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“TV is one of our largest media expenditures,” Lennox said. “We know that TV remains the best vehicle to reach a broad target audience at a low CPM, so highly efficiently. We also know that our 15-second spots are 86 percent as efficient as our 30-second spots, but I can buy a 15-second spot for half the price of a 30-second spot. So by altering the ratios between 15s and 30s in my media mix, I can get a higher return on investment for a lower marketing spend.” Those seemingly ever-present Super Saturday promos and other frequent ads the have become increasingly synonymous with Macy’s will also get scaled down. Lennox said Macy’s will create a “new species of marketing event” called “standalone tentpole events.” “Four times a year [we will] step into the marketplace and create a point of noise and excitement around the Macy’s brand,” Lennox said. “Those tentpoles will be centered around spring fashion, summer, fall fashion and the holiday season.” Macy’s will amplify its efforts to cast itself as a fashion authority by introducing “The Edit,” which will highlight newness, exclusivity and hot “it” items. But, even with a renewed focus on exclusive and elevated product, Gennette noted that customers can continue to expect lots of sales. “We are going to remain a promotional department store, but we want those values to be much clearer to the customer,” the CEO said. As far as pricing goes, Gennette noted that the firm will move toward a more simplified pricing model that would communicate value primarily and include “faster and deeper permanent markdowns.” The department will also seek to reward its most valuable customers in a stronger way with the roll out of a new loyalty program in the fourth quarter. Macy’s is on a mission to grow its digital business.
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