Macy’s draws on Google Cloud data management, analytics for warehouse optimization

Dive Brief:

  • Macy’s is using Google Cloud data management and analytics offerings to help power its new, in-house developed warehouse management software, Google Cloud announced Wednesday. The software launch coincides with Macy’s plans to open a 675,000 square-foot distribution facility in Columbus, Ohio this fall to support Backstage, its line of off-price stores. 

  • The retailer plans to initially roll out the warehouse management system to more than 200 Backstage stores, according to the announcement. It later plans to embed it in distribution centers for Macy’s and Bloomingdale’s department stores and online direct-to-consumer orders. 

  • Macy’s will rely on Google Cloud’s scalability for supply chain optimization to ensure merchandise efficiently ships from the center to stores, meeting demand driven during back to school or the holidays.

Dive Insight:

Macy’s work with Google Cloud dates back to about 2015, Pravin Pillai, Global Head of Retail Industry Solutions, told CIO Dive. But the arrival of Naveen Krishna, Macy’s chief technology officer, last June has accelerated the retailer’s cloud adoption. 

Macy’s put Krishna in charge of the company’s end-to-end technology strategy, including store, e-commerce and internal technologies. He previously served as the VP of IT at The Home Depot, a fellow Google Cloud customer. 

Macy’s is working to move more workloads into the cloud, centralizing some of their data platforms, Pillai said. 

Cloud migrations require a cultural transformation. Adoption begins with experimentation, often starting small with website optimization before migrating backend systems. Supply chains are particularly ripe for cloud adoption, given the intricate pieces tying disparate parts of the business together. 

Retailers are coming to the realization that to transform the business, they have to look holistically across the organization, according to Pillai. That requires making technology a core part of the business strategy, from supply chain to digital commerce to customer acquisition. 

Once the data is in play, retailers can apply analytics and machine learning to add in predictive elements, he said. 

In the e-commerce era, traditional retail sales have lagged and bankruptcies have caused a rash of store closures. Department stores have to rethink the way they do business

Macy’s has a lot to optimize. This week, it lowered its profit outlook after Q2 sales fell to $5.55 billion from $5.57 billion in Q2 of last year, Retail Dive reports

To help with efficiency retailers are turning to technology optimization and leading cloud providers are eager to serve. Fearing competition from Amazon, retailers are gravitating to Microsoft Azure or Google Cloud.

Google has championed its retail prowess, appealing to business with industry-specific solutions and highlighting its “robust” partner ecosystem, supporting customers including Kohls, Lush and The Home Depot.