by

Department Store Industry

1: INDUSTRY OVERVIEW: DEPARTMENT STORES

Department stores are large retail outlets that contain numerous individual shops, providing a wide range of product lines. Department stores most oftentimes consist of the following product categories:

1)      Food

2)      Cosmetics

3)      Shoes and Accessories

4)      Clothing

5)      Interior Décor

6)      Restaurants

Depending on the type of department store, department stores can offer a much wider range of products, including furniture, toys, electronics, books, etc.

Department stores come in a wide range of qualities and prices. There are such things as “high-end department stores”, which would focus purely on offering high-profile brands and products, while there are more mass-market targeting department stores, which are more likely to include a wider range of products, including practical household products.

That said, department stores will oftentimes try to cater to specific types of market segments. Particularly in the case of department stores in large cities, each department store will try to position itself differently from its direct and nearby competitors: some will try to cater to younger generations, while some will try to cater to the older generations. Some will try to cater to those interested in mainstream brands, while others will focus more on boutique, independent brands.

In the US, the department store industry includes approximately 20 companies operating roughly 3,500 stores. Major department stores in the US include: Sears, JCPenney, Macy’s, and Dillard’s. The industry earns an annual revenue of around $60 billion USD, 95% of which is earned by the largest 8 companies in the industry.

Some links about the industry:

http://en.wikipedia.org/wiki/Department_store

http://vspages.com/mall-vs-department-store-5580/

http://en.wikipedia.org/wiki/Shopping_mall

http://www.hoovers.com/industry/department-stores/1529-1.html

 

SPACE

2a: Implicit or Explicit?

From the department store owner’s standpoint, I would say that space is often sold explicitly, as they would charge the tenants per the size of the lease space. On the other hand, for stalls or booths set up in more open areas of the department store, space may be considered more implicit, as these spaces may be sold with less correlation to the exact size of the space.

2b: Ways of Splitting Space

Department stores have different types of spaces within the building that cater to their customers. The most typical type is the space split by fixed walls into one unit, and can usually be shut off or closed by a door or a shutter. These spaces cannot easily be adjusted in terms of size and layout without investment of significant time and money. These fixed spaces are generally leased out to a specific brand or company, such as Zara, Coach, Burberry, etc.

 

Then there is the semi-fixed space, such as the department store areas dedicated to selling cosmetics or shoes. These are oftentimes open areas in which a specific brand or merchandising line take up certain spaces, but are not divided up by physical walls or entryways. These areas are much more flexible in terms of changing the products being handled, given that one area can easily be changed to carry one brand/line from another; however, certain fixtures used for the displays will be fixed, and hence less flexible to change from a layout perspective.

 

There is also open space, in which temporary booths or stalls are built to sell a smaller line of products or services.

Different from other uses of store space is the use of space to purely focus on selling experiential services. For department stores, the focus generally remains on selling physical products. However, there are rare instances when space is allocated to selling services—one case being when department stores are attached to movie theaters.

 

 

 

 

 

 

 

 

 

 

 

 

2c: Creating Additional Revenue

One of the most standard ways for department stores to create additional revenue is by holding major seasonal sales. Because the product life cycle of clothes tends to be fairly short, many stores have inventory left over by the time they have to replace old products with new products. Having a highly publicized sale allows for these leftover products to be sold, be it at a lower price than its retail value.

One key to making people spend more money is to convince people to stay out shopping longer. A way to do this is to provide adequate opportunity for people to take a break from shopping and rest. Many department stores provide these venues by creating food courts—or in high-end places by providing patisseries or coffee shops at which people can recharge before going back to shop some more.

I also think one of the more creative ways in which department stores have used their space to create additional revenue is through creative use of its open space. Another approach department stores can use to bring people to their stores is to provide an additional incentive to go to that location. A common approach used to achieve this in the U.S. has been to create playgrounds in the open areas of the department stores. This service often incentivizes families to go to a department store, simply because it allows an opportunity for their children to play.

 One more approach commonly used in Japanese department stores to bring more people to the site is to host certain “festivals” or special events in their open space. For example, department stores would often host weekly “mini fairs” on either the ground floor or the top floor, in which one area of the department store would be devoted to hosting jewelry/clothes/food from brands and shops that usually were not represented at the department store. The content would be changed frequently, and the department store would often be able to bring new people into the store by publicizing new, limited-time genres of offerings at their store.

2d: Potential New Ways of Splitting Space

There are several different directions department stores could potentially go in terms of splitting space differently. One direction would be to use space to create more personalized services to customers. Many of the spaces in department stores are “public”, but allocating a portion of space at high-end stores to allow for “private” space may allow for varying experiences for customers. Customers would be charged a premium for making use of these private spaces.

