US department store chain Macy’s is planning to develop an internal testing capability that will enable it to use data analytics in a similar way to online giant Amazon.
The retailer has already invested large amounts in improving its data analytics tools, working with analytics provider Sas, and on hiring enough staff to build a significant in-house data capability. Kerem Tomak, vice-president of data analytics at Macys.com, says the next step is to start to use the intelligence the data produces.
He said: “We want to build an Amazon-like testing environment, but a testing culture is not something people understand right away. We are educating others of the power of testing.”
A testing environment would allow Macy’s to run high numbers of small-scale trials and use the huge amount of data it collects to get insight into how customers are interacting with the brand. The data-driven testing environment, and its trial-and-error approach, is given credit for a large part of Amazon’s success over the past decade.
One of the first things Tomak said he wants to do is learn exactly what combination of online and offline marketing tactics work best.
Tomak said: “Doing it right and tying in offline marketing and online marketing could be a game changer. I’m just scratching the surface at the moment.”
He added that getting the analytics capabilities at Macys.com to a “world-class” standard had taken 18 months to two years, and that it would take three to four to launch the testing environment. This year, Macy’s will be focusing on personalised recommendations, which it has developed its own algorithms for – most retailers trust this to suppliers.