Jennifer Roberts was surprised the first time she saw bins jammed with marked-down merchandise at Marshall Field’s.
A costume designer for Steppenwolf Theatre Company, she knows Chicago’s department stores well. But Roberts could not fathom why Field’s would present its inventory in such an unappealing fashion.
“It was sort of Target-esque,” she said. “It struck me as a lower-scale thing, and my question was, `What grade of customer are they selling to?'”
It’s a question many Field’s shoppers and retail industry professionals are asking these days.
Competing in one of retail’s toughest segments–the mall-based department store–Field’s has seen sales at stores fall steadily over the past several years as shoppers increasingly turn to competitors at both the low and high ends.
Now, 14 years after buying Chicago’s storied Marshall Field’s chain, Target Corp. is exploring options to sell the struggling retailer. It is also shopping its Mervyn’s division, a department store chain found in 14 Western states.
Target wants to sell both department store chains, which could fetch as much as $3 billion, so it can devote more resources to its namesake Target discount chain.
Mall-based department stores such as Field’s are caught between aggressive off-mall competitors, including Wal-Mart Stores Inc. and parent Target, who cater to price-sensitive buyers, while high-end retailers such as Nordstrom Inc. draw a more discriminating shopper–the type Field’s once lured.
Take Barbara George, 60. She recalls a more genteel Marshall Field’s, what she called “the” department store to patronize in the 1950s and ’60s.
“Nordstrom’s is the standard now,” George said, citing superior service.
Chicago shoppers point to several self-inflicted wounds that hurt Field’s and punctured the aura once associated with the department store. They say the 1990 entry of Dayton Hudson Corp.–now Target Corp.–into Chicago was akin to putting a bull in a china shop.
Within a decade of its acquisition, Dayton Hudson stopped making Field’s trademark Frango mints in Chicago, temporarily abandoned its recognizable green shopping bags and cut corners in the type of gift boxes it handed out.
It also put 900 Chicagoans out of work when merchandise buying, administration and other operations were moved to Minneapolis, headquarters of Target and now Field’s.
“Now we’re seeing plastic bags and crazy ’70s striped bags, which is not Marshall Field’s,” said Chicagoan Elizabeth Sample, 35, who recalled trips with her grandmother and mother to the famed Walnut Room at the 800,000-square-foot State Street store. “My mother came to visit in January and said, `What’s going on with these bags? They look hideous.'”
But while some shoppers criticized Field’s on Thursday, retail experts were more understanding. Such moves are part of the reality of retail consolidation, they said.
“By centralizing your buying, you reduce costs of the individual properties,” said George Rosenbaum, chairman of Chicago consumer research firm Leo J. Shapiro and Associates.
The department store sector has “not been the best-performing channel over the last 10 years,” added Arnold Aronson, managing director of retail strategies for Kurt Salmon Associates, a consulting firm.
He is also is the former chief executive of Batus Industries Inc., which sold Field’s to Dayton Hudson.
Because of its relatively small size, Field’s was “more constrained than major chains like Federated or May. That had some effect on its ability to rise above the average,” he said.
Field’s has annual sales of about $2.6 billion, while Federated Department Stores Inc. and May Department Stores Co.–two potential buyers–each have revenue exceeding $10 billion.
“J.C. Penney is centralized. May is fairly centralized. Federated is a little more autonomous but it has made moves to centralize,” Aronson said. “So the trend in the competitive world is to get economies of scale.”
As for the other, seemingly cosmetic changes to the gift boxes and shopping bags, Aronson said they “are real and palpable to the outside world.” But to the company, they are “internally a small measure of why results” fall short.
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The recent changes are very real for 75-year-old Antoinette Recupido, who remembers a Marshall Field’s with an entirely different feel.
“Years ago, the girls were so well-mannered. Their suits were beautiful, and they wore white gloves,” said Recupido, who has shopped at Field’s since childhood. These days, “it’s not the same.”
Still, shoppers can have a tendency to look at the past with rose-colored glasses.
Field’s once had a reputation as a slightly dowdy merchant geared to the least daring of consumers.
“Marshall Field in this city was for many years an institution, an integral part of Chicago,” a retail expert told a St. Paul newspaper in 1990. But “they were on the wrong side of the fashion curve. They were putting clothes in when they should have been taking them out.”
After the acquisition, Dayton Hudson officials said it was a good deal because both chains appealed to moderate- and upper-income fashion shoppers and that 90 percent of the merchandise overlapped.
But by the mid-1990s, Target admitted that Field’s had been hurt by a move toward less-expensive goods. It cheapened the brand name of the Chicago institution.
Still, changes over the past 14 years have been transparent to some shoppers.
Diane Storey, who has shopped at Field’s once a week for the past 35 years, does not think the department store has changed.
“I like the quality, the prices are reasonable, and the way they treat you is really nice,” she said Thursday on her way to buy stockings at the Field’s in Water Tower Place.
“I really don’t see the difference,” agreed 65-year-old Charlena Green, who has shopped at Field’s for 30 years. “Whatever I come for, I can find, and the service is just about the same.”