Up to about 2o years ago department stores dominated urban retailing and were drawing from 100's of miles away. In each market there was one major and two to 4 additional stores within the trading area. Each store has a distinct look and very wide regional
reputation and lore of attraction. Reference the impact of.... * Rich's in Atlanta * Filene's in Boston
* G. Fox in Hartford, conn. * Macy's in N.Y. * Bloomingdales in N.Y. * John Wanamaker in Philadelphia * Marshall Field in Chicago * Hudson's in Detroit Each store had it's own look, it's own roster of house brands and it's own charge card. THEN RETAILING changed.... * Visa and Mastercard elimnated the domination of a retailers credit plan on any market. * The growth of name brands invited the consumer to compare and the discounter started. * The designer mass marketing of fashion lines was once limited to one major store per city. i.e. Polo Raplh Lauren would only be available in one
retailer in a particular market. * the vendors got greedy and sold to more accounts.
NOW take the name off of any major department store, and
walking inside you really can not tell one from the other. It used to be fun to visit another market and visit another store...now it is oh hum, BORING!!!! heck, there are JC Penney store that looking exactly May company stores or Stern's!!!!
The age today is category stores which have expanded on what the department stores used to do so well. * Crate and Barrel with housewares and increasing growth into the furniture category. * The Limited chain which has gone after every segment of the RTW and soft goods market...even into toiletries with
its Bath and Body works. * Linens and Things, Bed, Bath and Beyond, and others which took an enormous chuck away from the deparment store
The big change came with the malls....
Once downtown stores were malls in themselves...
think about it...everything right down to retaurants... including in the big cities gourmet groceries, fabrics, interior decorating deparments with a very wide following (Dayton's, Bloomingdale's, Macy's San Francisco best example this)
All this is gone....for now the malls have these products with varied retailers... now think about this....
still under ONE roof and with ONE credit card
(well maybe four of five) but you get my drift.
I feel that that the prospect for growth is for the major retailers such as Federated or May is to buy the major players in the specially fields...
Federated should buy Limited or Crate and Barrel for
In the not too distant future it would not suprise me if... Wal Mart and Home Depot merged. Sears, Crate and Barrel, Haverty's furniture, and Best Buy were all one. J.C. Penney were to buy Circuit City. K Mart bought Linens and Things. Dillard's, Kohl's, and Belk's merged.
Banks all offer the same services as the next, mergers are a natural in this scenario. I'm not sure if retailers can benifit by merging. The reduction in purchacing expenses will be realized and that's it The moves would probably be towards companies aquiring their competition and building their market penitration in the same move.
The move dept stores must make is a to carry less catagories and go deeper in the ones they commit to. This way they can compete with their specialty store competitors. The one area they will have a problem with is that consumers are stayin away from the malls. I think people feel they see all the same items at all the different stores so why go to the malls