Reinventing the US Department Store
In this report, we assess how US department stores are transforming themselves to stay relevant.
- Most department stores continue to face intense pressure from online rivals, discount chains and big-box retailers.
- The key factors are lack of adequate upgrades, declining mall traffic and a decrease in the middle-class population.
- Some leading department stores, such as Nordstrom, Macy’s and Kohl’s, are reinventing themselves by rightsizing operations, embracing new and intelligent technology and collaborating with other retailers/unique partners.
- Some department stores are leveraging private label and exclusive brands and expanding omnichannel retailing with buy online and pick up in store (BOPIS) strategies.
- To tackle the challenges of online rivals, Nordstrom and Macy’s are revamping their customer loyalty rewards programs, while Kohl’s is piloting a new one.
- Macy’s is testing experiential concepts, including virtual shopping and pop-up marketplaces.