DM may address retail woes

Macy's locations in these markets will be grouped into 20 newly formed districts of about 10 stores, compared with the average of 16 to 18 stores currently overseen by each regional manger. District-based planners will provide market-specific intelligence to division planning offices. Additionally, more resources will be provided to local markets for special events and to enhance customer service.

In essence, Macy's plans “to drive sales growth by improving its knowledge at the local level and then acting quickly on that knowledge,” said Terry J. Lundgren, chairman and president/CEO of Macy's, in a statement. The company could not be reached for comment by press time.

Britt Beemer, chairman of America's Research Group, said, “Direct marketing has now become a better opportunity [than national advertising] because retail­ers can market special deals to their cus­tomers that they maybe couldn't afford to offer to the general public.”

In fact, Beemer continued, for retailers with a strong database of customer and prospect names, direct marketing may be “the most efficient place to go” at this point in time.

Shifting marketing dollars into direct marketing from national advertising “could become a trend because direct marketing dollars are very measurable,” said Michael Sherman, senior advisor at investment bank Peter J. Solomon. This is especially true now that more main­stream brands are moving into direct marketing, he continued.

Sears Holdings Corp., for example, made a major commitment to direct mar­keting last month by naming OgilvyOne its direct marketing and CRM agency of record, Sears' first CRM agency appoint­ment. Direct and e-mail were previously handled by multiple agencies.

The appointment is part of a long-term strategic effort on Sears' part to deliver a higher return on investment from its marketing programs, according to a statement from OgilvyOne.

All of these developments can be traced to retailers looking for help both to drive sales and to save money wherever they can because of the current economic en­vironment. Cutbacks were rampant this month in the retail sector following one of the worst holiday seasons in years.

Anew report from Forrester Research, titled The Connect Agency, highlights how agencies are falling short of helping marketers nurture consumer connec­tions and creating pull interactions, strat­egies they will need to develop in order to survive.

According to the report, about 55% of marketers believe that their agency is well-equipped to help with Internet advertising. However, 95% of agency executives believe they are handling the area well.