards increased by 19%. In comparison, Macy’s net sales decreased by 1.7% and comparable sales decreased by 5.4%.
The Bronxville and New Canaan stores embody Bluemercury’s strategy, which executives have dubbed the “New Blue.” First, the fact that both are located in leafy, affluent suburbs suggests the future of Bluemercury’s location plans. “What works best for us is when we’re in the suburbs,” said Bernstein, the first outside CEO to take the reins of the store. He added that Sonoma County has been earmarked as a potential location for a new store, but did not disclose other potential locations.
This suburban approach is where many brands prefer Bluemercury. Elana Dorrell Cypher, CEO of Revive Skincare, who has been with Bluemercury since its inception, said: Located in key upscale environments and neighborhoods, we focus on customizing the shopping experience to what our customers are looking for, offering the more personalized feel of a local neighborhood store. ”
Bernstein also supports independent stores. So while Sephora and Ulta are fast-tracking partnerships with Kohl’s and Target Co., respectively, don’t expect Macy’s push to add more Blue Mercury stores inside department stores anytime soon. “The focus is on the core,” Bernstein said. “As a result, we will be building independent stores.”
The new format is designed to emphasize high-touch service elements in terms of look and feel.
A central bar, designed by Bernstein to mimic a chef’s table, will provide customers with opportunities for consultation, tutorials, new product offerings and brand discovery with Bluemercury’s in-store beauty experts.
The discovery area in the central bar is called ‘The Cache’ and is Bluemercury’s initiative launched in October 2022 to attract up-and-coming brands at the cutting edge of innovation.that Updated every four months, February includes wellness supplements from skincare brands Clark’s Botanicals and Viktor Michael, as well as Biocol Lab.
Founder and CEO of Clark’s Botanicals, a longtime Bronxville resident whose best-selling products at Blue Mercury are Retinol Rescue Overnight Cream, $150.
“My favorite thing about working with Bluemercury is that they welcome the fact that I go into the store every day,” he continued. “Because it helps you train your staff, establish an emotional connection with the people working in the store, and quickly establish a customer base.”
In addition to The Cache, Bluemercury changed its merchandising matrix. This includes an increased focus on fragrances from brands such as DS & Durga, Baobob, Trudon, Creed and Maison Francis Kurkdjian.
“Fragrance is a big deal for us, because this wasn’t just an expansion, it was a really personal entry into fragrance and into a more luxurious home,” Bernstein said. “We’ve also seen a lot of excitement about professional skin care.”
In fact, Bluemercury has strengthened its range of dermatological skin care solutions from brands such as Skin Medica and Obagi to meet increasing consumer demand in this area. For body care, Aesop and Cerulean 6° have been added to the mix. In color cosmetics, retailers include Tom Ford, Aussie, Pat McGrath Labs and Sisley.
Regarding pricing strategy, Bernstein said, “As we expand into the professional skin care and luxury fragrance categories, our average retail unit price has naturally increased.” “We find that our clients prioritize effective products and sophisticated packaging, along with our personalized approach to service.”
Her personal favorites include Vintner’s Daughter Botanical Serum, $195. M61 Power Glow Peel Extra Strength 20%, $38-$72; U Beauty Plasma Lip Compound, $68. Sisley Paris Le Fite Rouge Shade in Shine Rouge Hollywood, $70. Gian Marini Transformation Face Cream, $125, Gian Marini C-ESTA Face Serum, $129.
In addition to offering more products, retailers are using technology to appeal to customers. For example, Magic Touch allows customers to hold their phone over a blue sticker on an item in the store. Similar to a QR code, it triggers a pop-up where customers can get detailed information about the product and decide whether to pick it up in-store or have it delivered to their home. (This is especially useful when purchasing oversized turdon or baobab candles, which can cost upwards of $650 and weigh a whopping 23 pounds.)
“Our New Blue vision is all about evolving the omnichannel client experience for the modern luxury consumer,” said Bernstein. “We want our clients to feel free to experience our high-touch service and effectiveness IRL and URL curation. E-commerce allows you to customize samples or book spa services. and access more product education, all part of full immersion in our brand.”
Then there are the skin care services that Bluemercury has offered since its inception and will continue to offer. The redesigned spa features a HigherDose full-spectrum infrared sauna, and the menu offered in the treatment rooms includes Bluemercury’s in-house brand M-61 Skincare, as well as Obagi, Revive, SkinCeuticals; Includes a signature facial menu from partners such as Skin Medica.
“Our plan is to open one-room spas in most locations, while makeup services and beauty events, including on-floor facials, will be offered at all locations,” Bernstein said.
Although he declined to say what percentage of the customers he serves buy the product, he said those who engage with the service are Bluemercury’s most loyal customers.
Overall, this approach is designed to ensure that services are integrated into a complete brand immersive experience, starting with a consultation at the front of the store, with a makeover in the middle, and extending the experience with a spa trip at the back of the store. It also includes options to
“When I think about what Bluemercury has to offer, I’m reminded of the fact that we take beauty personally,” Bernstein said.