Retailers like Nordstrom, Macy's, Kohl's, and J. Crew are opening lower-priced outlets to drive sales. As consumers spend less on apparel and more on technology, healthcare, and travel, discounts are necessary to draw in new customers.
Watch out, Macy's. Nordstrom is expanding its off-price chain, Nordstrom Rack, like crazy. The brand plans to bump its current 180 stores up to 300 by 2020, Women's Wear Daily reports. While the outlet model may devalue other retailers, Nordstrom has seen a huge cash influx with its Rack expansion by catering to a different demographic.
This earnings season has been tough for retailers, and for more than one reason. But it has become clear that an industry-wide shift toward e-commerce is still evolving, with some faring well but most facing problems in setting up a smooth and streamlined “omnichannel.” Be it Walmart, JC Penney, Macy’s, or Dillard’s- an overall weak retail environment coupled with a shift toward online sales has impacted quarterly performances for physical retailers.