Macy’s and Bloomie’s Seek Retail Technology Edge
Macy’s, Inc. is going all omni-channel and the retailer took the unusual step this week of issuing a press release to announce ways it is testing and deploying various technologies in stores and online to gain a competitive edge in the marketplace.
“We are committed to leading in the adoption of technology that resonates with our customers, recognizing that not every idea will prove to be successful in the long-term,” said Terry Lundgren, chairman, president and chief executive officer of the company, in a statement. “We are using technology in our stores to mirror the online shopping experience, and adding functionality and content online … to ensure Macy’s and Bloomingdale’s are accessible no matter how or when our customers prefer to explore or shop.”
Among the items on Macy’s technology test and/or deployment list include:
- Free Wi-Fi at stores across the U.S.;
- Testing digital receipts in 50 locations;
- Providing associates with tablets in Macy’s and Bloomingdale’s stores to test how the devices can assist in improving customer service;
- Live customer service chats on macys.com and bloomingdales.com;
- Online denim fit technology;
- Beauty Spot cosmetics kiosks.
Discussion Questions
Discussion Questions: What retail technologies being tested by Macy’s do you think hold the greatest promise for the company and for other merchants? Is Macy’s unusual in its commitment to use IT as a means to bolster its top line as well as bottom line results?
These things are all great but I wanted to comment on the free Wi-Fi feature. Providing free Wi-Fi at stores is an added convenience to your customers but will do nothing to promote sales. In fact, you are adding yet another distraction for your customer. Instead of looking at displays and signs, your customer will now be fiddling with their phone or tablet trying to log in and when they are logged in, your customer now has an opportunity to surf the net (possibly comparing your prices to a competitor), check email, make free long distance calls to Japan, etc. Why would you provide an additional distraction to your customer? All the free Wi-Fi at Starbucks, McDonald’s and other food places have given new meaning to the term ‘No Loitering, 20 min time limit’! As for the other technologies that they want to employ, if it adds to sales, then go for it. If it’s a distraction, shelve it.
This is a very impressive list. It will be even more impressive if the tech-enabled associates are incented to actually assist customers.
Nordstrom certainly has taken a leading position as well. The rest…well, they’ll follow at some point, or drift into irrelevancy.
Ever since the early 2000s, two Wall Street analysts have helped spread the news to investors about the value of technology in supporting top-line and bottom-line results. Bob Buchanan (who I haven’t seen since AG Edwards got swallowed up) and Deborah Weinswig of Citi have done a fabulous job highlighting the difference technology really does make.
Good for consumers, good for the retailer and good for investors. What could be bad?
Somehow, after the ongoing Target debacle this week, I don’t have a lot of faith when it comes to technology and department stores. Almost sounds like an oxymoron today. I am sure it will change quickly once Target takes the black eye off its logo.
Macy’s technology needs to concentrate on added sales and drawing customers in the store.
This is a worthwhile initiative, in large part because Macy’s regional department store competitors tend to be laggards on IT spending. Macy’s is also being proactive about the eventual “reinvention” of the JCPenney store experience, given its new CEO’s background at Apple. (Let’s face it…most retailers have been too slow imitating The Apple Store’s use of handheld devices to speed the checkout process.) Finally, Macy’s will want to continue pouring IT investment behind the scenes to push its “My Macy’s” program to new levels. All in all, smart leveraging of Macy’s national footprint and expense structure.
I applaud this commitment to the future. One thing — giving sales associates on the floor iPads only works if these people are visible. They need to commit to doing a better job of that in Macy’s.
Retailers should be designing a holistic marketing, merchandising blueprint to provide its shoppers/customers relevant and personalized experience regardless of the touch-point and then integrating the appropriate technologies to deliver on this promise. Technology is the enabler and should be used as part of a broader solution. Retailers (and brands) should be asking themselves, ‘How do we want to be doing business with our customers 7-10 years from now in this evolving digitally empowering environment?” Simply trying different technologies as independent solutions and adopting those that resonate with customers is not an omni-channel solution.
This fragmented approach may have a short-term benefit, but it will never reach the potential of a truly integrated, intelligent solution that will address the evolving expectations of your digitally empowered customers. Retailers should be designing omni-channel solutions that keep them relevant as a trusted source to their customers for years to come.
The technology with the most possibilities is the tablet in the hands of the associates. Apple’s use of this form of technology improves the functionality of the associate as well as add a little whiz-bang to the transaction. There’s any number of paths that this could go down.
As Joel points out, however, there needs to be an associate on the floor. Not one of Macy’s strengths.
All of these technologies, if working properly, can add to the customer experience. Apple has demonstrated this for years in the Apple stores. I expect more retailers to adopt this model. The shopping experience should be seamless from cyberspace to floorspace. I look forward to visiting Macy’s to see how it works.
