The coronavirus pandemic has worsened an existential crisis that deepened over the last 10 years.
The heyday is over. The question for department stores now is whether there will be a new day.
Certainly, the pandemic has made that already sticky question all the more difficult to answer. But many retailers in the space had been trying. Early this year, for example, Macy’s inched toward rehabilitation as it outlined plans to get away from so many enclosed malls, close more than 100 stores and improve its private labels. Late last year, Nordstrom made strides executing its vision for a 21st century department store when it put the finishing touches on its retail ecosystem in New York City. Now, forced to institute layoffs and take on new debt, they and many others are just hoping to hang on through the holidays.
Yet the pandemic, as devastating as it’s been to people’s lives and livelihoods, didn’t provoke the current existential crisis for these retailers. That came earlier, through consolidation and over-expansion — especially at Macy’s, which broke several cities’ hearts when it took over and renamed their local department stores as with Chicago’s beloved Marshall Field’s in the Loop 14 years ago. E-commerce is a factor, but by now, department stores are e-commerce players too. More devastating have been the declines — possibly all related — of the middle class, the mall and the need to dress up for work or occasions.
The Great Recession was technically over by 2010, but retail has never been the same since. And the last 10 years have been especially brutal to department stores. The following timeline provides a few snapshots of how things have gone.
Department stores in the last decade2010
Things are looking up for most department stores as they recoup from the Great Recession.
Nordstrom looks back at 2010 as a “terrific year that exceeded our expectations,” noting that it opened three full-line stores and 17 off-price Racks in the period, topping 200 locations for the first time.
Sears is a notable exception, with revenue, profit and store comps all down for the year. Still, the company signs a lease in a historic downtown San Francisco building to house a newly energized apparel team.
Macy’s boasts that the impact of nearly doubling in size through its [ … ]