Macy’s Making Space for Groceries
Macy’s is in the process of working out a deal to bring a 20,000 square-foot grocery store to the basement of its State Street flagship location in Chicago sometime early next year.
Macy’s, which has faced a shopper revolt over its decision to drop the Marshall Field’s banner, has come to the publicly-stated conclusion that it has done all it can to address the issues of the disaffected and has to move on to bringing in a new group of customers. Bringing in an upscale grocery store to the location would be one way to attract shoppers.
Frank Guzzetta, the former president of Marshall Field’s and current chairman and CEO of Macy’s North, would not discuss potential candidates but did tell the Chicago Tribune, “I would like it to be organic.”
According to the Trib report, Macy’s had discussions with Supervalu’s Sunflower Market division but nothing developed from those conversations. Grocers considered possible State Street tenants include Whole Foods, Trader Joe’s and Fox & Obel.
Macy’s is not the only Chicago department store looking at possibly bringing in an upscale grocery operator to the Loop. Carson Pirie Scott has also been rumored to be looking at a grocery partner.
Bill Bishop, chairman of Willard Bishop LLC and member of the RetailWire BrainTrust, said he thought it unlikely that the area could support two grocery stores.
“That could be a problem,” Mr. Bishop told the Trib. “It will be interesting to see who gets the first one.”
While the speculation about a grocery partner continues, Macy’s is taking other steps to attract shoppers that don’t hold the Marshall Field’s grudge. The store has opened a wine bar in the Walnut Room and added an FAO Schwarz toy store-within-the-store as well as putting greater emphasis on exclusive brands with celebrities and designers including Martha Stewart, Tommy Hilfiger and others.
“There are a lot of people who just can’t get over the Marshall Field’s name change,” Mr. Guzzetta told The Associated Press. “Those people, no matter how hard we worked at it, have continued to be detractors.”
Discussion Questions: What are your thoughts on the potential benefits/drawbacks to grocery stores in department stores? Does it make more sense to lease space to an existing grocer or for a department store to operate its own branded grocery? Will adding a grocer such as Trader Joe’s or Whole Foods to the State Street location be effective in helping Macy’s regain lost sales by bringing in new customers?
This is a clever move for Macy’s and it is a huge step in differentiating itself from the competition. Connecting with a high-end grocer is also a good move in keeping it in the higher end. Contracting it out is the best relationship for Macy’s as if it doesn’t work out, there is an easy exit. Plus, Whole Foods and Trader Joe’s are established brands which will take some of the growing pains out of marketing. I love seeing this type of cross selling and I hope it works out for them.
I wanted to respond to those that claim MF was in decline before it was changed to Macy’s. I’m not an eloquent writer so I borrowed a piece written by Brad (11/5/07) from fieldsfanschicago.org:
“Regarding Macy’s claim that the hope to end years of declining sales at Marshall Field’s. This is not simply misleading, it is patently untrue.
Prior to 2003, the entire department store sector experienced declining sales, yet Field’s remained profitable with average sales per store higher than Macy’s or Bloomingdales.
In the years immediately prior to Macy’s takeover, Marshall Field’s was profitable and sales were not declining. In 2003, Field’s posted profits of $106 Million and in the first quarter of 2004 revenues began to increase by 6.1%. This was the beginning of Field’s turnaround….”
Some people may not be aware how much the Chicago loop downtown area is booming these days with permanent residents. There are new campus dormitories and expensive lofts, condos and apartments being created from former commercial office space and industrial space. This population eats, and can use some more places to buy groceries. But Macy’s? Macy’s spent big bucks to buy Marshall Field’s, the crown jewel department store in America with THE finest historic retail space in America on State Street, only to turn it into a grocery store? Words fail. As some other commentators have suggested, one won’t be seeing too many suburban commuters rushing to Macy’s on their lunch hour to buy salami and canned peaches and carry them home on the train.
A holiday Monday, and already 16 comments…this story still has legs, and hearts, as you can tell by the postings!
