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Macy’s, the American titan of retail.

The Retail Giant in Retreat

In 2024, Macy’s announced it would close 150 under performing stores and focus on expanding its higher-performing locations like Bloomingdale’s and Bluemercury. It was a bold move, but not an unfamiliar one. Macy’s, a department store titan with over 160 years of history, has reinvented itself many times before. What makes this moment different is how it reflects a deeper business truth: not all growth is good growth. As consumer behavior shifts and e-commerce dominates, Macy’s is proving that legacy companies don’t have to die, they just have to adapt. The company’s decision to prune back in order to grow stronger offers a valuable lesson for businesses of any size. This isn’t just a story about retail; it’s about focus, discipline, and letting go of what no longer serves you. And as we’ll see, that mindset has been part of Macy’s DNA from the very beginning.

A Dry Goods Shop With Big Ambitions

Macy’s was founded in 1858 by Rowland Hussey Macy, a former whaler who opened his first dry goods store in New York City after several failed business attempts elsewhere. He believed in starting small and adapting fast. His first NYC store made just $11.08 on its opening day, but Macy reinvested every dollar with discipline. He was also an early innovator in marketing, using in-store Santa Clauses and illuminated window displays to draw crowds during the holidays. These clever touches transformed Macy’s into more than just a place to shop. It became an experience. That approach helped distinguish the brand from competitors at a time when department stores were just beginning to emerge. Macy’s was among the first retailers to move uptown with the city’s growth, showing a talent for anticipating trends. By the early 1900s, it had become the largest store in the world, anchored by its iconic Herald Square flagship.

A Business Built to Scale (and Shrink Smartly)

Through the 20th century, Macy’s weathered wars, recessions, and fashion revolutions by staying remarkably adaptive. The company grew through a combination of innovation and acquisition, expanding nationally by buying up regional department stores and rebranding them under the Macy’s banner. By the 2000s, it operated hundreds of stores and became synonymous with American retail, thanks in part to its Thanksgiving Day Parade and pop-culture presence. But scale brought challenges. The rise of e-commerce, changing demographics, and bloated store footprints began to chip away at profitability. Macy’s leadership understood that nostalgia couldn’t keep the brand alive, it had to keep evolving. In the past decade, they’ve leaned into data-driven store optimization and refreshed their private label offerings. Still, it wasn’t until the 2024 store closures that Macy’s fully embraced strategic pruning as a growth strategy.

Pruning to Grow Stronger

In February 2024, Macy’s announced a sweeping decision: 150 underperforming stores would close as part of a bold realignment strategy. The focus moving forward? Doubling down on the most profitable locations—particularly Bloomingdale’s and Bluemercury, two of Macy’s higher-end subsidiaries. CEO Tony Spring emphasized that the closures would allow Macy’s to "invest more meaningfully in our strongest stores and digital business" instead of propping up underperforming ones . The decision shocked some investors, but it reflected a growing realization across legacy retail: survival depends on focus. Alongside the closures, Macy’s revealed plans to open 30 new Bloomingdale’s and Bluemercury locations by 2026, a clear pivot toward more premium, experience-driven shopping. This wasn’t about contraction, it was about recalibration. Macy’s understood that the path to relevance isn’t always forward; sometimes, it means stepping back to see what’s actually working.

The shift is rooted in data. Macy’s analyzed performance across its retail footprint and saw a massive gap between high and low-performing stores. Rather than spreading resources thinly across 500+ stores, the company is now reallocating capital into stores and channels that convert customers most effectively. These include smaller-format stores in wealthy suburbs, locations with strong omnichannel integration, and brands that resonate with younger demographics. It’s a tactical response to changing consumer habits, especially the migration toward digital-first retail and curated in-store experiences. According to Macy’s leadership, these investments will boost profitability and allow the company to compete not on size, but on precision. The company is also exploring new AI-driven personalization tools and upgraded loyalty programs. Together, these moves show that Macy’s isn’t clinging to the past, it’s designing a more efficient future.

