omnichannel - macy's case study

Omni-channel: Macy’s Case Study

Prepared by Kevin HuangFeb 5, 2016

The retail industry is going through a tough period

Source: http://goo.gl/ig1na4

Macy’s brand positioning• The “Great American Department Store” opened in 1858 and is now a global brand

• 887 total stores• 771 Macy’s in 46 states• 37 Bloomingdale’s• 13 Bloomingdale's outlet• 66 Blue Mercury

• 3 stores across Guam and Puerto Rico• New off-price format “Backstage” is being tested in 6 locations New Jersey and New York• Positioned in the market as a better department store between Kohl’s, JCPenney and Bloomingdale’s, Nordstrom, Saks, Neiman Marcus• Grew through combination of organic growth and acquisition• Aggressively expanding digital capabilities and services across channels while regularly refreshing their store portfolio

Interbrand’s best retail brands 2014 – North America

Macy’s has a long history of business innovation

Macy’s was the first American retail store with modern-day escalators. The first to post prices in plain sight. And in 1872, they were offering free, same-day home delivery – via horse and wagon.

Macy’s Chief Omni-channel Officer R.B. Harrison

(click to play the video)

Macy’s goes omni-channel & digical

Key strategy for growth: focus on omni initiatives

• Initiatives and technologies ranging from consumer-facing smart fitting rooms to RFIDpilot programs

Macy’s and Bloomingdales adopting Apple Pay Unveiling the Macy’s Wallet / Bloomindale’s Wallet through the mobile apps to easily store and access offers Integrating buy online/pick-up in store Order fulfillment across store portfolio and distribution centers Testing same-day delivery for items purchased online and through mobile app Developing new technologies at the Idea Lab Handheld POS devices to engage with customers and manage inventory ShopBeacon technology in stores to improve sales providing more personalized sales to Shopkick app users

Source: Macys, BusinessWire

M.O.M. is Macy’s customer engagement strategy


M.O.M is the blueprint for strategy refinement• M.O.M. remains the blueprint for the Macy’s brand today – with each element of the strategy coming closer together to work holistically

• Macy’s is no longer operating with a single view of the customer, inventory and business• Macy’s main focus now remains on integrating and refining M.O.M while elevating the in-store experience for customers

• Macy’s is now devoting more attention to localization by enhancing assortment and sales performance by climate zone and getting more granular on ethnic customers• Macy’s is expanding their omni-channel capabilities by delivering a higher level of shopping experience with Buy Online Pickup in store• Magic Selling is also a vital ingredient for tapping the full potential of Omni-channel. Macy’s has new tools and technology on the selling floor to engage customers. Magic Selling is focused new customer touch points to grow sales


Macy’s is investing in the dressing room

• Using high-tech gadgets like tablets to upgrade fitting rooms as a weapon against Amazon• Revamped fitting rooms in women’s swim and athletic department at Manhattan Beach store

Macys Unveils Its 'Magic Mirror'



Omni-channel payments moving in full force• Macy’s is already set up to accept Apple Pay at their stores. • Macy’s also adopted PayPal as a payment option and is rolling out to all stores – integration enables Macy’s customers to checkout online or on mobile using the PayPal button

• In-store customers can also checkout via payment code on the PayPal app, or on the Macy’s app using the mobile wallet, which enables consumers to scan a QR code on their mobile device to complete a purchase in-store• Macy’s has also Partnered with Plenti for customers to ear points at the store, and be able to transfer rewards to other stores

• Integration also enables One Touch, so customers who opt-in can check out online and on mobile without having to type in any payment credentials, usernames or passwords.


And Macy’s is further optimizing omni-channel approach with consolidation & new formats

• Stores closed represent about 1% of Macy’s total annual sales of roughly $28B

• Store will offer a wide assortment of products including men’s, women’s and children’s apparel, shoes and accessories, housewares, home décor and textiles, toys and tech items.


Macy’s omni-channel innovations

First retailer to sign on to use Apple Pay

Improving website and mobile app to make

shopping easier and faster.

