Is data eliminating the need for chief merchants at retail?

By Tom Ryan

SEPTEMBER 29, 2015

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With software increasingly driving allocation decisions, some recent industry coverage explores how the chief merchant role is evolving.

Some articles discuss how areas such as marketing and supply chain are being incorporated into chief merchant responsibilities in today's complex omnichannel world. The traditional role of spotting trends has become less important with algorithms taking over, according to the stories.

The stories reflect trends seen in a number of unconventional moves around the role of chief merchant carried out by major retailers:

• Kohl's, after a long search, recently decided to hand over merchandising responsibilities to its chief marketing officer;
• Target earlier this year split its chief merchandising and supply-chain officer roles;
• Last November, Walmart decided not to replace its chief merchant and instead has its VPs over key categories reporting directly to the retailer's U.S. chief.

Last week, J.C. Penney promoted John Tighe, who had been overseeing buys for men's, children's, footwear, handbags and intimate apparel, to chief merchant. But on its second-quarter conference call, Marvin Ellison, JCP's president and CEO designee, said the chain has to get better at the "science of retailing" across allocation, replenishment and presentation.

Photo: RetailWire

"The toughest thing to do is get the right product, right style, right quality, and to get the customer to be committed to it," he said.

According to The Wall Street Journal, the shift in emphasis to analytics in merchandising is due to sophisticated software that enables merchants to gain ever-faster reads on sell-throughs inside their own stores as well as at competitors. Younger generations are also seen as much more apt to tap Big Data in guiding buys. The article also points to how consolidation has created chains "so big that buying by instinct isn't an option any more."

Omnichannel retailing is also complicating inventory management and other standard retail processes.

Still, the creative side of merchandising earned some praise. Waiting for hard data may slow a merchant down in reacting to a trend and overly relying on data can lead to a sea of sameness across stores. At the same time, extrapolating data adeptly can be considered an art.

"Everybody has data," Brett Wickard, founder of "lean retail" software company FieldStack, told Retail Dive. "Using it is the hard part."