Macy’s In and Field’s Out in Federated Announcement

Discussion
Sep 21, 2005
George Anderson

By George Anderson


Federated Department Stores has a plan and it is heavy on the Macy’s and Bloomingdales and totally
Marshall Field’s free.


Yesterday, the department store operator announced changes that would eliminate about 6,200 jobs with the phase out of divisional operations and corporate headquarters positions from the former May Department Stores Inc. It also announced it would change the banner on all 62 of Marshall Field’s stores to Macy’s and sell off the bridal group business it acquired in the deal with May’s. It has yet to make a decision on what it will do with Lord & Taylor.


Federated said all stores, offices and operations will remain in place through the 2005 holiday selling season and reiterated its pledge that there will be no job cuts until March 1, 2006.


“To better serve our customers in this highly competitive retailing environment, we must concentrate on our best national brands and reduce costs so we can deliver outstanding value to shoppers,” said Terry Lundgren, Federated’s chairman, president and chief executive officer in a released statement. “We believe that continuing to build Macy’s and Bloomingdale’s aggressively across America will accelerate our comp store sales performance and increase profitability, thereby driving shareholder value.


“By announcing these decisions now, we can begin more specific planning for the future. This includes discussing potential career opportunities within Federated for May Company employees and ensuring new merchandise assortments are in place as soon as possible in stores acquired from May. We will begin buying and planning Macy’s assortments this October so goods are in-store during the third quarter of 2006,” he said.


Michael Appel of Quest Turnaround Advisors told The Associated Press, “The moves are a logical extension of Federated’s strategy. Macy’s nameplate is going to take over, and they are streamlining the old divisional operations of the May company and putting them under the Macy’s umbrella.”


Logical or not, many in Chicagoland are not pleased with Federated’s decision to do away with the Marshall Field’s and replace it with the Macy’s banner. In an unofficial poll on the Chicago Tribune Web site, 90.5 percent (as of 7:30 EST) said changing the name would make a difference to them. Nearly 97 percent said the name change would make it less likely they would shop at the store.


Federated’s Lundgren said the decision over the Field’s name was “difficult, challenging and emotional.”


“It’s a hard thing for anyone to accept a big change, but it’s an opportunity for us to move the business forward,” he said.


While the name will change, Mr. Lundgren said the important qualities that made Marshall Field’s what it is will remain the same. “We have complete and total respect for the traditions of Marshall Field’s,” he said. “We’ll protect those traditions. … But we also have a commitment to improve the business.”


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40 Comments on "Macy’s In and Field’s Out in Federated Announcement"


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Neil Thall
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Neil Thall
15 years 5 months ago

As a native Chicagoan, I find this very, very sad. This is yet another example of the homogenization of America. All department stores look the same, with the same product no matter where you go and all malls have the same specialty and department stores (a bit of an exaggeration, but not much). Standardization may be more efficient and it may improve margins, but it also reduces potential customer loyalty. It’s no surprise that unique venues like Whole Foods and Trader Joe’s are doing so well; customers are tired of the same old/same old.

Cheryl Endres
Guest
Cheryl Endres
15 years 5 months ago

Wal-Mart has proven that mass retail works, but the best stores are not mass market. So the questions is: What is the image that Federated is trying to achieve? Chicago doesn’t want to be New York, Minneapolis doesn’t want to be Chicago or New York. I recommend giving each major metro location it’s historical department store name & personality. Find some other way to tie them all together. Maybe Macy’s can have a little beauty boutique in each store.

Daniel Goss
Guest
Daniel Goss
15 years 5 months ago
As a Chicago transplant for 5 years, I’m conflicted on the sensibility of this decision. With the contraction of the department store industry, at such a feverish pace, over the past 15 years, most US cities have lost their signature department stores. Even Marshall Field’s changed the name plate of two of its icon nameplates — Dayton’s and Hudson’s. With all of this said, Marshall Field’s is not just a Chicago institution, it is a Midwest institution. Marshall Field’s is to Chicago what Macy’s is to New York. There are a number of reasons that Field’s has suffered on the sales line over the past several years. A constantly changing marketing message, a product assortment that has been spotty and not targeted with enough mass appeal in the Midwest, as well as C and D locations that are obviously treated like as such. With all of that said, Marshall Field’s is no longer the Marshall Field’s of yesterday. To move forward, I am sad to say, a name change, may be needed as the new… Read more »
Tasha Huebner
Guest
Tasha Huebner
15 years 5 months ago
I’m not sad about this, I’m incensed. Is nothing sacred? Destroying a brand that’s been around for over a hundred years? I can’t help but wonder what MBA bean counters thought this was a good idea – and I have an MBA from Wharton myself. But it’s certainly clear to me that they didn’t factor into this people’s emotions, and as a lifelong Chicagoan, I can safely say that everyone I know is upset and disgusted by this move. Federated doesn’t seem to understand that department stores aren’t all that different – most people pick one over the other because it’s what they’re familiar with, and because of a sense of tradition and nostalgia. Those fond memories go a long way. Just yesterday I was at Old Orchard, and after glancing at the merchandise at Nordstrom and buying nothing, I wandered over to Field’s with no specific purchases in mind, yet wound up buying hundreds of dollars in merchandise. But, I will never darken the door of Macy’s, any Macy’s, or any other store they… Read more »
len Stein
Guest
len Stein
15 years 5 months ago

I believe Federated made a difficult but sound business decision in converting the 62 Marshall Field’s department stores to the Macy’s brand.

