Bargain hunters will flock to Macy’s in downtown Missoula on Sunday, looking to find hugely discounted prices on the first day of the department store’s 60-day liquidation sale.
Ironically, they will likely help the store reach record sales as it prepares to leave town; but more to the point, the sales, which offer quality items at fair or bargain prices, is exactly what customers have always wanted.
“People just don’t want to pay for the extra luxuries and services added into the price of the items sold at the old-fashioned department stores,” said Jan Whitaker, a social historian who writes about the history of department stores and who wrote the book “How the American Department Store Fashioned the Middle Class.”
National experts who follow retail trends applaud Missoula for having a downtown vibrant enough to keep a stand-alone department store for more than a century, but say even Missoula couldn’t avoid the inevitable.
“The thing that strikes me about Macy’s decision is that it is occurring now,” Whitaker said in a telephone interview from her Massachusetts home. “The closing of downtown department stores is something that really started back in the 1970s and 1980s, and it seems in 2010, Missoula has had a reprieve for a long, long time.”
Not only are these kinds of department stores quickly becoming part of America’s retail past, so too is the notion of a “downtown business anchor,” said Bill Ryan, a downtown revitalization specialist with the Center for Community & Economic Development in Wisconsin.
“The anchor department store is really something of the past and the new anchor is a number of various businesses that work together to create critical mass,” he said. “Vibrant downtowns today are ones that have focused on a mixture of uses and these new anchors have replaced the one big store and are the reason for bringing people into downtown.”
Over the past decade, consumer spending habits changed significantly, and this greatly influenced the decline of department stores, according to a 2009 national shopping study conducted by Cavallino Capital LLC, a private California consulting firm.
Consumers’ shift to big box stores is directly related to department store management not following “customers’ rules:” everyday fair pricing, having desirable merchandise in stock, and easy return policies, said John Rittenhouse, Cavallino chairman.
“Shopping at stores that carry overpriced branded merchandise, use high-low pricing, coupons, and loyalty programs have limited appeal, according to consumers interviewed in the study,” he told the Retailer Daily, a trade publication.
When Macy’s corporate leaders announced the Missoula store’s closure last week, they said, by way of explanation, the store was an “underperforming location.”
Yet Macy’s corporate President Terry Lundgren hinted at the information revealed by the shopping study.
“The decision to close stores is difficult,” he said, “and it often occurs when the market changes, new competing shopping centers are opened nearby to existing older ones, or when customers change shopping habits.”
While Missoula mourns the loss of its downtown business anchor – and the store’s 55 jobs – it should also celebrate the unusual fact that the city had a downtown department store for 145 years.
Such a fact should be a point of pride, said Whitaker, who has an entire Web Site dedicated to the history of department stores (www.departmentstorehistory.net).
This particular venue for shopping reached its hey-day in the 1920s and remained vibrant through the 1950s, providing among many things, community social centers, Whitaker said.
In fact, the department store was often a city unto itself, where shoppers – mostly women – would spend entire days, Whitaker said.
Aside from the wide variety of shopping, department stores offered a smorgasbord of extra amenities: a lounge area for reading and socializing, beauty salons, bookstores, restaurants and bulletin boards so women could post messages for their friends and arrange rendezvous times.
It was the all-service stop.
“At the time, department stores stood for style for the masses,” Whitaker said. “They really belonged to this era where a lot of working-class people were ascending to the middle class and the department store gave you an initiation into that lifestyle – what it might look like, how to set the table, what china to use for a party, what bedsheets and furniture to fill your home with.
“Department stores demonstrated those things,” she said.
After World War II, suburbs began growing, women’s careers took off and department stores began to lose customers to the growing number of speciality stores, where shoppers looking for one thing – like shoes – could make a quick stop and purchase.
“Times have changed,” Whitaker said, “and it has taken a whole century for department stores to fall out of fashion.”
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In this evolving retail landscape, Missoula may be worried about the future of its downtown, but it has a lot of reason for hope, said Robert Spector, a Seattle-based business writer who has written for the Wall Street Journal and authored numerous books, including the recently published “THE MOM & POP STORE: How the Unsung Heroes of the American Economy are Surviving and Thriving.”
“We are in the golden age of mom and pop stores because the big chains are closing and putting the brakes on expansion and people are beginning to see opportunity on a local level,” Spector said. “Our faith in government and in our banks has been shattered, and ultimately what we have left is our neighbors and friends: the people we see every day and those are people we want to do business with.”
“I think the entrepreneurial spirit is out there and it’s growing,” he said. “With so many people laid off, there are a lot of people thinking about starting a business, who think, ‘One of these days I’m going to start a business.’ Well one of these days has arrived.”
During the Internet boom in the early 1990s, Spector wrote extensively about the rise of the Internet and how it would affect consumer shopping. Back then, there was great speculation and concern that shopping at home on the Internet would be the end of traditional stores.
“That was so stupid,” Spector said. “Stores aren’t going away, because we all gravitate the marketplace.
“We want to know what’s going on, we want to talk sports and politics, and find out who got married and who died.
“I don’t care if you have a social network and are on Facebook and Twitter, people still want to see each other part of the time, face to face, because we are social instruments.”
That said, Spector believes the timing is particularly ripe for the renaissance of locally owned and operated stores.
“The whole idea is built around the notion of and for community,” he said. “And there are all sorts of residual benefits from have locally owned businesses that goes beyond pure economics.”
Downtown Missoula won’t likely get another big department store retailer, because it already is home to the nation’s few remaining vital department stores like JCPenney, Dillard’s and Sears in the Southgate Mall, Spector said.
Yet the Macy’s building is historic, has character and space, and therefore has great potential to house several locally owned businesses.
Sort of a downtown urban mini-mall, Spector said.
“Very exciting things could happen there, they’ve happened in other communities with similar buildings,” he said. “It’s just a matter of Missoula unleashing its creativity to find a solution.”
Montana is in fact, the national leader in terms of community owned department stores and a national leader for entrepreneurship, according to Jeff Milchen of the Bozeman-based American Independent Business Alliance.
Like Spector and Wisconsin’s Bill Ryan, the organization is seeing more and more locally owned businesses across the country.
“We are seeing a turning of the tide and a growing national interest in returning to more personal relationships and smaller-scale locally owned businesses,” Milchen said. “The localization movement is really gaining steam everywhere in the country right now.
“Folks are recognizing that their community doesn’t have to be dependent on corporate chains for what they want and need, that folks can do it for themselves.”
Some communities have built an entire downtown economy around a niche market, creating critical mass around a theme, Ryan said.
One small community in Texas transformed itself into a shopping destination for antiques, an upstate New York town has become an women’s apparel hub, and a small Vermont town has become a sporting goods mecca.
“The answer for Missoula is going to be looking for something other than a department store to fill the void left by Macy’s,” Ryan said. “Missoula has a lot of things that make it special – a lot of things that bring families and college students into the downtown.
“It needs to hold on to what makes it special and to build on those strengths.”
Reach reporter Betsy Cohen at (406) 523-5253 or at email@example.com.