Case Study Macy's
Macy’s Department Store Reposition Case Study
By
Tina Parker
In Partial Fulfillment of Course Requirements for
BUS 530A Marketing Management
California Baptist University
Dr. Natalie C. Winter
May 21, 2013
Executive Summary The case study is Macy’s Department Store Repositioning. The key problem is that the traditional department stores sales and profits are declining. There are specialty stores, discount stores, and online stores that offer similar products at a fraction of the cost for the most part. However, in the declining market for the department store industry, Macy’s consolidated stores, established a national department store and continues to make a steady profit. It is usually the time to divest, sale, or change product mix of a company when a company enters in a mature or declining phase in business. The marketing strategies used to do the analysis were the PEST and product life style. PEST examines the political, economic, social and technology of a firm to determine a company’s strengths, weaknesses and position in the industry. In the future, the Affordable Health Care Act will affect Macy’s in additional costs, which is political. The economic conditions will continue to be an issue as disposable income levels are not at the levels of 2006 prior to the recession. The social norm is to not like change. As Macy’s changes to improve sales, cut expenses and maintain its competitive advantage, some customers may not just care for it and shop online or in a discounted store. And, the technology for Macy’s to implement will be accepting debit cards from a hand held device vs. cash register, to be able to advertise as a customer walks in the door with their phone and in corporate user friendly replenish of inventory if an item is sold out. The product life cycle of the department store is mature and declining, due to declining sales. Furthermore, according to estimates, market share has eroded to 7 per cent, which is
By
Tina Parker
In Partial Fulfillment of Course Requirements for
BUS 530A Marketing Management
California Baptist University
Dr. Natalie C. Winter
May 21, 2013
Executive Summary The case study is Macy’s Department Store Repositioning. The key problem is that the traditional department stores sales and profits are declining. There are specialty stores, discount stores, and online stores that offer similar products at a fraction of the cost for the most part. However, in the declining market for the department store industry, Macy’s consolidated stores, established a national department store and continues to make a steady profit. It is usually the time to divest, sale, or change product mix of a company when a company enters in a mature or declining phase in business. The marketing strategies used to do the analysis were the PEST and product life style. PEST examines the political, economic, social and technology of a firm to determine a company’s strengths, weaknesses and position in the industry. In the future, the Affordable Health Care Act will affect Macy’s in additional costs, which is political. The economic conditions will continue to be an issue as disposable income levels are not at the levels of 2006 prior to the recession. The social norm is to not like change. As Macy’s changes to improve sales, cut expenses and maintain its competitive advantage, some customers may not just care for it and shop online or in a discounted store. And, the technology for Macy’s to implement will be accepting debit cards from a hand held device vs. cash register, to be able to advertise as a customer walks in the door with their phone and in corporate user friendly replenish of inventory if an item is sold out. The product life cycle of the department store is mature and declining, due to declining sales. Furthermore, according to estimates, market share has eroded to 7 per cent, which is
References: Johnson, H. H. (2011). Macy 's Department Store Repositioning. Richard Ivey School of Business The Univerisyt of Western Ontario, 1-8. Walker, J. O., & Mullins, J. C. (2014). Marketing Strategy Eighth Edition. New York: McGraw-Hill Irwin.