To survive as a department store in the face of severe competition from Wal-Mart, Target, and Kohl, who feature low prices, and high-end specialty stores like Nordstrom, Neiman Marcus, and Bergdorf Goodman, Federated has to create one umbrella brand to realize significant efficiencies from centralized buying and a national advertising campaign.

In this fast moving global economy, retailers have to be nimble, smart, and innovative to survive. In the process, an iconic retail brand like Marshall Field’s has outlived its franchise.

Craig Sundstrom
Guest
15 years 5 months ago

“To better serve our customers in this highly competitive retailing environment, we must concentrate on our best national brands and reduce costs so we can deliver outstanding value to shoppers,” said Terry Lundgren, Federated’s chairman, president and chief executive officer in a released statement. “We believe that continuing to build Macy’s and Bloomingdale’s aggressively across America will accelerate our comp store sales performance and increase profitability, thereby driving shareholder value.

Perhaps each of the (“new and improved”) rebranded flagships can sport a boutique that specializes in selling clichés… maybe, say, <> : way to shop…. NOT!

Mark Barnhouse
Guest
Mark Barnhouse
15 years 5 months ago
Fantasy Scenario: Chicagoans need not bemoan the loss too loudly, as Macy’s will have just a few years in which to operate in their fair city. After seeing comp sales in the negative high double digits after the switchover, they will pull out of Illinois altogether. The State Street store will become the largest loft conversion project in Chicago history (with a Harrod’s-like Whole Foods Market on the ground floor, naturally). The Water Tower store will become, in a weird reversion to previous ownership, the most elegant Target location in the country. The suburban stores will be bought by Wal-Mart as it tries to go even more upscale (remember, this is a fantasy) and they’re looking for a way to continue to grow after having built as many US locations as Starbucks and McDonald’s combined. More seriously: I hate the change, and I disagree with Macy’s reasoning (and goodbye, L&T — you too will be history). But despite what they told the Tribune, most Chicagoans will continue to shop there (if they shop in department… Read more »
George Anderson
Guest
George Anderson
15 years 5 months ago

Perhaps the Dominick’s example shows that ultimately, in Chicago and elsewhere, it’s more about what’s in the store than the name hanging outside over the door.

Joseph Peter
Guest
Joseph Peter
15 years 5 months ago

For some reason, I thought I would be the minority in my dismay from changing Marshall Field’s to Macy’s…but its great to see I am not the only one feeling the shock and anger that most of you are feeling. I am a Chicagoan by the way…so I know exactly how importantly the city of Big Shoulders feels about losing its integrity…I am hoping that Lundgren does come to his senses and realize it’s not what we want here in Chicago proper….Change the name in Rockford, South Bend, Minneapolis…but leave it the same in our Chicago area! The news reports have been negative, negative, negative!!!!

Mark Burr
Guest
15 years 5 months ago
When Marshall Field’s became the name that replaced the Michigan tradition of Hudson’s, I may have decried it, the same as being said by those in Chicago. Maybe it is with justification. However, the Hudson’s stores, once Marshall Field’s, actually became better places to shop. Product selection, feel and atmosphere was improved. Most importantly, however, service was improved. If they can become a better place to shop, then I am all for it. However, there was great respect for the Marshall Field’s name as it also came out of the same long tradition and region. I am not so sure that Macy’s carries that same respect or tradition that Midwesterners can easily grasp. It’s all in a name? Not necessarily true. But name does stand for something. I am not so sure that Macy’s stood for the same thing. That’s the difference. And yes, there is some rivalry between New York and Chicago, but I don’t think that is the same issue. I think it has to do with consumer expectations that come with a… Read more »
carl KROOP
Guest
carl KROOP
15 years 5 months ago

Albertsons and Safeway did not change the names of Dominck’s and Jewel because they understand that Chicago is really a very local city. Changing the Field’s name in Chicago to a New York name, Macys, will only hurt. The rest of the country might think that anything New York is good — Chicagoans think just the opposite.

Joseph Peter
Guest
Joseph Peter
15 years 5 months ago

The Chicago Tribune did a poll asking if people would shop at Marshall Field’s if it became Macy’s? 96.9% of people said they would no longer shop there. Did Lundgren interview people from New York in making this decision? You can state all of your business facts and figures on here, but in reality, no one I have talked to here at work, on the train, or in my family will continue shopping at Field’s when it becomes Macy’s…enough is enough! Just read the Chicago newspapers today…disbelief, anger, resentment, annoyance, shock, etc…you name it, Chicago people are ticked off….yeah Mr. Lundgren, that’s a great way to introduce your new store into a new market…upset and tick the customers off!

come on, retail experts here….I dare you to argue with that statement!

