Macy’s Plans 60 New Bluemercury Stores in 2019

CINCINNATI, United States — Macy’s Inc., happy thus far with the efficiency of Bluemercury, is pushing for extra.

The cosmetics model, acquired by Macy’s for $210 million in 2015, will open about 60 new standalone shops via 2019 — sustaining the chain’s tempo of growth. Extra will open inside current Macy’s areas, underscoring how Bluemercury has turn into a key a part of the division retailer’s technique to defend its turf from on-line rivals and the rise of chains corresponding to Ulta Magnificence Inc. and Sephora.

The expansion will carry Bluemercury’s retailer depend to about 220. A lot of the areas will likely be in areas the place the model doesn’t have already got a presence, in keeping with co-founder Barry Beck. He highlighted smaller cities and city corresponding to Raleigh, North Carolina, Corona Del Mar, California, and Jupiter, Florida.

“We centered rather a lot on the coast and the large cities and so now we’re seeking to decide up a brand new buyer,” Beck stated. “There’s no purpose why a buyer from Little Rock has to journey all the best way to an enormous metropolis like New York, or Philadelphia or Miami to get these magnificence merchandise.”

Bluemercury has already opened about 100 new areas prior to now three years, almost tripling its fleet. Its flagship is a 2,700-square-foot retailer on the Hilton resort on Sixth Avenue in Manhattan the place it checks new merchandise. Inside, there’s a spa room and a man-made intelligence mirror that may scan and order objects for supply.

Tech-Assisted

Bluemercury’s comparable gross sales development is within the high-double digits, Beck stated, and the corporate desires to make use of know-how to take care of that tempo. It’s increasing a within-an-hour bicycle supply in New York to Los Angeles and is contemplating drone deliveries. It’s additionally creating phone-recognition software program to establish prospects as they enter a retailer after which sending them product strategies primarily based on current purchases.

Whereas department-store magnificence flooring as soon as dominated the market, with their battalions of fragrance spritzers attempting to lure customers into kiosks, specialists corresponding to Ulta and LVMH’s Sephora have quickly stolen market share, whereas startups give customers new choices, corresponding to subscription packing containers from Birchbox and Ipsy.

For Macy’s, Bluemercury affords a channel that may stand as much as these new incursions.

Rising Demand

It additionally helps that the general marketplace for premium magnificence is increasing: US gross sales of the merchandise, that are typically present in cosmetics retailers relatively than drug shops, rose 6 p.c to $17.7 billion in 2017, in keeping with knowledge from market analysis agency NPD Group. This was led by a resurgent skincare trade. Masks and different assorted face merchandise, corresponding to sprays and moisturisers, additionally carried out nicely final 12 months.

After Macy’s outgoing chief monetary officer Karen Hoguet stated earlier this 12 months that the sweetness division “was a enterprise that wanted to be rethought,” the corporate has made some progress. It stated cosmetics gross sales gained traction within the first quarter, serving to income beat estimates.

Macy’s inventory has risen by about 50 p.c this 12 months. Buyers seem optimistic the department-store chain can preserve its momentum regardless of the broader adversity confronted by the trade as firms transfer to shut shops and slash prices.

Beck sees Bluemercury enjoying an enormous position in serving to Macy’s navigate fast modifications within the cosmetics market.

“We actually turn into nearly a laboratory for them, the place they’ll take a look at and be taught after which take every part they’re studying from Bluemercury and simply overlay it throughout your complete Macy’s fleet,” he stated. “And I feel this can be a main alternative for them.”

By Hema Parmar and Kim Bhasin; editors: Anne Riley Moffat, Jonathan Roeder and Lisa Wolfson.

Associated Articles:

[ Macy’s Should Unleash Its Secret Weapon ]

[ Macy’s Posts First Sales Gain in Three Years ]