"We've made lots and lots of changes at 'The Market @ Macy's' based on customer feedback," Marc Mastronardi, executive vice president of new business development at Macy's, said about what's happened since the retailer rolled out the marketplaces earlier this year. "We're bringing the brands to life."
One change is making the marketplaces larger. The newer locations in Atlanta and Los Angeles will be nearly double the size of the earlier "The Market @ Macy's" locations, according to Mastronardi. And the existing shops could grow over time, he said.
The pop-up marketplaces in Macy's stores are, also importantly, one way for the company to use its excess real estate as it tries to cut back on its inventory and stock fewer items at any given time as more retail sales move online. According to Coresight Research, online retail sales are expected to grow nearly 16 percent this holiday season from a year ago, capturing roughly 16 percent of total retail sales. This would be up from a share of 14 percent in the fourth quarter of 2017.
Many of the brands coming into "The Market @ Macy's" have never had a store before, Michelle Klein, director of Facebook's North America marketing division, told CNBC. Some names among the list of 150 include Love Your Melon, a hat and apparel company that donates 50 percent of its profits to benefit children with pediatric cancer, and Two Blind Brothers, a clothing company that donates its profits to research to cure blindness. The products will be sold in Macy's stores in early November and stay there through the new year.
This holiday season, shoppers should expect to see more retailers bringing experiences into stores, as so-called Instagram-worthy museums, where customers can pay money to take photos in glowing ball pits or rooms full of ice cream, are blanketing major metro areas. That's just one thing retailers have to compete with to win shoppers' dollars.
Companies — especially department stores like Nordstrom and J.C. Penney — are meanwhile looking for ways to stand out and compete with the ease of online shopping. Walmart is holding toy events in some of its stores this holiday season, for example, to try to give shoppers something they can't find on the internet.