Public Relations & Social Marketing Insight

When it comes to digital smarts, Nordstrom, Macy’s, Kohl’s and JC Penney rank at the Genius Level, according to the latest report from think tank L2. But while the industry as a whole is getting sharper, now spending 52% of digital ad budgets on mobile and maximizing customer engagement on Instagram, stores are still no match for the Amazon onslaught.

“Only five years ago, Macy’s apparel and accessories sales were five times that of Amazon, providing a wide lead in a logistically challenging product category that features a high exchange rate,” the new ranking says. “By next year, Wall Street analysts estimate that Amazon will overtake Macy’s as the largest U.S. retailer of apparel and accessories, with sales of $28 billion in the category.” 

But Amazon isn’t the only problem. Department stores are also challenged by the fast-fashion wizardry of brands like H&M, Zara and Uniqlo, as well as companies like Coach and Michael Kors cutting back on department-store distribution. “With key partnerships that help differentiate the customer shopping experience under threat, the historical outperformance of department stores versus the S&P 500 has evaporated over the last 18 months,” it says....