If it were any other company other than Macy’s, I would say that the grocery and prepared foods idea would have some traction at the State Street location, given the hundreds of thousands of workers and new residents of The Loop and nearby neighborhoods. To make it truly successful, the Macy’s North group should take a trip over to the UK, and STUDY how Selfridge’s, Harvey Nicols, M&S, Harrods and John Lewis and the other major department stores prepare, package and merchandise their food halls, since that is really the only way it will work in The Loop….something not available anywhere else.
That said, given Macy’s frankly lower-tier approach to customer service, marketing, packaging, and maintenance, I cannot see them pulling this off with any credibility or savvy. They seem to be working overtime to burnish their image in Chicago (and nationwide) as a faceless and unexciting mass market retailer. In Chicago they have the added burden of shaking off the ‘in cold blood’ image of the company who killed the signature store of that region, just to take over the real estate and locations.
The situation for Macy’s at State Street is more dire than just installing a supermarket in the basement. They need something more dramatic to drive traffic there, but at this point they appear to be looking to any time-worn rabbits out of the hat of supposed ‘unconventionality’ to make that location work.
This is another result of the unfortunate after-effects of corporate hubris and marketing blindness that drove this merger/takeover. Macy’s was repeatedly warned of the ramifications of destroying the Marshall Field’s brand. After Mr. Guzetta’s comments last week of saying to former loyal Field’s shoppers, we really don’t need you, I cannot see how a smallish 20k market, operated as one branch of many, or developed and operated on the cheap by Macy’s themselves, will be enough to make a dent in the sales drop at State Street.
The ONLY solution to keeping the Chicago division of Macy’s North alive is to rebrand and re-merchandise it separately as Marshall Field’s. Get it out from under the fold of the bland nationwide Macy’s brand, and maybe then they won’t have to throw so many ideas out in an effort to bolster sales.
If Marshall Field’s was Chicago’s favorite store, I’d hate to see how it treats its least favorite. On second thought, nix that, we know Macy’s State Street is the least favorite. Favorite or least favorite, either way, they both lost money. I don’t see the harm in trying grocery, it’s not as though Macy’s has an image to protect in Chicago.
Putting nostalgia for Marshall Field’s aside, I’d like to focus on John Rand’s reference above to Tokyo’s downtown departos, like Isetan and Seibu, which offer tempting delicacies, prepared foods, and attractive bento boxed meals ready for the office or commuter train.
I recall from a visit a few years back that the vendors seemed to be independents who rent space from the host in the basement arcade. Competition kept the atmosphere inviting and the selection varied. Think upscale bazaar, but with very polite shop clerks, and beautiful wrapping paper.
Adaptation of this concept could translate well in downtown locations, like Chicago’s Loop. So could elements of the fondly-remembered Macy’s Cellar concept, also referenced above, which combined an upscale delicatessen/gourmet shop concept with kitchenware and a decent sit-down restaurant.
By comparison, a Whole Foods, Trader Joe’s or similar tenant seems like a force fit in The Loop.
The Loop (and adjacent areas like Lakeshore East) is one of the fastest growing neighborhoods in Chicago. Many of the commenters obviously haven’t been to Chicago recently. It’s not your Daddy’s Loop any more. Right now, residents need to drive or hop the subway up to Division or down to Roosevelt to buy groceries. Besides these residents, there are the million plus people who work in the Loop. As a non-driver who works in the Loop, let me tell you that a grocery store in the Loop that is one block from all of Chicago’s subway and el lines would have a definite advantage to draw Loop workers, particularly if it emphasized ready-to-(reh)eat meals.
HOWEVER… Macy’s has demonstrated quite clearly that it is incapable of delivering an upscale product offering, at least upscale as we in Chicago understand it. Macy’s talking upscale is kind of like Safeway talking upscale and we all know what happened to Dominick’s.
