Thursday, January 26, 2017

How Macy’s Dismantled Everything Once Right about Department Stores

Image result for Filene's Department storeIt was February 28, 2005. The day Terry Lundgren, CEO of Federated Department Stores, announced one of the largest deals in retail history: The merger of 491 May Department Stores with 450 locations operated by Federated. You could sum up the deal’s promise, as pitched to investors on Wall Street, with one word: Big. Lundgren wanted scale—economies of scale, efficiencies, and synergies. Get big enough, and the competition couldn’t touch you.

The $11 billion deal would, in fact, create the largest department store brand in US history. At last, there would be one unified “national branding message,” and one singular go-to-market strategy at Federated. No more unique, locally-based brands merely popular in specific metro markets, yet lacking in national recognition. . . . more

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