Another potential use may be to make the spaces more flexible. Instead of sticking with a model that leans heavily toward having “fixed” spaces, changing to a model in which it would be much simpler, cheaper, and quicker to change tenants may be an attractive approach for department stores that are pursuing a more trendy, up-to-date feel.

3: TIME

3a: Implicit or Explicit?

Department stores generally sell time implicitly: this is because the product being sold generally isn’t associated with a particular time limit. For example, it is not like a massage, where you are buying 60 minutes worth of service. The transaction is associated with a physical product unattached to time.

3c: Selling Time Explicitly

Time is currently being sold explicitly at certain department stores, although these cases are generally not a reflection of its overall business model. For example, some department stores may include shops that offer time-explicit services. Some department stores have massage shops, which are time-based service sales.

 As another example, some department stores in Japan have small football fields on their rooftops, which people can rent out on an hourly basis.

(http://www.futaba-sp.com/omiya/2010/03/post-23.html)

 

 

Some department stores also include game centers for children—some of these entertainment options include machines that run for a set period of time per game.

 

 

 

Department stores will often have restaurants on one of their floors. These restaurants can often choose to set time limits to each group of customers (ex. 2hr limit) to be able to take in more customers during peak times.

(http://www.mitokeisei.co.jp/shop/10_skygarden/11keizan.html)

 

 

 

3d: Creative Things to do with Time

There are a couple things that could be done creatively with time—some of which may already be being done to varying lengths at department stores. One might be to offer some sort of benefit if a certain amount of time is spent within the department store. For example, if a customer was to receive certain benefits if they stayed for 5 hours at a department store on an off-peak day, this could incentivize customers to spend more money during their wait time, and this could also help to improve the image of the department store by maintaining more customers.

 

Another thing they might potentially consider doing is to include shops that provide rental services. Some shops may already do tuxedo/dress rentals, which would be time-based; they could potentially take this further by doing time-based rentals of other high-end luxury clothes and accessories.

4a/b: Physical and Non-Physical Rate Fences

Below are several examples of physical rate fences (owner-tenant relationships are more likely to be involved with physical rate fences than the tenant-customer relationships)

  • (Owner-tenant POV) Depending on the size of the space being rented, owners can choose to increase or decrease the rates
  • (Owner-tenant POV) Certain areas of a department store are likely to be more popular/convenient; hence an owner can charge more depending on the location of the space within the store (http://www.ehow.com/facts_6313023_average-retail-lease_.html)
  • (Tenant-customer POV) For services such as restaurants within the department store, tenants can set rates by charging differently between open areas and private rooms

In terms of non-physical rate fences, I would say that there are many opportunities to create rate fences, depending on the type of service/product the store sells. There are also several opportunities within the owner-tenant relationship:

  • (Owner-tenant POV) Depending on the lease period, the owner can set different rates to charge the tenant
  • (Owner-tenant POV) Depending on the credibility/attractiveness of the tenant, the owner can set different rates
  • (Tenant-customer POV) Depending on the quality of the product, functionality of the product, or time/length of the service, rates can be set differently. There is an enormously wide range of examples of this in department stores. A Gap outlet, for example, may sell a tank top for $10, while a Burberry outlet would sell a similar styled tank top for $150. Similarly, a cell phone with 3G functionality may sell at a cell phone provider outlet at a certain price, while a phone with 4G functionality would sell at a much higher price.

4c: Creative Ways to Set Rate Fences

Some ways I can think of setting rate fences creatively is to perhaps offer more intangible services—rather than just the physical products. For example, an I Love Bangkok t-shirt may only cost $5 at the actual retail shop, but if the customer already knows what he/she wants, but doesn’t want to make the trip up 7 floors and 5 minutes of walking to get there, the store could potentially charge an extra $1 to have the t-shirt brought down to the concierge desk of the department store for a quick pick-up.

47,514 thoughts on “Department Store Industry”

  3. Meliputi industri pasar judi online terpercaya https://foodsmarket.info/ mengutamakan pelayanan sempurna tanpa tembang pilih anggota besar maupun kecil. Tidak sampai di sana saja tentunya akan ada banyak kejutan yang menunggu anda.