A store-within-the-store like Trader Joe’s may work, but would any retailer be willing to take the chance to partner with Macy’s? The remaining shops-within-the-store boutiques like Barbara’s Bookstore and Merz Apothecary do not hesitate to state publicly that foot traffic is down considerably and that their sales have suffered. Chicago is ANGRY with Macy’s. (Really, Frank Guzzetta, just who do you think DID NOT have an emotional connection to Field’s in Chicago?) Why risk bearing the brunt of that anger when the Carson Pirie Scott building and Block 37 are soon available?
I see this as another PR stunt by Macy’s to deflect attention from the reality that the State Street store is going down and the situation is worsening, not improving. Macy’s keeps coming up with these grand plans to fix something that wasn’t broken when it bought it. The answer to the State Street store’s problems is simple. Just put it back the way it was and the customers will return.
I find it surprising that Macy’s continues to try unproven tactics, like opening a grocery store in the flagship instead of giving the customer what they want. Chicago has spoken loudly (maybe a little too loud!) but they want Marshall Field’s in name, quality, and service. Again, this is a decision driven by Wall Street not Main Street or State Street for that matter!
What I think Macy’s should do is consider three scenarios for their basement market.
1. Consider an alliance with UK department store retailer John Lewis. JL also owns the upscale British grocery chain Waitrose. JL just opened its first department store food hall in England (leveraging their Waitrose expertise). The basement food hall is doing very well–even though it’s far smaller than 20-k square feet. Macy’s might consider a strategic alliance with JL, putting combination Waitrose upscale supermarkets and food halls in selected Macy’s stores like in Chicago. NYC and San Francisco have potential in terms of this alliance and the Macy’s department stores in those cities.
2. Etaly, an innovative Italian grocer is coming to NYC next year. Etaly currently operates a very successful 30K square foot grocery in its homeland. The NYC store will be a much smaller version but will still feature much of what the grocer offers in Italy. The Italian store is a unique blend of fresh food, specialty food and food educational retail. You can read more about is at www.naturalspecialtyfoodsmemo.blogspot.com if you like.
I think Etaly would be an out of the box move for Macy’s–it also fits in well with its Cellar gourmet food shops. It also gives a focus to the operation. I don’t think a basic natural/organic food store is the best move for the department store operator per se.
When Macy’s talked to Supervalu they really talked about the wrong SV format. Sunflower Market is essentially positioned as a “category killer” type of natural foods store. It has much less frills than a Whole Foods store for example–but has lower prices on natural and organic groceries, perishables and fresh produce. It really doesn’t fit the basement department store concept.
3. Bristol Farms however–being both a gourmet and natural foods format–fits the concept much better. And BF does in-store prepared foods well. And for Supervalu this might be an opportunity to try BF outside of California. I think it’s an underused format for SV.
So, those are three options I believe are much better for Macy’s than what they are looking at currently. Whole Foods isn’t going to want to go into that basement with only 20-k square feet of selling space. It just doesn’t fit their merchandising regime. Essentially, if Macy’s wants an organic grocer that leaves one of the small regional operators or an independent. I don’t think that will fly.
As Marshall Field’s, the State Street store was one of the world’s great department store destinations. Far from being in decline, Marshall Field’s on State Street was flourishing, having undergone a $115 Million renovation completed in 2004 with significant upgrades to the building and merchandise, Field’s continued to attract more than 9 million customers to this one iconic location each year making it the city’s third most popular tourist destination.
The value Marshall Field’s provided to Chicago was far more significant than simply a first-class shopping experience and the many museums and traditions Field’s pioneered. Marshall Field’s name represents the best of Chicago culture and style to the world and helped to define the unique character of the city through word of mouth, public relations and tourism promotions. When Macy’s eliminated and replaced the Marshall Field’s name, it did a huge disservice to Chicago.