Yes, some of Macy’s department store competitors may be laggards in adopting technology that improves their top line and profits. But most other major retailers are looking for ways to use information technology to improve virtually every aspect of their businesses. In some instances the customer benefits directly and in others indirectly. The only danger is to overdo technology while losing the personal touch with customers.
In the last few years Macy’s and Bloomingdale’s have made impressive strides in improving their merchandise selections and service. This will likely be another step in the company’s overall growth.
Providing associates with tablets gives associates access to all the content of the macys.com to support the sales process to do up selling and cross selling, plus the ability to access the inventory online as they do the selling. That will improve the capability to sell, and provide a better customer service.
I think all of these initiatives are very worthwhile. I think it’s also important that Macy’s recognizes that not all of these things will resonate with customers.
That suggests to me a recognition that these initiatives are tactical, not strategic. Too often, technology seems to be seen as an end in itself, rather than a tool to achieve strategic goals.
For Macy’s, along with the rest of the department store sector, the strategic mission continues to be to win back the fashion shopper and re-establish the long-term relevance of the format. It’s got to be about the merchandise and the merchandising, first and foremost.
What’s not to like? They have put together a menu of services that looks pretty good. However, one hopes that store associates will be able to effectively make this program work. If they do, if the training and motivation are in fact in place, this program could be a winner.
It sounds like Macy’s is on the right track. They must regard their stores as an asset and leverage technology to maintain that reality. We are in transition. For me, the brave new world of total online shopping cannot come too soon, but for many others the thrill of going out to the store remains a pleasure. Instead of Brick and Mortar operators sticking their heads in the sand, they need to embrace technology and figure out how it can be used to make their stores more appealing. Even I can appreciate the ability to visit a local store when I need something right away as a gift, but don’t quite know what to get.
As far as the new technologies, I think the whole size thing remains a deterrent to online shopping. Personally, I would rather walk to the dressing room and reject something without ever taking it home than order it online and then find out it has to be returned. The Macy experiment with jean sizing will be interesting to watch. If they can figure out a way to get customers’ real measurements and then apply them to the different manufacturer styles it will make it easier for online shoppers. This is especially true in an environment of volatile commodity prices that is causing manufacturers to modify designs in order to reduce waste and commodity usage. Of course, even following my dressing room model I managed to get a couple pairs of shorts this year whose pockets had been so severely crimped I have lost at least $20 in change.
I don’t know if the world will ever totally transition to online shopping. I think there will always remain a sense of adventure in walking around a store or mall. The challenge will be continuing to keep stores relevant in the shopper’s mind. Technology can help for a while as certain technologies remain too expensive for home use. But we all know what happens to the price of technology. At the extreme, some high-end consumers will soon have holographic displays complete with environmental technology that allows them to simulate a desert or mountain top in their entertainment room. These shoppers may be ready to forgo the store visit altogether.
I wish them well, but Macy’s main problem — one of them, anyway — is staffing: too few to really be a full-service department store, too many to really be a discounter. I think the question with giving tablets to the 2-3 associates assigned to a 60,000 sq.ft. floor is not so much “will it make them twice as helpful,” but rather “will it make them only half as helpless?”
The greater challenge is going to be integrating systems so that the total shopping experience is seamless. How much shopper/associate time is spent looking for things “that should be there,” but aren’t because updating is not timely, or waiting while the sales associate is calling for approvals because the register has different info than the product code/tags, or as mentioned, finding the associate to assist?
Watch Macy’s! They are completely serious about leading the way with technology, and I’m aware of some other startling announcements that are going to made. If Macy’s is one of your competitors, you’d better look at upping your game.
We continue to hear about more and more large-scale retailers incorporating new technologies, and “the online experience” into their business. It’s essential for many reasons, one of the most important being, consumers’ eyes are there, whether it’s online or via mobile.
In Macy’s case, I particularly like the fact that they launched these new technologies, but did so wisely, to align with their customers. The denim-fit technology and cosmetic kiosks are exactly what their customers are looking for. The ability to see how a room with look “after” a DIY project would be a great way to utilize augmented reality for a home improvement retailer, as another example.
It’s about brands getting involved in these forms of nontraditional marketing, but not just jumping on the bandwagon; their focus needs to be on what kind of experience would best suit the customer.
Free Wi-Fi will help deliver better connectivity to any custom in-store app or other short-range/in-store promotion. So I would expect Macy’s to leverage this technology with in-store offers, product promotions and other engagement initiatives. This may help them keep the customer in the store for longer periods of time and boost ticket sizes. They should also be able to add additional enticements to their frequent/loyalty card members through these technologies and some location-based marketing. All good initiatives and it will be interesting to see how they utilize the iPads into improved customer interactions.