Why did Bon-Ton fail while Macy’s did not? 

Through a special arrangement, what follows is a summary of an article from COLLOQUY, provider of loyalty-marketing publishing, education and research since 1990.

Many factors played into the demise of Bon-Ton Stores, but its turning point may have been in 2005, when it acquired Saks’ Northern Department Store Group. But Macy’s made its own risky move that year when it bought May Department Stores, cementing itself as the nation’s largest traditional department store chain.  

What caused their paths to diverge since the mergers?

1. Matters of size. In taking over May, Macy’s became a 1,000-store coast-to-coast chain to secure even greater negotiating power with vendors. While doubling its size in key Midwestern markets with Saks, Bon-Ton still had fewer than 300 doors.
2. The names on the doors. While triggering blowback from many locals, changing all of the nameplates of May’s store brands, including Marshall Field’s, to Macy’s enabled Macy’s to reduce and better manage its national marketing budget. For Bon-Ton, maintaining the many names of its acquired stores (likely due to regional brand loyalties) meant different ads had to be created for each brand and its market.
3. The markets mattered. Macy’s, with May, strengthened its coast-to-coast presence with positions in nearly all major cities. Bon-Ton remained a regional player, operating largely in secondary and tertiary markets.  
4. Brand-wide tech adoption. Macy’s national presence enabled it to more seamlessly adopt a corporate-wide omnichannel game plan, including online fulfillment from stores and BOPIS.
5. Exclusive names on the products. Bon-Ton secured Ruff Hewn and Laura Ashley in its Saks’ acquisition, but Macy’s by then had a stable of in-house brands and exclusive third-party deals. Bigger deals, including Tommy Hilfiger and others, came with Macy’s expanded presence and some of these same brands had to withdraw from other stores, including Bon-Ton’s.   
6. Family matters and size. With Saks bigger than the acquiring Bon-Ton ($2.2 billion versus $1.3 billion in 2004), the size of the deal and the changes to operations management likely required may have weakened Bon-Ton’s traditional family-business culture.

Macy’s in August 2016 announced plans to close 100 locations and still might not have skirted all the challenges its operations brought with the May acquisition, despite its recent improvement. The next chapter may reveal just how resilient century-old retailers can be in finding their paths to success.

• The Six Factors That Distinguished Bon-Ton’s Fate From Macy’s – COLLOQUY