Sunday, September 29, 2019
MacyÃ¢â¬â¢s Store Essay
1. MacyÃ¢â¬â¢s and other department stores are faced with imminent problems where sales are declining each year. Due to high competition and many substitutions in the market, company must always analyze, investigate, and plan for decision making. Creating situational analysis is a great way to analyze both the internal and external environments in order to understand the companyÃ¢â¬â¢s capabilities, business environment, and customers. In MacyÃ¢â¬â¢s case, some of the external factors are competition and economy. Since competitors such as discount stores and specialty stores are attracting many customers, MacyÃ¢â¬â¢s need to find a solution to differentiate themselves from others to deliver value. Some of the examples can be lowering prices to meet customer expectations, expand market by using online- shopping, or take a survey to gather which brands or items customers want in MacyÃ¢â¬â¢s department store. Economy is another crucial factor store has to consider. When the economy is healthy, stores tend to worry less, but when the economy is in recession, customers will spend less and find a cheaper substitute items to purchase. Although MacyÃ¢â¬â¢s positioned themselves as upper middle class, company can increase sales by also providing less expensive brands for customers to choose from. As for internal factors, training employees, contract with excellent suppliers, and positive recognized brand will strengthen MacyÃ¢â¬â¢s. For example, experienced management can teach and lead employees to perform day-to-day operations and to be professional in what they do. Brand awareness is also an important factor since customerÃ¢â¬â¢s judge product and service by its brand image. 2. To this date, MacyÃ¢â¬â¢s is struggling to find a sustainable competitive advantage in the retail industry. Clothing store such as ZARA and H&M have a definite advantage since they attract customers by displaying latest fashionable clothing with affordable price and MacyÃ¢â¬â¢s on the other hand, have not yet able to deliver right messages to buyers. Moreover, MacyÃ¢â¬â¢s consolidation and efforts to become national-wide brand are not unique because most major retailers in the states are now national brands. However, MacyÃ¢â¬â¢s strategy of positioning themselves as Ã¢â¬Å"mid-levelÃ¢â¬ can become a unique competitive advantage in the future because people would believe its merchandise is neither cheap nor expensive. This way people wonÃ¢â¬â¢t judge MacyÃ¢â¬â¢s as a Ã¢â¬Å"cheap storeÃ¢â¬ but store which carries affordable items. Nevertheless, MacyÃ¢â¬â¢s still face a serious threat since fashion clothing retailers such as H&M and Urban outfitters are targeting teenagers with very low prices. One way to improve competitive advantage may be quality. Customers know H&M is a cheap, fashionable store and they also know clothing will wear out if washed couple times. By focusing on quality, people may recognize paying extra money to purchase MacyÃ¢â¬â¢s merchandise is saving money in long- term. 3. Overall, MacyÃ¢â¬â¢s consolidation and repositioning strategy have many advantages since the company converted 15 department stores to MacyÃ¢â¬â¢s brand; Remodelling stores promote a pleasant shopping experience to customers, displaying fashionable clothing to attract trend-followers, and developing private brands to increase profits. As mentioned above, the first strength to this change is the decision to consolidate. By using the same brand name, this will reduce advertising costs, customers will easily recognize the brand, and since all stores carry same products they may have bargaining power over suppliers. Next advantage is locations. Since MacyÃ¢â¬â¢s now have approximately 810 stores in 50 states, customers can visit any MacyÃ¢â¬â¢s stores without inconvenience. Moreover, because all stores carry same products, services, and designs, buyers can visit any stores to buy what they need. Last strength is MacyÃ¢â¬â¢s focus on affordable fashion. People nowadays value fashion so much that they simply wonÃ¢â¬â¢t purchase clothing that is boring and bland. By recognizing these factors, MacyÃ¢â¬â¢s are working with top designers to attract and show buyers their brand is fashionable and also affordable. Despite of these advantages, MacyÃ¢â¬â¢s also have weakness to worry about. Customers are complaining that the price of merchandise increased and they would shop elsewhere. MacyÃ¢â¬â¢s would reduce these complaints by offering coupons or to perform customer relationship program to recognise those who are loyal to the store and give special incentives or discounts. 4. Ã¦ ¤Ã§â ¨Ã¦Ë ·Ã¥ Ã¥ · ²Ã¨ ¢ «Ã¦ ³ ¨Ã¥â Å',Ã¨ ¯ ·Ã¥ ¦Ã¦ ¢Ã¤ ¸â¬Ã¤ ¸ ªDepartment stores are faced with serious threat since industry is declining and competitions are growing rapidly. But MacyÃ¢â¬â¢s have found a bold strategy to compete in a tough market. MacyÃ¢â¬â¢s has a good chance of succeeding in 5 years since the store recognizes the trend and strives to meet customerÃ¢â¬â¢s needs. In order to extremely successful in the future however, MacyÃ¢â¬â¢s need to closely monitor competitors such as Nordstrom, ZARA, and H&M to gather competitor intelligence and to react to fast changing market. Brand awareness is also a crucial factor for success. Brand loyal customers tend to be less price sensitive because they have a strong belief that it is worth paying more money. If MacyÃ¢â¬â¢s can build brand royal customers, they would reduce advertising costs, and have positive brand image. Lastly, pricing its merchandise will be a key point for success in 5 years bec ause price is what makes customers to make a purchase or to find a substitute.