The news: Macy’s raised its full-year guidance after better-than-expected Q3 results, driven by strong sales for its premium Bloomingdale’s and Bluemercury nameplates. But Kohl’s withdrew its guidance for the year and declined to provide Q4 estimates as it continues to struggle to find its niche.
Why Macy’s is bullish: Macy’s relatively strong performance owed to its wide variety of goods across multiple price points—in essence, becoming a one-stop shop for shoppers of all incomes. That breadth helped the retailer capitalize on continued demand for luxury goods without sacrificing its appeal to cash-strapped shoppers.
Why Kohl’s is in trouble: While Kohl’s has successfully fended off several threats this year, including from activist investors pushing the retailer to sell itself, its place in the retail landscape is becoming increasingly tenuous. Neither luxe enough to attract big spenders nor discounted enough to bring in bargain hunters, Kohl’s is increasingly out of step with the majority of shoppers.
A tale of two department stores: Macy’s steady performance in a period when many retailers have struggled is a testament to its strategy of having something for everyone, regardless of how much—or how little—they’re willing to spend. That will give the retailer a boost this holiday season as more shoppers look for ways to indulge without breaking the bank.
Kohl’s, on the other hand, is a perfect example of the importance of branding. Even in times of difficulty, shoppers gravitate toward their favorite retailers, making Kohl’s lack of distinct identity a major stumbling block as it tries to revitalize growth.
Go further: Check out our Holiday Shopping Report for more on what to expect this season.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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