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Facebook and Macy’s Holiday Partnership Is a Testing Ground for Both Brands

Sometimes opposites attract and in the case of Macy’s and Facebook, that tension is all part of the allure.

The social media giant is partnering with the retailer to bring 100 small ecommerce wholesale iphone businesses across the country to a pop-up area in nine different Macy’s stores as an opportunity to bring the digital world into the physical and merge the two experiences. Macy’s meanwhile gets to test whether ecommerce companies can draw in customers to the area and see how a new type of merchant can work with a retailer like Macy’s.

Earlier this year, The Market @ Macy’s debuted, a rotating pop-up shop where different brands are showcased throughout the year. As part of the partnership with Facebook, the social media giant is taking over 50 percent of the space of The Market @ Macy’s. Running through February, the nine locations include Macy’s flagship store in New York, plus Pittsburgh, Atlanta, Fort Lauderdale, San Antonio, Las Vegas, Los Angeles, Seattle and San Francisco. The 100 brands include companies like Love Your Melon, Bespoke Post and LuMee.

“Ninety percent of transactions during the holiday season are done in-store and while digital is growing, it felt like a great way to bring and give some of these small business owners a chance they wouldn’t have necessarily had otherwise,” said Michelle Klein, director of North America marketing at Facebook. “For Macy’s, it’s bringing in new and excitement for customers and generating interest here in the store.”

Thamar Campbell, director of The Market @ Macy’s, said the partnership is in line with the retailer’s focus of “keeping the customer first,” and not just giving them what they want to shop for this season but also inserting an element of discovery into it. And while Facebook is taking over some of the space in The Market @ Macy’s areas, the ecommerce companies will be alongside other brands, like Bose and Ferrari, that aren’t part of the relationship.

“The market is one small piece of everything that’s going on in the house,” Campbell said. “Within this small piece, our attention is fully to create theater for our customer and allow them the opportunity to discover these new brands that they wouldn’t have had the opportunity to at least in the physical space before.”

The brands chosen for the pop-up were part of an open enrollment call put out by Facebook, where any brand could apply, said Klein. However, Macy’s then picked the brands that would participate and were qualified based on merchant criteria such as stock, merchandising and what customers in each of the different locations are looking to shop for. Not every single pop-up shop across the nine stores will look the same; for example, Charleston Gourmet Burger Company’s burger sauce is available only in New York and San Antonio.

As part of the debut of the pop-up, Facebook has about 600 ads in 115 locations in Grand Central, advertising the space. More ads on Facebook and Instagram will come later in the year, along with free digital ads built by Facebook’s creative shop for the brands part of the pop-up to use as well.

“We’d love to see all of these products sell out here and online,” Klein said.

Matt Kaden, managing director at MMG Advisors, a retail financial advisory firm, said the partnership is a test of whether Facebook can “move people from digital to retail.” For Macy’s, the retailer is using its own retail space to “test and learn” and change how people think and talk about the company—as well as not over inventorying.

“I think that Macy’s is smartly going after the marketplace and the beta opportunity, and to utilize their real prime real estate,” Kaden said. “They don’t have the same draw as an Amazon or Alibaba or JD have online, but Macy’s has the benefit from optimizing their spaces differently and being part of the conversation.”

For some of the brands involved in the pop-up, landing in Macy’s is a retail “dream come true,” like for Charleston Gourmet Burger Company. Though the food business is already in Walmart, Kroger and Lowe’s, Monique Wilsondebriano, co-founder of Charleston Gourmet Burger Company, said Macy’s is “a whole other level of retail.” It’s also giving the company a chance for consumers to hold and see their product for the first time.

“If you’re in Macy’s, I feel like you’ve kinda made it,” Wilsondebriano said. “It’s an amazing opportunity.”

Bradford Manning explained that for his company, Two Blind Brothers, which focuses on creating clothes to support the Foundation for Fighting Blindness, getting into Macy’s is a way the company can get into brick-and-mortar without spending the resources to open up their own store.

“To be at 34th and 7th in Macy’s, which is like the most legendary retail space in the world bar none, as a small brand, two guys that wanted to help the Foundation for Fighting Blindness and make some soft shirts, it’s like a dream come true,” Manning said. “We’re trying to do just things where we can get the most scale possible.”

“What we want to do with this is really create joy around the holiday season and create delight and some surprise and do what Facebook does, which is connect people with brands they love and brands with the people who are looking for them,” Klein said.

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