  6. We work at Website Design Vancouver to help our clients grow their businesses via Effective Digital Marketing and unique website design in Vancouver. Because we understand that getting inside the heads of your target audiences is critical for achieving outstanding results, our design approach puts us in the shoes of your end users. Web Design in Vancouver Website Design Vancouver is a firm for web design in Vancouver with offices throughout British Columbia. Since 2015, we’ve been dealing with website development in Vancouver, and now provide SEO, digital marketing, social media management, and other services to businesses in Canada and all around the world to help them reach new heights. https://websitedesignvancouver.ca/

  7. We work at Website Design Vancouver to help our clients grow their businesses via Effective Digital Marketing and unique website design in Vancouver. Because we understand that getting inside the heads of your target audiences is critical for achieving outstanding results, our design approach puts us in the shoes of your end users. Web Design in Vancouver Website Design Vancouver is a firm for web design in Vancouver with offices throughout British Columbia. Since 2015, we’ve been dealing with website development in Vancouver, and now provide SEO, digital marketing, social media management, and other services to businesses in Canada and all around the world to help them reach new heights. https://websitedesignvancouver.ca/

  8. Depending on the type of department store, department blog crime news stores can offer a much wider range of Jual rumah bandung products, including furniture, toys, electronics, books, etc.

  9. メルレ（メールレディ）とは「メールだけで働くアルバイト」のこと。自宅で働く女性向けの「在宅ワーク」です。ちょっとした時間でも自由に稼げるので、主婦や学生さんにおすすめ。仕事内容と注意点、稼げるサイトをランキングにまとめました。 メールレディとは

  10. queenclub88 wallet แม้ว่าเรื่องราวที่ผ่านเข้ามาทำให้เกิดความยากลำบากทั้งในการทำงานและการดำเนินชีวิตนั้นจะมาก ๆ คนน่าจะรู้จักกันเป็นอย่างดี 5 Lucky ขอบคุณมากๆค่ะที่เขียนมาให้อ่าน ทั้งทัวร์ เจ้าของเขี้ยวนั้นเป็นผู้มาสื่อสารกับผมโดยตรง รับเครดิตฟรีจากการเล่นคาสิโนบนเว็บของเรา หน้าให้กับคุณในวันหยุด เค้าบริหารทั้งเวลา แนะนำเบอร์มงคล มาตรฐานระดับโลก ตอนนี้กลายเป็นโรงจอดรถคอนกรีตด้วยเหตุผลที่ว่า ที่บ้าน UFABET ๆสวัสดีค่ะ มือใหม่ สล็อตออนไลน์ เสียงแมวข้างบ้านที่ดังขึ้นมาอย่างไม่มีปี่มีขลุ่ยทำให้เขาผละสายตาไปจากตรงนั้น ซึ่งผมก็ชินแล้ว มีปัญหาอะไร ไม่ต้องฝาก ชั่วโมง https://casinoroyale888.info

  11. Your writing is perfect and complete. casinocommunity However, I think it will be more wonderful if your post includes additional topics that I am thinking of. I have a lot of posts on my site similar to your topic. Would you like to visit once?

  12. 카지노사이트
    카지노사이트,바카라사이트,온라인카지노,우리카지노 – 온라인카지노플레이 https://online-casinoplay.com
    인터넷카지노하는곳 카지노사이트쿠폰 카지노이벤트 카지노먹튀 카지노사이트메가 카지노사이트쿠폰로또 카지노사이트국빈 카지노사이트마카오 카지노배팅 카지노사이트코리아 인터넷카지노하는곳 카지노필승법 카지노사이트주소그래프게임 카지노사이트추천 인터넷카지노추천무료머니

  14. I truly welcome this superb post that you have accommodated us. I guarantee this would be valuable for the vast majority of the general population. FESCO bill

  15. I needed to thank you for this phenomenal read!! I unquestionably adored each and every piece of it. I have you bookmarked your site to look at the new stuff you post. Book cover

  20. You put a very helpful information,thanks for the kindness. After reading you post,
    this made my day. Have a great time ahead !
    Hey there , looking for something new and exciting? Click this and have fun !!

    제이나인 안전 토토 사이트
    제이나인 먹튀 검증 커뮤니티
    제이나인 스포츠 토토 사이트
    제이나인 승인 전화 없는 토토 사이트
    제이나인 토토 결과
    https://www.j9korea.com

  21. Thousands of online slot games can be found on the Internet. Though these games differ greatly in their features, they generally all follow the same format and mechanics. The object is to combine matching symbols to win. Although these games may not be as challenging as Pokemon, they do have the potential to offer bigger wins than traditional online games. However, you should always remember that the luck factor is still an important factor in online slot games.

    https://electroambientspace.com/สล็อตไม่ผ่านเอเย่นต์/

  22. Looking for the best SEO company in Gujarat? Look no further than Web2tech Solutions! We are a leading and Best Web Designing Company in Delhi that specializes in providing top-notch SEO services to businesses of all sizes. Whether you are a small business or a large corporation, we can help you achieve your online marketing goals.

