Reecently, MACY’s (Federated Department Stores) has announced its intention to acquire the MAY Co. chain (including FILENE’s Dept. stores. This seems to me to be evidence that the decline of the department store is accelerating-as specialty retailers (like the GAP, A&F, Banana Republic) take more and more of their business away, the low end of their market gets eaten up by TARGET, WALMART, etc.
So, is this the final chapter for the classical department store? I would imagine that having high-overhead, in-town “flagship” stores must be a heavy expense for these chains to carry-and merging will make them at least temporarily, more effcient.
I’d say the end for department stores started on the 1980’s-and the last chapters are being written now-in ten years, Macy’s may no longer exist.
I don’t believe they have to be in the shape they’re in, Ralph. However, the people I know who do shop there complain of the lack of knowlege of the sales staff and the “marketing” based positioning of items on the floor, where you have to wander through a thicket of items you don’t want to get to an item you do.
In short, they probably will all but die, but it’s as much from following a bad business plan, resisting change, and not paying attention to competition, as much as being outmoded.
As long as the Macy’s Thanksgiving Parade continues, I won’t miss the actual stores.
If one chain of department stores (Macy’s) is about to acquire another (May’s), why does that portend the decline of the department-store industry?
Seconded. I see no decline of the department store concept per se, but rather the localization of brands as the retailers become increasingly globalized. In NE, we’ve gone through this already a couple times, with the loss names like Lechmere and Jordan Marsh. The malls haven’t shrunken, nor their numbers decreased.
Isn’t Wal-Mart just as much a department store as Sears or Penny’s?
Marc
Right - it isn’t the end of department stores. Walmart is just doing great - thank you. It’s a customer move away from brand and to better prices and a new business model IMHO.
So with the rich getting much much richer, shouldn’t high end department stores be flourishing?
In Tampa there’s a high-end mall called the International Plaza, which has a Dillard’s and a Neiman-Marcus – and they certainly seem to be flourishing.
Well it’s been 19 years and Macy’s still exists. But it keeps closing more and more stores and just announced it’s killing 1/3 of its existing stores:
So from over 1,000 stores in 2005 when the OP’s post was written to 350 within a year.
Department stores as well as malls in general are doing just fine in the built up regions of European cities. Places where foot traffic is a thing anyway.
In our modern era no one is getting in a car and driving to the middle of an asphalt field to then walk into a store to search for an item when in the comfort of their own house and sitting on couch they could enter a word search and then hit within minutes and it’ll arrive within the week.
Automobiles and our city planning are to blame.
I’ve been to Macy’s and Nordstrom has not a handful of times in the last ten years. Twenty years ago I’d have gone about once a month. And the last two visits to them I bought nothing at all. They either did not have any shoes in my size in any reasonable style (Nordstrom) or there was no one available to even look to see if they had my size (Macy’s)
Online isn’t a great solution. It took me returning at least 20 pairs before I had a pair each of black and brown dress shoes that fit me and didn’t look incredibly cheaply made.
What kills department stores for me is not online shopping but lack of consumables. Sure, occasionally in the same mall there will be a grocery store, but not often, so I’d rather get all my shopping done in one place. I’d rather that place be a mall because then I’d also be able to eat at the food court, but here we are.
I grew up in and around Philadelphia, a city that was once a haven for fine department stores. The most famous ones were the Big Six: John Wanamaker, Strawbridge & Clothier (“The Store That Does Things Right”), Lit Brothers, Gimbels (“Nobody, But Nobody, Undersells Gimbels”), N. Snellenburg & Co.(catering to the Jewish community), and Frank & Seder (with a rooftop garden). They were all located on Market Street, the main shopping district in downtown Philadelphia.
John Wanamaker was the first and most influential of the Big Six, founded by John Wanamaker in 1861. It was known for its innovations, such as the first in-store restaurant, the first Christmas tree, and the largest pipe organ in the world. It also hosted many cultural events, such as concerts, lectures, and fashion shows
These flagship department stores were more than just places to shop. They were destinations to experience. Folks dressed up to visit them from near and far. Children dreamed of seeing their holiday displays. Although I was born after the department store heydays (my parents and grandparents witnessed their glory days), I still feel nostalgic for them. They were a part of Philadelphia’s history and culture.
But, times changed and people’s tastes changed. They wanted cheaper and faster options. They preferred shopping malls and discount stores. They lost interest in the old-fashioned charm and service of the Big Six. One by one, they closed down or were taken over by other chains. The last to go was Wanamaker’s (which became Macy’s).
Now, we have wall-to-wall Walmarts and online shopping. They may be convenient and economical, but they lack the magic and the memories of the Big Six.
European department stores are like American ones used to be, with a wide range of products under one roof. Today American stores are clothes, bedding, and kitchen equipment, nothing else. And not the slightest hint of luxury.
At least that was the situation when I was in Berlin in 2015 or so. Maybe it is worse now.
They’re also doing fine in Asia and parts of the Middle East. In recent years I’ve been to Singapore, Bangkok, and Dubai. Malls, and the associated department stores, are absolutely thriving in those places.
And then there’s Tokyo, where department stores are so massive they build their own commuter rail lines.
I think medium department stores are. They can’t compete with online and big box stores in the hinterlands. But big cities at least offer a chance of decent foot traffic. And places like TJ Maxx, Marshall’s and Winners (in Canada) seem to be doing well at the expense of pricier places.
Having worked in a grand old department store in the 1980s, I can testify that they were really expensive places to keep operating. Think about having fine jewelry, furs, major appliances, watch repairs, and a bargain basement under one roof. There were multiple divisions competing for resources, and the ladies who came to the Tea Room for lunch were scandalized by what they saw in Lingerie and Sleepwear. Trying to manage inventory in something like Living Room Furniture (where you might turn over the stock once a year) while using the same system for Junior Sportswear (where a blouse that hadn’t sold in six weeks was put on clearance) tugged cash flow management in different directions, and trying to tailor the suburban stores to their local shoppers was frustrating to someone who saw a particular item in one store but not in another.
People in retail talk about how Eddie Lampert destroyed Sears. Frankly, I’m surprised it lasted long enough for Lampert to get his hands on it.
I think they are are kind of dinosaurs - but i think it’s because they fall in between two other models that Americans seem to prefer. You’ve got the stores like Target , Walmart , Sam’s Club etc that sell a wide variety of items including at least some food , possibly even enough to be a supermarket that are set up supermarket style in that there is one central location with multiple checkout lines. Then there are stores that sell only shoes or only housewares or clothes/bedding/housewares that have multiple registers all in the same area but not supermarket style. The old-fashioned department stores that sold clothes and furniture and toys and small and large appliances and tools (but not groceries) , that had a register in the ladies department and a separate one in the toy department - no one seems to want those anymore.