Rollout expanded to all women’s shoes. Next luggage and

men’s shoes

For products purchased online to customers in

eight major U.S. markets

Grouping together small gains made of a local level that combined

add up to a big number. Ex. Initiatives achieved strong

performance: Latina, small-footprint stores, millennial shoppers

Omni-channel fulfillment Goods can be fulfilled from warehouses and inventory at stores, with an ultimate goal of faster, and even

same-day delivery.

Launched 13 new millennial brands and expanded 10 existing

ones. Aimed at ages 13 to 22 and 19 to 30

Macy’s links with Google to show mobile users what’s in stock nearby

Adapting digital marketing technologies that leverage a

360-degree view of customer shopping behavior

Connect@Macy’s Centers in-store destinations for online

order pickup being tested. Increased associate staffing

to help customers with styling, product adviceImage Search App responds to

any digitally submitted photo with a similar available at Macy’s

Smart Fitting Rooms equipped with wall-mounted tablets. Selling associates and customers can scan merchandise to

view other colors, sizes, see product info, product ratings/reviews, recommendations on complementary items to

“complete the look.” Customers can tap a button to call for assistance from a sales associate without leaving the room

“Magic Selling”Training, coaching sales

associates to think in omni-channel terms:

selling customers merchandise that may only be available online

Collaborating on merchandising

strategies across all channels

New mobile wallets that enable shoppers to easily store and access offers and coupons virtually, creating seamless,

omni-channel checkout experience for customers in loyalty rewards programs

Shopkick will prompt customers about current promotions and discounts once

they enter a Macy store.

Macy’s omni-channel innovations (continued)

Macy’s has a new app that provides a better way to manage gift registry.

Macy’s new loyalty program, Plenti, is the first U.S. loyalty coalition involving major U.S. brands. Plenti offers opportunities to both incent Macy's current customers to buy more and also to bring new customers into Macy's who enter the Plenti program through the other participating brands

Macy’s millennial strategy

Identify Customer LifestylesEnhance & LocalizeMerchandise AssortmentsRelevant Omni-channelEnvironmentsIn-store ImprovementsOrganizational Structure

EXPERIENTIAL ACTIVATIONS, PARTNERSHIPS

Dorm decorating inspirations,tips & checklists.

Special shopping events. Macy’s brand ambassadors spreading

savings news on campus.

NEW OPENCONCEPT OFFICE

Better collaboration between Merchants, Marketing, Planning

and Private Brands

MARKETINGNew ways to reach, attract

Millennials. Social media focus: Facebook ∙ Twitter ∙ Pinterest

∙ MBlog

CEO-MILLENNIAL BRAINSTORMING

BREAKFASTSCEO Terry Lundgren has monthly breakfasts with Millennials to brainstorm

ways to reach them.

4 LIFESTYLE PROFILESAfter analyzing Millennials’

buying and shopping habits. Profiles are used to develop

Brand assortments.

FASHION MERCHANDISE13 new Millennial brands including

Marilyn Monroe, MADE Fashion Week, Blossom & Clover, Truth or Dare, G-

Star Raw, Maison Jules, QMack

OMNI-CHANNEL INNOVATIONApple Pay, New Mobile Wallet,

Google Partnership, Mobile Users See Nearby Stock,

Website, App Improvement, Image Search App

IN-STORENew Millennial

Departments – Mystylelab (younger), Impulse (older),

Floor moves to create New Destination Zones

Macy’s will host 300-square-foot shops from Best Buy in 10 of its stores in quest for millennials

Macy’s millennial strategy (continued)

Macy’s Digital Edition will leverage the functionality of the tablet experience to introduce customers to an enhanced catalog featuring exclusive editorial content, fashion advice, closer looks at the product and curated product suggestions.

(targeting to customers between 13 and 22)

(targeting to customers between 19 and 30)

Macy’s millennial strategy (continued)

Macy’s marketing – from offline

One tactic the Tourism marketing team uses is by giving a 10% discount to individuals who do not live in one of the five boroughs of New York City. This entices tourists to stop by Macy’s and pick up a treat (with a discount!) to commemorate their visit to the Big Apple.

Macy’s marketing – window displays


Digital catalog TV commercial

Macy’s marketing – to online

Macy’s & Make A Wish

Macy’s & Pink Pony

Macy’s special events

omnichannel - macy's case study

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