The steep decline in same-store sales Macy’s posts compared to Marshall Field’s has created many new customers for Field’s competition in Chicago, in part explaining the jump in sales at Neiman’s, Saks, Nordstrom and Barneys. At the same time, Macy’s has difficulty competing with its own mid-tier and discount competitors, in part due to anger and resentment felt toward Macy’s brand and in part because Macy’s pricing on comparable items is higher than at its own targeted competitors Walmart, Target, Kohl’s and JC Penney.
The ongoing detrimental impact Macy’s takeover expansion strategy has had on former Marshall Field’s employees, vendors and communities adds fuel to the anti-Macy’s fire in Chicago. Thousands of jobs lost, those remaining have seen their commissions and salaries cut, local vendors like Hart Marx have been replaced by off-shore outsourcing of Macy’s generic private label brands, and drops in revenues result in lower tax receipts for Chicago and other Field’s markets.
Macy’s drop in Field’s former high-end customer traffic has hurt State Street–desperate to maintain that appeal and for mall operators throughout the region.
Macy’s might consider the bold move to restore Marshall Field’s–at least on State Street–in order to appease customers and gain some much needed positive PR in Chicago. The outcry against Macy’s and for Marshall Field’s return a full year after the change demonstrates that Field’s brand value is as strong as ever. This would be an appealing investment for someone able to put together a team skilled at managing and rebuilding an iconic high-end brand, thus quickly building value for a subsequent sale to an established merchant group.
Mr. Robinson who commented previously, apparently enjoys lingering in the past. The old (somewhat stale and not so profitable) Marshall Field’s brand is HISTORY. Out with the old & in with the new! While it is not likely that Macy’s will be teeming with housewives flocking in to do their weekly grocery shopping…they may VERY possibly be able to attract the downtown working people who comprise the exact demographics that TESCO is targeting in their new Fresh & Easy format. Working people (& couple) who are looking for healthy, fresh, home meal (& restaurant meal) REPLACEMANT…at a VALUE! People who have more money, sense & taste than they do time. Kudos to Macy’s for replacing the tired “Food Court” idea with a fresh one.
I do not see this as an exciting feature that would draw me into the store. People are going to assume that:
1) Prices will be inflated due to the location;
2) Freshness and cleanliness issues could be carried over from previous incidents;
3) A continual perceived “failure” to successfully operate a traditional department store.
A food hall could be a better idea. Macy’s could stand to take a few lessons and learn from their peers across the pond.
The comments might be confusing 2 unrelated issues: Marshall Field’s and groceries. Whether the State Street location has an upscale creative food hall or not, the folks who swore eternal antipathy towards the Macy’s brand name won’t be satisfied. Their issue is the loss of Marshall Field’s, period. If Macy’s builds a food hall in State Street, it will probably be an upscale assortment with a lot of the volume sold to folks who work nearby, for their lunches. It’s too hard for most folks shopping on State Street to drag heavy grocery bags home, commuting by bus and train. And any delivery charge would be breathtaking.
“Those people, no matter how hard we worked at it, have continued to be detractors.”
That is probably true, though it seems to be a(n almost) theoretical point, since I’d be hard pressed to name many things Macy’s has tried (The 8-steps-backward-1-step-forward of dumping high-end labels for fabricated–in every sense of the word–house brands doesn’t count.)
Which brings us to the latest idea: is it a bold and innovative concept, a desperate attempt to fill space, or just a dumb idea? (Depending on execution, it could be all three.)
What I’d really like is for Macy’s to make an exception and pull back its Stalin-like veil of secrecy for once: State Street was (purportedly) doing $250 million/year before its Macyizing; what’s it doing now?
The more I read, the more I compare this type of situation to the fall of J.L. Hudson in Detroit. It lost money, no one would invest, it closed, it got demolished, and the nail in the coffin of shopping in Detroit took it’s final blow. That’s not to say that it hadn’t taken that blow already long before that. The loss to Detroit was sentimental more than it really hurt. The damage was done years prior.
From what I can gather in Chicago, MF was losing money, it was not being supported by the city, and someone else offered to try. Because they wouldn’t leave it the same, the community who didn’t support ‘the same’ won’t support the new either.
