Retailing 2009: Everything old is new again

BusinessWeek quotes the CEO of Macy's saying: "You have to do something different." For Macy's, that means starting to tailor the merchandise assortments in its 811 US stores to local tastes.

Now it wasn't so very long ago that department stores did just that--before the days when mega-retail corporate parents bought up local chains and homogenized the buying process.

The local chains were as close to their customers as it was possible to be, and they knew how to compete through distinctive merchandising. In other words, they were merchants and were in tune with their shoppers' lifestyles, preferences, and buying habits. Customers understood what retail brands stood for, and they made their choices accordingly.

Davison's, in Atlanta, was a part of Macy's long before the parent erased the local name in a move to give Macy's a national brand identity. Shoppers in Atlanta could tell the difference between department store rivals Davison's and Rich's, not just because of the names but also because of the way the stores looked, the merchandise they carried, the services they offered. (Wikipedia chronicles the history that led to Rich's and Davison's becoming part of Macy's and eventually losing their separate identities, if you're interested.)

Similar retail dramas played out in Chicago, in Philadelphia, in Cleveland, all over the country. Local brands and local approaches to merchandising went away as national retail chains sought efficiencies of scale through centralization.

Now, in the retailing world of 2009, everything old is new again, with Macy's trying to give local shoppers what they want. Looking at the big picture, sales help is scarce in most stores. Price promotions are prominent. And too many malls have empty storefronts.

Retailers absolutely must return to their merchant roots by responding to and even anticipating nuances in customer wants, needs, and buying patterns. Retail brands have to stand for something meaningful to local shoppers. If every store offers the same brands at approximately the same prices, why would customers buy on the basis of anything other than price and convenient location?