Department Store Demise

January 30, 2017

Department stores up and down the price spectrum are under intense pressure to show they can still be relevant and central to the shopping experience. Apparel chains have been talking for over two years now about how they plan to address fast fashion and compete with Internet shopping. When Macy’s announced that its long time CEO would be stepping down, her successor reassured pessimists that the veteran department store would stay relevant with fresh ideas at a time when people are buying their clothes and beauty products elsewhere, mostly online or boutiques. But the fresh ideas do not seem to be working; Macy’s has said it’s planning to close 100 stores (15% of its total) this year and possibly more to follow. Sears has already shown how a retailer can hang on for a long time despite a decade long decline in sales. But how much longer can they hold on with other department stores facing closures? As a marketer (and shopper), it would be ideal if the interaction of department stores met with the convenience of online shopping. More specifically, department stores need to vamp up the shopper’s experience, making it more of an exotic destination versus a floor of countertops and sales people. Online shopping needs to figure out a way to be more personal and communicate with the customer. If (and hopefully when) this happens, maybe the abrupt closings of major department stores wouldn’t be happening and the retail world could enjoy both ways to shop.

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