This may or may not be the best idea in the hat, but at least its an idea and an effort. For those in Detroit, they had neither. They wound up with nothing. The result was a city that continued to be abandoned by investment. Its deterioration was well underway and it continues. Maybe those in Chicago who are so upset with Macy’s should take a four hour drive to Detroit and see Woodward Avenue. They just might be looking into the future of Michigan Avenue if their attitude remains the same.
This is not to say that bad investment should be accepted rather than no investment. However, it’s not like Macy’s is really that bad. I’m quite please with ours. I reluctantly tried it, figuring it couldn’t possibly be Marshall Field’s or Hudson’s. It’s not bad, and my experience was good. They have challenges–all retailers do. I’ve seen Detroit and lived near it most of my life. I wouldn’t wish it on Chicagoans.
I think Macy’s will need to have a very special offering for this store to succeed in busy downtown Chicago…Whole Foods, Trader Joe’s, or a Super TESCO might make sense. They will also need to provide some easy in-and-out parking in their garage to incent the grocery shopper….
Perhaps the question should be, “Why on earth would you put a grocery store on that part of State Street?” A food hall, a la Harrods, sure. A grocery store where nobody lives or drives to? I don’t think so. The upside to such a decision is that all of us who comment at this site will have new material to work with when we talk about retail mis-steps.
First of all, there are other areas to consider before jumping into the grocery business. Why is it that the loyal customers of Marshall Field’s don’t like the Macy’s change? What could Macy’s emulate from Marshall Field’s to gain that loyalty?
Under the circumstances and in keeping with the quality branding of Macy’s, it probably makes more sense to partner with Trader Joe’s or Whole Foods rather than try to enter this market as a novice. In Chicago, this would be definitely a draw and may lure some old MF customers back.
I had an invisible conversation with that great grocery guru, Yogi Berra, and he allegedly said, “It’s deja vu all over again.” Department stores such as Kmart, Sears, etc. have tried to pull in new and more customers with leased grocery stores in the past–but perhaps not today’s “organic” kind.
Macy’s understandably is looking for something that can make up for dropping the Marshall Field’s name in Chicago, or at least neutralize it, but adding groceries in its flagship store on crowded State Street doesn’t strike me as thinking outside the box. Carting groceries along with other purchases to your car parked “somewhere near” that store or on a crowded bus or on the L to your home or apartment seems more burdensome than magical. However, a specialty type operator offering unique smaller packaged products such as Trade Joe’s or the new U.S. Tesco type might have some magnetic appeal to those folks looking for new reasons to saunter through Macy’s-on-State.
Macy’s needs to focus on their core competencies, and selling groceries is not one of them. So right at the start, they would need to move forward with an established partner. And as others have pointed out, having a traditional,even if it is an organic one, does not make any sense. They need to mimic the Food Halls of Europe if they plan on having any success.
Macy’s opened a similar concept in their New York store with Brinker’s Eatzi’s. It did not work for them in NY; I’m not sure why they think it will work for them in Chicago.
What goes around comes around! Years ago, department stores throughout the country had grocery stores in their basements. In a metro area, this can be an asset to the city and the inner city population.
Someone already said it–this has been done before. Occasionally, it has been done well. Oddly enough, it was done well by Macy’s many years ago in Manhattan, where they successfully created a cross between a food court, a grocery store, and a basement bazaar. I remember wandering around in there on a Saturday several decades ago and marveling at the food, the variety, the merchandising, the smells…it was very well done. And it was all what a grocery store today would call “perimeter”–along with some excellent cross merchandising in cookware, table linens, kitchen appliances, etc.
I never knew why they stopped. Was it unprofitable? I didn’t have a reason to know, back then, and never heard the rest of the story. But as a shopper and confessed foodie, it was wonderful. I knew many people who came in from New Jersey just to stock up on delicacies there, both fresh and shelf stable.
