Macy's
Description of Macy's business, market and innovation competitors
They analyze a large amount of different data points, such as out-of-stock rates, price promotions, sell-through rates etc. and combine these with SKU data from a product at a certain location and time as well as customer data in order to optimize their local assortments to the individual customer segments in those locations.
Competitive advantage and innovation results
Macy's is using the Differentiation Strategy according to the Porter’s 3 strategies model. The market is very competitive and already saturated. It is hard to differentiate themselves with the products itself; consequently, it is the quality of service that Macy's is targeting. Macy's main target is to offer more localized, personalized and smarter retail customer experience across all channels. In order to achieve this, they use Big Data among others to create a personalized customer experience including customized incentives at checkouts. Macy's increased its analytical capabilities with implementing the SAS® Enterprise Miner™ resulting in providing valuable customers with the right promotions in order to serve them the best way possible. Even more, they are now capable of sending hyper-targeted direct mailings to their customers, including 500.000 unique versions of a single mailing! Successful differentiation is displayed when a company accomplishes either a premium price for the product or service, increased revenue, or the consumers' loyalty to purchase the company's product or service (brand loyalty). In Macy's case, they could brilliantly achieve the later two of those KPI's. The new centralized online fulfillment centre came at a cost of $ 170 million. However, thanks to Big Data, they increased store sales with 10 percent over the past years. In 2012 alone, Macy's reported sales of $ 27.7 billion. Taking into account that merely three years ago they were still relying on Excel for insights, this is a noteworthy
They analyze a large amount of different data points, such as out-of-stock rates, price promotions, sell-through rates etc. and combine these with SKU data from a product at a certain location and time as well as customer data in order to optimize their local assortments to the individual customer segments in those locations.
Competitive advantage and innovation results
Macy's is using the Differentiation Strategy according to the Porter’s 3 strategies model. The market is very competitive and already saturated. It is hard to differentiate themselves with the products itself; consequently, it is the quality of service that Macy's is targeting. Macy's main target is to offer more localized, personalized and smarter retail customer experience across all channels. In order to achieve this, they use Big Data among others to create a personalized customer experience including customized incentives at checkouts. Macy's increased its analytical capabilities with implementing the SAS® Enterprise Miner™ resulting in providing valuable customers with the right promotions in order to serve them the best way possible. Even more, they are now capable of sending hyper-targeted direct mailings to their customers, including 500.000 unique versions of a single mailing! Successful differentiation is displayed when a company accomplishes either a premium price for the product or service, increased revenue, or the consumers' loyalty to purchase the company's product or service (brand loyalty). In Macy's case, they could brilliantly achieve the later two of those KPI's. The new centralized online fulfillment centre came at a cost of $ 170 million. However, thanks to Big Data, they increased store sales with 10 percent over the past years. In 2012 alone, Macy's reported sales of $ 27.7 billion. Taking into account that merely three years ago they were still relying on Excel for insights, this is a noteworthy