What makes this particularly compelling is the clarity of purpose behind the strategy. Macy’s is not just reacting to e-commerce pressures, it’s strategically redefining what a modern department store looks like. In contrast to rivals that have chosen to rapidly scale or chase flash-in-the-pan trends, Macy’s is intentionally slimming down to build up. That message resonated with Wall Street, as the company’s stock saw a bump following the announcement . It also sent a clear signal to customers: Macy’s is getting smarter, not smaller. The changes reflect a broader shift in retail thinking, from quantity to quality, and from legacy size to targeted strength. For a brand that once built its empire on being the biggest, this pivot proves it’s just as willing to win by being the sharpest.

Strategic Pruning Beats Blind Growth

At its core, Macy’s 2024 strategy is a masterclass in disciplined decision-making. Too often, businesses chase growth for growth’s sake, expanding product lines, locations, or services without evaluating whether they actually add value. Macy’s is showing that there’s power in restraint. Rather than frantically scaling or burning capital, they’re looking at their business with clear eyes and cutting what doesn’t work. That takes courage, especially when your brand has long been defined by size. But in the modern economy, efficiency, not footprint, wins. By focusing on their most successful stores and high-conversion digital channels, Macy’s is concentrating energy where it matters most. It’s the retail version of the 80/20 rule, putting your best resources behind your best-performing assets.

The lesson is universal: if you want to grow, start by trimming the fat. Whether you're running a retail chain, a startup, or a solo consultancy, there’s likely a part of your business that’s under-performing and dragging everything else down with it. Macy’s teaches us to stop being sentimental about what once worked. Just because a store was profitable in 2005 doesn’t mean it deserves investment in 2025. Their example reinforces the value of regular business audits, hard choices, and the discipline to walk away from anything that no longer aligns with your goals. This is the kind of thinking that future-proofs a business. Growth becomes sustainable only when you’re willing to let go of the unnecessary. And in Macy’s case, that shift may end up saving one of the most iconic names in American retail.

The pruning strategy also suggests that businesses must reallocate, not just reduce. It’s not about doing less; it’s about doing the right things better. Macy’s is investing those saved resources into high-margin locations, improved tech infrastructure, and targeted marketing. In other words, they’re not cutting to survive—they’re cutting to evolve. And this is a reminder that focus doesn’t have to mean playing small. It can be a signal of maturity, a sign that a business is ready to compete with intention rather than inertia. The takeaway is clear: discipline is what separates companies that endure from those that just hang on. Macy’s may be scaling down, but it's aiming higher than ever.

Legacy + Takeaway: Why Bigger Isn’t Always Better

Macy’s has long been a symbol of American consumerism, known for grandeur, abundance, and the Thanksgiving Day Parade. But its true legacy may come not from how big it got, but from how wisely it chose to get smaller. After nearly 170 years in business, Macy’s is learning that longevity requires evolution, not just expansion. The company’s recent willingness to let go of legacy stores and reinvest in areas with proven potential is a lesson in strategic maturity. Instead of dying a slow death trying to sustain outdated models, Macy’s is reshaping itself for a new kind of retail economy. This adaptability is a major reason why it remains relevant while so many peers have folded. By focusing on profitability over footprint, Macy’s is reestablishing itself not as a giant, but as a sharp, targeted competitor. That repositioning, intentional and data-driven—may become its most powerful legacy yet.

For entrepreneurs and business operators, Macy’s story is a call to pause and reassess. What products, services, or clients are draining your time with little return? What parts of your business no longer reflect who you are or where the market is headed? Strategic pruning isn't about shrinking, it’s about creating space for your best work to thrive. Use performance data to guide decisions, even when those decisions are emotionally tough. Think of your resources like sunlight: the more you spread it across weak branches, the less energy your best ones get. Macy’s didn’t pivot because it failed, it pivoted because it paid attention. The real win comes not from doing more, but from doing better. In your own business, that mindset shift can turn slow growth into smart momentum.

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