Macy's may need to cut jobs if this foot traffic trend holds up
Macy's ($NYSE:M) is expected to announce earnings of $0.33 per share when it reports earnings May 15, according to Zacks Investment Research, which tracks analyst ratings. Foot traffic and retail footprint data indicate there are silver linings for the retailer — although it appears to not have made staff cuts similar to so many other retailers that have faced declining revenue and long-term prospects as more shoppers turn to apps.
Many retailers are challenged by declining foot traffic. However, Macy's may have an advantage over competitors with its 2015 deal to acquire Bluemercury which it has expanded in subsequent years.
Foot Traffic May be Leveling Off
Were Here Count tracks how many check-ins, mobile device shares, and photo-location tags are made in a place related to a business with a Facebook ($NASDAQ:FB) account - it acts as a gauge of foot traffic. According to our Were Here Count, Macy's saw foot traffic increase about 14% across 2017. The following year, it was up just 7% - and so far this year, it's up about 1%. Is it a sign Macy's brands are losing traction as malls slip further out of cultural relevance in the US - or, is it a sign that consumers are turning their backs on the social network and deleting the app? Likely both, both this is a plateau that can't be good for retail sales down the road.
Boosting Bluemercury - Cutting Back on Macy's Brand
Macy's snapped up Bluemercury.com in a 2015 deal valued at more than $200 million. It has expanded the online retailer's physical footprint in the time since. At the same time, Macy's has shuttered underperforming legacy sites.
Macy's shares are down to begin the year and have fallen about 35% over the last six months. Which makes the next data point somewhat surprising...
Macy's Headcount isn't Shrinking - Even if its Real Estate Footprint Is
Macy's earnings reports for 2019 and 2018 state headcount has held steady - so perhaps the slight increase our data reflects is attributable more to seasonal staff updating their LinkedIn profiles at the holidays for LinkedIn ($NYSE:LNKD), which is excluded from their reporting. Our data shows a steady It remains to be seen how much longer this last trend will hold - the retailer hasn't been generating much more attention for itself online, but then again, it has been reducing its real estate footprint. Any further cutbacks in store counts, could be matched with a reduction in headcount. But a reduction in share value might guarantee the exact same thing.