By  on July 1, 2009

Jeff Gennette is clairvoyant. Thanks to some sophisticated new tools, the recently installed chief merchandising officer for Macy’s Inc. is unearthing important information that will reveal the choicest growth opportunities for the $25 billion company.


Working in tandem with his counterpart, Julie Greiner, chief merchandise planning officer, the two executives have been charged with implementing the corporation’s My Macy’s localization strategy at its more than 800 stores across the country. My Macy’s, which was rolled out nationally last month, provides the company with detailed sales information which can then be exploited. It’s the strategy the company turned to when it centralized operations earlier this year, and it also addresses vendor complaints the retailer was unwieldy and not a good partner.

In their first interview since the completion of the restructuring, which resulted in the elimination of Macy’s four operating divisions, Gennette and Greiner said they’re encouraged by what they see in their crystal ball.

“We are the curators,” Gennette explained. “We set the national strategy in terms of vendors, trends and classifications. We see the future and then [our colleagues] in the field get that information and shape it to the local level.”

My Macy’s employs 1,600 people across eight regions and 69 districts. The district planners are the “analytical engine,” while the district merchants are the merchandising and execution arm of the company. Adding the merchants and planners “work in tandem,” Gennette said the New York-based team decides how the floors should be merchandised as well as their adjacencies — information that is then adapted to each community.

Greiner said it’s a lot like “the old days” of retail, when merchants in their local communities knew their customers and the sales associates. “We’re really going back to that intimate knowledge,” Greiner said. “Then we’re leveraging technology as a communication tool.”

The way it works, she said, is a merchant in a particular store or district will make a request — for example, more woven shirts in Florida. They must provide reasons for the request and the anticipated outcome. “If the dress business is hot, a buyer will say, ‘We want to increase our assortment by X percent so I need more breadth or depth,’” she said. During the pilot, the company received 13,000 requests from the field and nearly all were approved.

“We’ve made a commitment to say ‘yes’ 95 percent of the time,” Greiner added.

All told, between 10 and 15 percent of the assortment throughout the company is localized, she said. “Color, print, weight and flow are all local so even if it’s not a different assortment, it might be different timing or different product from the same vendor.”

Although the process has the potential to be cumbersome within such a large company, proprietary software developed for My Macy’s actually eliminates confusion and allows for merchandising down to a micro level. During the pilot, for instance, Betsy Ann Chocolates, a local candy vendor in Pittsburgh, went out of the retail business and the district planner and merchandiser in that city decided to add the line to 10 local stores. “It’s a small thing for the company, but big for that community,” Greiner said, “and it’s working.”

Gennette added: “There’s great passion within the local communities and My Macy’s is the tool that gives us the chance to [seize] the opportunities and gain market share.”

Macy’s also retained some key “outpost merchant groups in the field,” Gennette said, including those in Southern California, the action sports mecca, and Hawaii.

“The vast majority of the merchants are in New York,” Gennette said, “but where we felt it was important, we retained people.” And these merchants are using their skills to “work on the broader strategy” for the corporation as a whole, both in terms of national brands as well as private label. “They’re working with the vendor and private-label teams to develop product, timing and flow of receipts,” he said.

Gennette said in the past, Macy’s was widely criticized by vendors “who said we were not an easy partner. We heard that we were slow or not on the same page. So one year ago, we took seven vendors and worked through our issues.”

One of the vendors that has been at the forefront of the My Macy’s initiative is Polo Ralph Lauren Corp.

To access this article, click here to subscribe or to log in.

To Read the Full Article
SUBSCRIBE NOW

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus