Multichannel Strategies Differ for Retailers

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NEW YORK -- Teaching an old dog new tricks is not easy, and who better than retailers to know that?


The 100-year-old Macy's is a prime example. A single online store reflects its e-commerce business, but its Macy's East and Macy's West divisions are silos within the same company.


"They actually represent the biggest challenge to me rather than the competitors," Gene Domecus, senior vice president of e-commerce for macys.com, said of the divisions.


Domecus was addressing a packed room of e-commerce executives attending the National Retail Federation's Shop.org 2003 Members' Forum yesterday in New York. He was part of a panel discussing the right multichannel retailing strategies. Also on that panel were the direct department heads of the 64-year-old Recreation Equipment Inc. and the century-old Saks Fifth Avenue.


Each retailer has its own ways to shake hands among the store, catalog and online channels. But that has come after a lot of trial and error.


Macy's entered the direct business by allowing its two divisions to go their own ways. Macy's East launched a catalog and Macy's West launched a Web site that grew out of a wedding registry. That strategy bombed. The catalog was dumped in 2001.


"We're actually doing more business without the catalog than with it," Domecus said.


Inventory is another area where macys.com is independent of the retail divisions. It buys and holds its own inventory in a central repository.


Saks has a different strategy. The Birmingham, AL-based retailer last year closed its 20-year-old store catalog. It now uses a store book as a catalog, but without the ability to order directly.


"The good news is that it's all the same merchandise," said Denise Incandela, senior vice president of business development at Saks Direct.


Saks' goal is to maintain a consistent customer experience across all channels, she said. Plans under consideration include mention of store events online, fashion shows on the site and the existing ability to view and pay bills on Saks.com.


"I could see us experimenting with our direct channel to test new categories vs. the stores," Incandela said.


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