advertisement
advertisement
advertisement

This is page 2 of:

Macy’s Stops Reporting Online Stats, Blames Too Much Channel Blur

February 27th, 2013

One problem, for example, is the balancing of shipping cost versus markdown delay. If the goal is to ship to an online shopper in Baltimore and the desired product is in a store in Washington, D.C., as well as a store in Portland, Oregon, which one does the shipping? Even though it’s a lot less expensive to ship from Baltimore, the system must consider how much inventory each store has on hand, how old it is and, therefore, how much will be lost when those items go on markdown. How much will it likely be marked down? Is it more than the increased shipping costs from Portland?

“It’s a matter of setting the right clearance price strategy at every location. Those rules don’t apply everywhere,” said Jim Sluzewski, Macy’s senior VP for corporate communications. “At what point do you decide to clear an item because it clearly isn’t selling well? The initial perception was that if we studied it, we could figure it out pretty quickly. We found that mapping the process wasn’t as simple as we thought.”

The CFO said Macy’s has been trialing with a handful of physical stores and giving far too little inventory, forcing the store to depend on online order fulfillment. “We’ve done a lot of experimenting this year with goods that are in the stores for which we don’t have (in-store) inventory backing it up. A lot of those initiatives have done very well,” Hoguet said. “We’ve also experimented with putting merchandise online that we don’t have inventory in the online warehouse, as the inventory is only in stores. In the fourth quarter, we had about 700 items that we tested this with very successfully.”

During the analyst call, Hoguet also reported:

  • More Item-Level RFID
    Macy’s has pushed RFID for years, but the chain said it will ramp up sharply this year. “By the fall, we’re hoping to have roughly half of our replenishment business utilizing RFID. Our stores will all be enabled by early in the fall, and we’re just waiting as the vendors come up and begin to tag the goods. So replenishment is roughly 30 percent of our business. This could be very important as we go forward,” she said.

    And in a different RFID use case, Macy’s will be auditing shoes on display. “We’ve rolled it out now to all of women’s shoes across the company. And next up will be luggage and men’s shoes, which will be up this summer.”

  • Mobile Doesn’t Convert As Often
    Macy’s is experiencing lower conversions on mobile devices than laptops/desktops. That theory has been widely discussed, but Macy’s is the first to report those results definitively. “We are benefiting from very large increases in traffic on the Web site but also in conversion. The increase in conversion is particularly encouraging given the growth in mobile traffic, where conversion does tend to be lower than on desktops,” Hoguet said.
  • We Don’t Need No Stinkin’ Specialists
    In discussing staffing strategy, Hoguet said the chain initially wanted to use specialist staffers to fulfill orders, on the rationale that they would be faster. That turned out to be untrue. “One of the early learnings was that we had thought we would have special-purpose people doing the fulfillment activity. And we discovered that we were better off using the support associates we had, because they better understood the merchandise, and people who were putting merchandise on the floor are going to find it much quicker if they understand it. So we did change the staffing model some.”

  • advertisement

    Comments are closed.

    Newsletters

    StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
    advertisement

    Most Recent Comments

    Why Did Gonzales Hackers Like European Cards So Much Better?

    I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
    Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
    A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
    The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
    @David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

    StorefrontBacktalk
    Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.