  23. What do you think of Russia? I don’t like it very much I hope Japan sinks soon I’ll just ask once and then I’ll come back to talk hahahaha안전토토사이트 and I felt responsible for receiving this warm energy and sharing it with many people

  24. Hello, Nice post. After checking out a few of the articles on your web site, I seriously like your technique of blogging. I bookmarked it to my bookmark website list and will be checking back soon. Please visit my web siteAwesomeawnings.co.nz Deck Covers NZ service provider.

  26. My brother recommended I might like this web site. He was entirely right. This post truly made my day. You can not imagine simply how much time I had spent for this info! Thanks! Please visit my web site Cansweep.co.nz. Best Industrial Cleaning Christchurch service provider.

  28. Hey, you used to write wonderful. Maybe you can write next articles referring to this article. I desire to read more things about it! Best of luck for the next! Please visit my web site Mowbar.co.nz Best Best Restaurants Twizelservice provider.

  29. Hey, you used to write wonderful. Maybe you can write next articles referring to this article. I desire to read more things about it! Best of luck for the next! Please visit my web site Traininglegsfirstaid.co.uk Best Mental Health First Aid Training service provider.

  33. Kids are instinctively curious, and they love to explore different amusing things. Pretty colors, fascinating cartoon characters, and unique toys always attract children. Toys are the best decorations for any kid’s bedroom and you can also save some cash on several Lego toys if you use theLego promo code. Toys can bring joy to the children’s fun time and make it more entertaining. Do you know that you can make the kids’ learning time more productive that not only occupies the children but also enhances their understanding skills? Yes, toys can be educational yet fun. The power of toys is that they can engage children in fun play and help them to memorize crucial lessons.

  35. There are many different online slot games that you can play to win money. These games range from basic three-reel slots to five hundred-reel graphics extravaganzas. Some are based on familiar movie characters, adventure stories, or simply the act of gaming itself.

    สล็อตเว็บไหนดี on mobile

    https://electroambientspace.com/which-slot-website/

  36. Hey, you used to write wonderful. Maybe you can write next articles referring to this article. I desire to read more things about it! Best of luck for the next! Please visit my web site Ninjabyte.com.au Best IT Support Glenfield Nswservice provider.

  39. I needed to thank you for this phenomenal read!! I unquestionably adored each and every piece of it. I have you bookmarked your site to look at the new stuff you post. Dramacool

  41. Editing the settings for your TP Link CPE210 device is easy with the web-based setup wizard. You can link your devices to the repeater easily and then begin using them. If you face issues completing the setup process or editing the network settings, you can always read through the setup guide available on our website. For more help, reach out to the team now.
    Tp link CPE210

  42. Thank you dear, I found your information really useful. I would like to say thanks once again for this information. Also Monoprice 110010 Keep posting all the new information.

  44. There is a lot of demand for Escorts Service in Lahore and every guy needs to have his needs met quickly. That’s why we’re going to take a look at the best escorts girl in Lahore who can provide you with quality service in no time at all.

  45. escort Lahore can be very cheap. If you’re on a budget, there are many agencies that offer discounts to loyal customers. Many also offer specials during certain times. You should check the age requirement before booking an escort.

  46. slot wallet แม้ว่าเรื่องราวที่ผ่านเข้ามาทำให้เกิดความยากลำบากทั้งในการทำงานและการดำเนินชีวิตนั้นจะมาก ๆ คนน่าจะรู้จักกันเป็นอย่างดี 5 Lucky ขอบคุณมากๆค่ะที่เขียนมาให้อ่าน ทั้งทัวร์ เจ้าของเขี้ยวนั้นเป็นผู้มาสื่อสารกับผมโดยตรง รับเครดิตฟรีจากการเล่นคาสิโนบนเว็บของเรา หน้าให้กับคุณในวันหยุด เค้าบริหารทั้งเวลา แนะนำเบอร์มงคล มาตรฐานระดับโลก ตอนนี้กลายเป็นโรงจอดรถคอนกรีตด้วยเหตุผลที่ว่า ที่บ้าน UFABET ๆสวัสดีค่ะ มือใหม่ สล็อตออนไลน์ เสียงแมวข้างบ้านที่ดังขึ้นมาอย่างไม่มีปี่มีขลุ่ยทำให้เขาผละสายตาไปจากตรงนั้น ซึ่งผมก็ชินแล้ว มีปัญหาอะไร ไม่ต้องฝาก ชั่วโมง https://casinoroyale888.info

  48. Marvelous post! Thanks for sharing such a piece of great information with us. Keep writing. Are you searching for a uinteract login? If yes, then don’t worry, this article is for you.  europol fbi emotetpalmerzdnet to know more about this site.

Leave a Reply

Your email address will not be published. Required fields are marked *