As retailers focus more on the importance of brand structures in driving multi-channel strategies, Federated Department Stores Inc. said today it is realigning Macys.com and Bloomingdale's By Mail to once again operate directly under their namesake store divisions. "We believe there is greater potential in more closely aligning these direct-to-customer channels with the marketing strategies of the department stores," said Terry J. Lundgren, Federated's president and COO.
Federated had moved Macys.com and the Bloomingdale's catalog unit outside of their respective branded divisions and into a corporate-serving Federated Direct unit in 1999, following Federated's acquisition of the Fingerhut Companies, which included several catalog and e-commerce retail operations. Macys.com was intended then to support all of Federated's e-commerce operations. "When direct-to-customer was a larger part of the business, it made sense to have Macys.com focused on all e-commerce, bringing the brands together," a spokeswoman says. "Today it's a much different world." Federated sold its Fingerhut assets last summer.
Under the new alignment, Macys.com President Kent Anderson will report to Macy's West President Michael J. Osborn effective March 1. This will enable Macy's to exert more direct control over a multi-channel strategy that supports the Macy's brand, such as better coordinated cross-marketing and cross-merchandising strategies, the spokeswoman says.
Jim Okamura, a retail analyst with J.C. Williams Group in Chicago, says the realignment makes sense, as more retailers are being organized into a brand structure instead of dividing a brand into distinct channels that often don't coordinate marketing and merchandising. "This is positive for Macys.com," he says. "Many of the barriers to multi-channel integration are internal. In many cases, getting the online management team together with the stores management team was awkward. They weren't communicating and weren't aware of the other's activities."
Okamura adds that the move toward a brand-based multi-channel organizational structure is emerging as a new best practice for the retail industry.
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