I see another flop, similar to the Dominick’s/Safeway debacle happening with Field’s/Macy’s!!!!!!

JOhn Josephitis
Guest
JOhn Josephitis
15 years 5 months ago
This is a simple no brainer. Macy’s = New York & Marshall Field’s = Chicago. Chicago is the “Second City” and there is a real rivalry between Chicagoans and New Yorkers. The City of Big Shoulders definitely does not like to be associated with other cities — especially New York; we are an individually unique, great city. This will turn into another Dominick’s debacle. Dominick’s drew customer’s because of good service and a sense of local pride. I shop at Marshall Field’s because of good service and a strong sense of local pride. Furthermore, I would not buy a “Polo” shirt if it had a “Members Mark” icon on it!!! Marshall Field’s name may go for now but I predict it will shortly return when the customers refuse to shop at New York’s’ Macy’s. When the big shots in New York realize their money is drying up, we will welcome Marshall Field’s name back just as Federated says it may bring back the manufacturing of the “Frango” chocolate line back to Chicago. I wonder why… Read more »
Gene Hoffman
Guest
Gene Hoffman
15 years 5 months ago

Marshall Field’s, Wanamaker, Gimbels, Dayton’s, Hudson’s, etc. — must most of the former great department stores be discarded today to accomplish standardization and to reduce competitive workforces? Federated’s Macy’s will still sell MF’s Frango mints and I suspect we’ll see the iconic Marshall Field’s logo reappear on department stores someday either by Federated or when they’re liberated.

Michael Tesler
Guest
Michael Tesler
15 years 5 months ago

Was Marshall Field’s, or for that matter, Jordan Marsh or Strawbridge or A&S or any of them really that much different (or better) than Macy’s? Please!!! They all sell the same things…Polo, Nautica, Liz Liz Liz, DKNY, Hilfiger, the same cosmetic counters over, and over, and over, etc., etc. We are lamenting the loss of the stores gone bye, the great stores of the 1950’s and 1960’s. We may miss the great old buildings but the interiors have been lacking since the Campeau era. We did not need all these nameplates selling exactly the same stuff, exactly the same way. Are you watching and listening — Harrods and Selfridges for “Our nation turns its lonely department store eyes to you”………… now those are real department stores like the ones we used to have!

J. Peter Deeb
Guest
15 years 5 months ago

As important as the Name is the Merchandising! If that gets centralized, the original Marshall Field’s stores could look nothing like the original over time and Chicago could have another Dominick’s on it’s hands!

Mark Lilien
Guest
15 years 5 months ago

Sometimes great new businesses can be grown from the ashes of older brands. The best example: Abercrombie and Fitch is an ancient brand, although the most recent incarnation certainly looks nothing like the original. But it’s much harder to re-create a brand than simply recycle the real estate. Macy’s goal is to focus on 2 national department stores: Macy’s for the “upper middle” and Bloomingdale’s for the “high end.” My assumption is that L+T will be divided up between the 2. Macy’s management doesn’t want to spend the time on distractions like the bridal business or growing local brands like MF. Years ago, Macy’s created Aeropostale, couldn’t make it very profitable, and spun it off. After the spin-off, it did fine. If Macy’s licensed the MF name to someone else, it might do fine, but that would enable further competition in the department store arena. It’s a shame that a brand name with great equity has an owner that can’t be bothered.

Ben Ball
Guest
15 years 5 months ago

This morning’s Trib featured comments from locals on the Field’s name change on the editorial page. Two of the best:

“Mayor Daley should bulldoze the State Street store (the icon) in the middle of the night to save it from the insult.” This reference is to da mare’s foray in bulldozing Meig’s Field, a local private airport he didn’t like having in the city, in the name of “Homeland Security.”

“It doesn’t matter what they do with the name — the service left town long ago…”

Sad day. But in the long run the only thing that will matter is whether “Macy’s” turns out to be an improved shopping experience. Odds are….no.

Brian Kelly
Guest
15 years 5 months ago

C’mon, retail ain’t for sissies…

MF has many fingerprints on it. It’s been a long time since it was about, “give the lady what she wants.” Today’s mall based stores are nothing special and haven’t been for a long time. While loyalty remains in Chicago, Federated’s challenge is to offer a compelling selling model. The name won’t matter much.

Nordstrom had little to no loyalty in Chicago before it came in during DH multiple personality ownership (Dayton’s, Hudson’s and MF). It has succeeded due to a superior model for the Chicago carriage trade.

Federated switched out the Atlanta market from Rich’s to Macy’s. I imagine they are betting the performance will resemble the same “j-curve.”

The name game only goes so far. It is what’s inside that counts.

Maura Junius
Guest
Maura Junius
15 years 5 months ago

As a Chicagoan, I think Federated has made a big mistake changing the name of Marshall Field’s to Macy’s. While Marshall Field’s has struggled under various managements and philosophies, the name has sentimental meaning and traditional prestige here. Macy’s does not. I, for one, will not be visiting the Macy stores. I will be checking with my mother, who is a masterful, skilled and astute Chicago shopper, to see how the older generation is responding and if this will impact her shopping patterns.