BI Case Study

Macy’s Gets A Leg Up On Competition With Business Intelligence

26 February, 2015

Macy’s Gets A Leg Up On Competition With Business Intelligence

Although Macy’s, an international department store, isn’t exactly the most groundbreaking business, the method it uses to incorporate big data is setting the nearly 200-year-old company above its old-school competition.

By installing analytics software into the company’s database, Macy’s and can analyze tens of millions of terabytes of new information every single day. In addition to regular store transactions, some of the information the company gathers comes from unlikely places such as social media platforms—particularly twitter feeds. This unique information helps Macy’s better understand its customers’ buying behavior and allows it to sharpen its promotions and product in order to capitalize on it.

For Macy’s, big data analytics has become a key competitive advantage that has bolstered thin margins and simplified operations in all departments of the company. With store sales almost immediately increasing by 10 percent, it has proven to be a very profitable tool, and many other retailers have taken notice.

Now, with other big retail chains such as Sears, Wal-Mart and Target taking advantage of the valuable tool, it is essential for companies to find creative ways to apply their data in unique ways. Macy’s has done this by predicting in-store sales based on specific weather patterns as well as dynamically pricing goods as they are deemed “hot or not.”

“The challenge is to refine the use of data analysis,” said Karem Tomak, the vice president of analytics at Macy’s, in an interview with CNBC. “The ultimate trick is marrying outside big data, such as weather reports or social media, to the inside data retailers already collect.”

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