OPERATIONS

Dick’s Sporting Goods obtains early insight into merchandise

BY Dan Berthiaume

Dick’s Sporting Goods is applying advanced analytics to better understand what products it should sell, and at what cost.

Dick’s is partnering with predictive analytics solutions provider First Insight, to help make faster and more accurate decisions in the areas of product design, merchandise buying and pricing decisions on thousands of goods and designs.

Through online consumer engagements, First Insight enables Dick’s to gather real-time consumer preference and pricing data on candidate products months before they are launched in the market. The data is filtered through First Insight's predictive analytic solution to determine which products present the greatest sales and gross margin opportunity.

Thus Dick’s is empowering designers, merchants, buyers and planners to gain real-time consumer predictive analytics throughout the merchandising organization and the product development lifecycle.

"First Insight is now a critical element in our product decision-making process," said Lee Belitsky, executive VP, planning, replenishment, allocations, and product development, Dick’s Sporting Goods. "By using First Insight to test items — both branded and private label — before making our buys, we are increasing speed to market of the right items. After evaluating the solution for an extended period, we have projected the solution will deliver a strong return on investment."

By determining what features make consumers most likely to buy a product, and at what price, as early as in the design process, Dick’s can greatly increase sales and turn while decreasing the need for markdowns or liquidation. The availability of predictive analytics, combined with the unprecedented ease of mass online consumer engagement, is a potent mixture that can make merchandising much more accurate and profitable.

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Guitar Center creates merchandising harmony

BY Dan Berthiaume

Operating multiple brands and channels, Guitar Center has struggled in recent years with merchandising challenges such as omnichannel retailing, branding and selling a mix of new and used products.

These merchandise planning struggles have hampered productivity, as well as resulted in siloed planning and sub-optimal decisions. However, by implementing the multi-tenant, cloud-based mPower merchandise planning system from o9 Solutions, Westlake Village, California-based, 270-store Guitar Center has been able to upgrade its merchandising processes in time for the 2016 planning cycle.

Among the capabilities Guitar Center has gained are the ability to plan across multiple dimensions including brands, channels, categories, inventory segments and vendors. The user interface is also more flexible than the retailer’s previous merchandise planning interface.

“As we went down the road to select a partner for our merchandising solution needs, we had a number of critical considerations,” said Flynn Chernos, senior VP, planning at Guitar Center. “First, we wanted to select a partner who could not only fulfill our current needs, but also offer a complete solution for future needs. Second, user adoption was critical to our success. Third, speed and agility were key to achieving our business goals. We are excited by our initial success and the foundation it creates for a strong partnership in future.”

Survival in the 21 century means a retailer’s back end must operate as seamlessly and connectedly as its front end. By aligning its merchandise planning processes behind the scenes, Guitar Center is ensuring customers will have timely access to the products they search, browse and shop for across channels.

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Kroger wishes retiring Fred Meyer president well, names successor

BY Michael Johnsen

Photo: Jeff Burt

Kroger announced Tuesday the retirement of Fred Meyer president Lynn Gust effective Jan. 31, and the promotion of Jeff Burt to succeed him. Burt currently serves as president of Kroger's Central division.

Fred Meyer Stores, based in Portland, Ore., offers one-stop shopping at 132 multi-department stores in Alaska, Idaho, Oregon and Washington.

"Throughout his distinguished career, Lynn as always led by empowering, encouraging and supporting others," stated Rodney McMullen, Kroger chairman and CEO. "Lynn is widely respected throughout our company and industry for his passion for people, the food business and the communities we serve. The entire Kroger family wishes Lynn and his family all the best in retirement."

Gust started his career with Kroger in 1970 as a parcel clerk at Fred Meyer's Fourth Plain store in Vancouver, Wash. In 1972, he entered Fred Meyer's food management program and advanced to serve in a variety of leadership roles in the division, including food department manager, training coordinator, grocery buyer and director of grocery sales and merchandising. He also attended the Cornell Food Executive Program in 1994. After serving as group VP for the food group, he was named senior VP of the store operations group in 2003. Gust was named executive VP of corporate merchandising and advertising in 2006, followed by VP operations in 2011. He was promoted to president of Fred Meyer in 2012.

Under his leadership, Fred Meyer reached $10 billion in annual sales for the first time. Also under his leadership, Fred Meyer was recognized twice as one of Oregon's "Best Places to Work" by the Portland Business Journal, and twice as one of Oregon's "Healthiest Places to Work" by The Oregonian.

Following his retirement, Gust and his wife, Julie, will continue to be active in many community organizations in Portland and beyond, including serving on the board of trustees for Randall Children's Hospital.

Burt, who will succeed Gust, is currently president of Kroger's Central Division, which operates food stores primarily in Indiana and Illinois. His successor will be named at a later date.

"Jeff is a strong, dynamic leader who brings out the best in our associates," McMullen said. "His enthusiasm for serving our customers combined with both broad and deep experience in our business – including in the Pacific Northwest – will serve our Fred Meyer team well. We are grateful he agreed to take on this important role."

Burt began his career with Kroger in 1986 as a management trainee. He has held a variety of leadership positions with the company in Cincinnati, Florida, Indianapolis and Seattle, including store manager, produce merchandiser and VP merchandising and operations. In 2004, he was named corporate VP of deli/bakery merchandising and procurement, before being promoted to group VP of perishables merchandising and procurement in 2010. He has served as president of Kroger's Central division since 2013.

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