What: US department stores are increasingly leaving malls and opening smaller units in local communities.

Why it is important: This is a global trend with most of the largest players in the department store business making experiments on their own (Galeries Lafayette, Falabella and others).

Following Nordstrom and Bloomingdale’s examples of smaller stores with fewer products and more digital services to cater for local communities needs, Macy’s has opened five Market by Macy’s locations over the past 2 years in Texas. Those stores span over a total surface comprised between 2,200 sqm and 5,800 sqm, a fifth of the average Macy’s store surface.

During Q4 2021 sales in these units surpassed Macy’s expectations, and the group plans to open 10 off-mall locations this year, including some Market by Macy’s units, in addition to Macy’s Backstage (off-price), Bloomie’s and Bloomingdale’s outlets.

Macy’s is accelerating on the smaller store format