Macy's loses Facebook followers but holds foot traffic as it sets to release earnings
For better or worse, Macy's ($NYSE:M) is a creature of habit. After all, the department store has been selling everything from dry goods to smart watches since the 19th century. And, so far, it's worked out just fine.
But things are different these days. E-commerce has changed the way people shop, and Macy's can't rely on the foot traffic it once commanded.
So as the retail chain reports earnings, investors are understandably concerned with a 30% year-to-date drop in valuation, tariffs that are squeezing profits, and wage inflation that's making keeping stores open difficult. But all isn't doom and gloom for Macy's and its brands: it's hiring up for the holidays as usual and foot traffic trends are pointed in the right direction, e-commerce woes or not. Here's what we know.
Seasonal hiring on schedule
Macy's and holidays: name a more iconic combo. Like clockwork, the company goes on a hiring spree in the new year, and 2019 was no different. Hiring has held steady, too, in a sign that the company remains bullish on its retail locations and is weathering wage inflation.
Macy's foot traffic is healthy but plateauing
If the e-commerce boom has spelled trouble for brick-and-mortar retailers when it comes to foot traffic, Macy's appears to be bucking the trend, albeit with slowing results. That's because foot traffic for the retailer, as measured by "were here" count via Facebook geolocation data, has been on a steady path upwards since at least 2016. That said, the trend appears to be slowing to a potential plateau, which could suggest trouble down the line.
Macy's Facebook likes are down
For a while in 2018, Macy's boasted nearly 15-million Facebook followers. That means that any post the company sent from its Facebook account would go out to millions of potential shoppers. In late 2018 and into 2019, however, Facebook likes began a notable decline. They're still plentiful — 14.6 million — but the trend is pointed in the wrong direction. Whether this is simply due to users leaving Zuckerberg and Co has yet to be seen as the number of followers stabilizes or continues to fade.
Macy's "talking about" count is fading, too
If the number of people following Macy's on Facebook is declining, it stands to reason that the number of Facebook users mentioning the brand on the social network has declined as well. That's exactly the case when looking at Macy's "talking about" count over time, which measures the number of times per day that a particular Facebook account (in this case Macy's) is mentioned. As we reported in July, chatter from the company's July 4 celebration has failed to generate notable Facebook chatter at an increasing rate year over year.
Macy's retail footprint remains structured for success
When one thinks of Macy's retail locations, one no doubt imagines the chain's iconic 2,500,000 square-foot Herald Square flagship that has served as the backdrop of the Macy's Thanksgiving Day Parade since 1924. Outside of that store, Macy's still operates 641 locations, not counting its Bloomingdale's and Bluemercury stores. Compared to other retailers, Macy's has done little store closures. In 2016, it announced it would shutter 100 locations, and it recently announced the closure of just nine stores in early 2019.
What remains of Macy's, though, is structured for success. Locations tend to cluster around affluential population areas, and, according to 2017 census data, the average median income for all Macy's locations is a relatively spendy $64,100.
About the Data:
Thinknum tracks companies using information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.