Something like this exists in Japan’s “depatos”–the large department stores have ground floors where you can buy a boxed lunch, fresh meats, produce–almost all the core food offerings, minus a lot of the packaged CPG products that form the center of a conventional US grocery store.
Of course, if you expect a full basket trip in a downtown commercial area, you are probably going to have problems. But for some sort of fresh food offering plus a smattering of convenience for both the city dweller and the office kitchen? Works for me.
A high end grocery store at the former Marshall Field’s store would probably work. If they do it, it should be unified with their celebrity-oriented campaign that they’ve embraced for this season. (Out with the 2006 brand building dancing girls and in with cast offs like Martha, Donald Trump and Tommy Hilfiger.)
But come to think of it, aren’t there many better ways to build traffic and loyalty from the 25 – 40 year old loop business types that Macy’s so fervently desires?
Here are three:
1. Sell to brides. Lots of the desired demographic get married, have a big celebration, buy a house, and fill it with stuff. Maybe, Macy’s can buy a chain to build a foundation to build loyalty from this segment. Oops. Wasn’t David’s Bridal part of the May deal and Macy’s let it slip away?
2. Rent formal wear to guys. When guys go to a formal function they typically rent a tux. This requires them to make at least three trips to the store: to get fitted, to pick up the tux, and to return it. Maybe, Macy’s can buy a chain to use a foundation for this core business. Oops…wasn’t After Hours Formal Wear part of the May Company deal and Macy’s let it slip away?
3. Change the brand of the store to one well loved by all Chicagoans. When Chicago families teach their kids how and where to shop, they typically take them to Marshall Field’s–the great downtown emporium. Then when their kids grow up and have children of their own, they do the same. Oops…wasn’t Marshall Field’s one of those department store names that Macy’s let slip away back in 2006?
Well, you can’t blame them for trying. Macy’s is trying to gain foot traffic in the store…especially in a major metro where ready-to-eat groceries and fill-in may lead to impulse items across the aisle.
But that may be part of their challenge: getting consumers to cross the aisle. Look at Target–they have had trouble getting just such cross-over. The question in my mind is: what’s the brand equity here?
Based on recent blogs, news media coverage and my own personal experiences, I disagree with Mr. Galman.
Macy’s has let down many Chicagoans with its elimination of the favorite department store of Chicagoans…I am wondering if Mr. Galman is a Chicagoan himself and understands that even though Marshall Field’s is now in the past, it was cherished by many in the Chicago area and now its an empty hole to walk into our local Macy’s.
-House brands have replaced familiar name brand.
-Classy background music such as Jazz and Pop has been replaced with Light Rock.
-Strict Facilities Upkeep formerly kept very clean by Target is now nothing more than dirty floors and burnt out lighting.
-Any reference to Marshall Field’s other than the plaques on the exterior of State Street have been destroyed
-Classy paper shopping bags have been replaced with cheap plastic bags.
-Customer service has been cut drastically. It was almost annoying how much service you would experience at a Field’s store under Target or previous owners…the employees were so helpful it was scary!
-Free shipping from another store when a product is not in stock was eliminated as well.
-Marketplace Food service operations went from first class clean operations to fruit fly infested food courts and low quality food choices.
-Where lighting has been changed in the sales floor, makes little to no sense…classy displays and dramatic lighting has been replaced with cheap white lensed fluorescent fixtures.
The most annoying aspect of the Macy’s scenario in Chicago is their lack of understanding of Chicago shoppers and the local market. Their public relations has been as tragic as the Titanic. Frank Guzzetta, Macy’s North President, had the gall last week to be quoted in the Chicago Tribune as saying:
“There are a lot of people who just can’t get over the Marshall Field’s name change…Those people, no matter how hard we worked at it, have continued to be detractors.”
So tell me Mr. Guzzetta, what kind of retailer would call their customers detractors and give up on them? Not a good retailer in my opinion.
Numerous other things Macy’s has implemented have turned a gem of a store into nothing more than a chipped piece of concrete.
