Macy's On Omnichannel
This month’s issue of Apparel digs deep into both multichannel and omnichannel apparel operations and commerce, and rightly so given the near blinding spotlight on both these strategies.
It is generally agreed that multichannel or cross-channel can mean selling across and engaging across the categories of brick and mortar, catalog, online, mobile, etc., whereas omnichannel, as Paul Magel, president, application solutions, Computer Generated Solutions, defines in this issue’s Thought Leadership report (“Omnichannel Retail: The Key to Brand Enhancement”) extends “beyond social networks, email, Web and mobile to include the entire customer experience. It encompasses things such as in-store displays, kiosks, interactive television and set-top boxes — everywhere there’s a point from which a brand can touch the consumer.”
And as Leslie Hand, research director, IDC Retail Insights, shares in the same report: “This is the omnichannel ‘doing’ year, when retailers — including apparel retailers — are moving past interminable planning and undertaking omnichannel initiatives, if they haven’t already.”
For those tracking the omnichannel scene, there is perhaps no bigger poster child than Macy’s. At the recent Annual Executive Summit of the American Apparel & Footwear Association, Macy’s chief merchandising officer Jeff Gennette shared a combination of recent successes, data points and future plans that provide robust market insight no matter where you sit in the supply chain. To wit:
• The Macy’s omnichannel customer spends five times more than its online only customer and two times more than its in-store only customer.
• Gennette says Macy’s “always places the customer at the center of all decisions.” And he advises to localize, but have a unified vision.
• Macy’s considers itself to be “branded entertainment.” We hear so much about the customer experience and Macy’s is working to push the envelope. Think about its sponsorship of the reality TV show “Fashion Star,” which allows viewers to shop the top styles online the next day. There’s also the Macy’s iHeartRadio Rising Star competition. The retailer features “Backstage Pass” with celebrities on its website. The “What’s In Store?” “retailality” comedy showcases Macy’s “employees,” guest celebrities and of course plenty of product to buy. And the iconic “Macy's Day Thanksgiving Day Parade”? — why, yes, Virginia, Macy’s is exploring whether it can create a direct tie-in to instant purchases.
• To connect with the omnichannel consumer, Macy’s is looking to build more traction with millennials. Gennette says this group of 18- to 34-year-olds represents 23 percent of the U.S. population or 73.4 million people. Macy’s created its Impulse brand for the upper age end of this group. It also has launched an exclusive brand, VIP Girl, and the new Marilyn Monroe brand (for women who dress for men) in 159 doors.
• Macy’s is working to improve its online buying experience. Whereas in 2010, 100 percent of total traffic started at its home page, now 44 percent of browsers are going directly to product pages. And this year, it is expected that mobile will drive 65 percent more traffic.
• Traditional media and in-store signage are driving online behavior. E-circulars and tablet catalogs are driving incremental sales using traditional media. In-store technology is driving in-store and online sales.
• Technology will enable the magic, says Gennette. “RFID is going to be a huge win for us and will be as important as UPC.”
• “The dream is next day delivery,” says the CMO.
• “We can’t walk away from the opportunity to make our in-store experience richer,” says Gennette. Case-in-point are the numerous special events held, from flower shows to trunk shows to charitable tie-ins to programs that support returning military veterans and more. He calls it “building better bricks.”
• Underpinning this growth culture is “talent as a business strategy.” From recruiting at top schools through relationship building and retraining current employees, to cross-training, succession planning and both formal and informal recognition programs, Macy’s is focusing on its people. “It’s important to leverage the power of senior-level exposure, and open up banks of time to do that,” says Gennette. And he says when it comes to listening to and engaging with your employees, the small stuff matters.
Susan S. Nichols is publisher of Apparel.
She can be reached at [email protected]