The chief executive of Federated Department Stores Inc., which will soon change its name to Macy?s Inc., said he believes strategic changes were made too quickly at former May department stores, which are still struggling under the Macy?s nameplate.
The company?s strategy for boosting sales is the right one, though, CEO Terry Lundgren said.
Shareholders approved the name change at the Cincinnati-based retailer?s annual shareholders meeting Friday.
Federated reported a first-quarter profit of $36 million, or 8 cents per share, but its adjusted earnings missed Wall Street estimates as sales remained weak at stores taken up in its 2005 acquisition of the May Department Stores Co.
?I think we threw a lot of change on the May company stores very quickly,? Lundgren said.
The biggest change at the May stores was in curbing promotions such as sale coupons, Lundgren said. Promotions will return to a level closer to what they were before the retailer pulled back on them this spring.
Lundgren said that over time that promotions at the former May stores will more closely resemble those at the legacy Macy?s stores.
?We?re going to slow the rate of change in the fall season so that we can get the consumers more used to more gradually getting off of the coupon business,? Lundgren said.
Lundgren also said there would be changes in the advertising media mix, such as doing more TV and newspaper advertising as opposed to direct mail.