In my opinion, Macy’s should have learned from the Safeway Dominick’s debacle in Chicago…they should sell the Macy’s North Division to a company who cares about the hearts and desires of Chicagoans. I don’t see how adding a grocery store can smooth over the mess of eliminating Chicago’s favorite store.
Macy’s, “way to flop.”
When the State Street building was constructed, Marshall Field’s sold everything. They had a philatelic department, a book store, sporting goods, white goods…. The men’s and women’s hat departments were real departments, not just tree stands. Most of these departments are long gone from the present day US department store.
Macy’s is looking to fill the empty space and is taking the approach of the small town landlord who created a mini-mall in the old department store that vacated when Wal-Mart came to town. The State Street store is obsolete. Macy’s needs to either down size or completely vacate the space and let the real estate professionals figure out the highest and best use.
The wisdom of adding groceries to the State Street location depends on its strategic purpose:
1. Is the goal to draw more traffic into the store by adding commodity categories, whether or not Macy’s partners with a company like Trader Joe’s?
2. Is the goal to provide a convenience to the growing numbers of residents in the mid- and South-Loop neighborhoods?
3. Is the goal to provide a true “food hall” experience like Harrods (as another commentator mentions)? This might provide the State Street location with some much needed cachet but not necessarily the traffic frequency of a more convenience-based option.
This is one of many ideas that Macy’s is tinkering with, in an effort to gain acceptance of its nameplate on the State Street store, without addressing the other fundamentals that have cost it business at many other former Marshall Field’s locations.
I agree with one of the last comments, that most haven’t been to the Loop recently. I was there during the summer, and besides the CVS or Walgreens on about every block, getting some kind of supermarket fare is few and far between until you venture into the North side neighborhoods, away from the Loop and the Magnificent Mile.
My nephew recently moved to Downtown Chicago, and both lives and works near the Loop, next to Grant Millennium Park. How he and tens of thousands of other workers/inhabitants of the area would welcome that supermarket in the basement of Marshall Field’s. ( I too, can never accept Macy’s conversion of that great store).
Anyway, the Cellar, originally started in the basement of the Macy’s 34th Street store. What better way to utilize the Marshall Field’s lower level space than with a supermarket.
Deja vu all over again, and very welcomed. The supermarket and the grand downtown department store were always made for each other. Be it Trader Joe’s, SunFlower, Dominick’s or Whole Foods, my nephew would be a loyal shopper.
At least Macy’s could finally get one thing right at that Marshall Field’s location.
Whole Foods and Trader Joe’s are far too upscale for a store location that, per their own press releases, in increasing womens wear plus-sizes and young men’s departments. Those are hardly signs of a store on the upscale move. Quite the contrary.
Marshall Field’s Marketplace worked because of the high quality food and wines combined with the panache of the Marshall Field’s name.
This location needs to be sold to Selfridge’s and reopened as Marshall Field’s and Company in the Selfridge footprint as it was being redesigned and, I believe, performing quite well in despite problems elsewhere in the MF chain.
If they had kept it Marshall Field’s, then the logical addition to the store would have been a Fox & Obel outlet in the basement, offering high end purchases that could be carried or delivered to nearby apartments, as is done at F&O in their River East location. But as Macy’s, they will not be delivering a high-end shopper, so they need to go more down-market.
I was in the store yesterday and there was no one at the newly opened Sarah’s pastry shop. I suspect it is too expensive for the kind of shopper Macy’s is attracting. Their shopper is more Aldi’s than Fox & Obel.
There lies the root of their problem in Chicago; you can not attract high income shoppers to a store that the market equates with low end merchandise and service.
Here is what I said in June ’06: “My prediction is that sales will be off so dramatically at State Street that there will be talk within a year of down sizing it to better serve the customers. Sad indeed.” Watch for this to happen in ’08.
Marks & Spencer does exactly this in the UK. It failed in the US, but that was a decade ago.
Build great high-end private brands and you can sell anything to the customer once she’s in the store.