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.

45,448 thoughts on “Department Store Industry”

  5. Whats up very nice website!! Man .. Beautiful .. Wonderful .. I will bookmark your site and take the feeds additionally…I’m glad to find a lot of helpful info right here in the post, we need work out extra techniques in this regard, thank you for sharing. 총판모집

  11. 开云体育（KAIYUN SPORTS）是全球最大的在线综合性娱乐平台，开云在赞助和服务覆盖方面遥遥领先于其他同行，每天为您提供近千场精彩体育赛事。 更有开云真人、开云棋牌、开云彩票、开云电竞、开云百家乐、开云电子、全球各地赛事、动画直播、视频直播等服务。请点击下面注册入口进行查看, 每日每场皆有奖，福利惊喜不停。- Website: https://kaiyun-sports.cc/

  12. 开云体育（KAIYUN SPORTS）是全球最大的在线综合性娱乐平台，开云在赞助和服务覆盖方面遥遥领先于其他同行，每天为您提供近千场精彩体育赛事。 更有开云真人、开云棋牌、开云彩票、开云电竞、开云百家乐、开云电子、全球各地赛事、动画直播、视频直播等服务。请点击下面注册入口进行查看, 每日每场皆有奖，福利惊喜不停。
    Website: https://kaiyun-sports.cc/

  13. MK体育（MK SPORTS）每天为您提供近千场精彩体育赛事，还有真人娱乐、棋牌游戏、彩票购注、电子竞技和全球各地的赛事。我们还提供动画直播和视频直播，带给您全方位的观赛体验。MK体育邀您每日观看2024年五大联赛，领取豪礼，每场比赛都有奖品等待您。请点击下面的注册入口查看详情，享受不停的福利。参加活动充100送100.

  14. We have practiced many massage therapies since our founding in 2008, backed by our extensive knowledge in the science and art of traditional body massage.

  15. MK体育（MK SPORTS）每天为您提供近千场精彩体育赛事，还有真人娱乐、棋牌游戏、彩票购注、电子竞技和全球各地的赛事。我们还提供动画直播和视频直播，带给您全方位的观赛体验。MK体育邀您每日观看2024年五大联赛，领取豪礼，每场比赛都有奖品等待您。请点击下面的注册入口查看详情，享受不停的福利。参加活动充100送100.

  16. This analysis of the department store industry’s evolution is both insightful and thought-provoking. It’s fascinating to see how traditional retail giants have had to adapt in the face of digital transformation and shifting consumer preferences. The emphasis on experiential shopping and the integration of online and offline experiences are indeed pivotal for the survival of department stores in today’s market. I appreciate how the article breaks down the various strategies that stores are employing to stay relevant, from enhancing customer service to leveraging data analytics for personalized marketing. As someone interested in retail trends, this piece provides a comprehensive overview of the challenges and innovative solutions within the industry. Kudos to the author for shedding light on these critical dynamics!
    —————————————————————————————————————–
    Corporate gifts Qatar

  18. 7m hiện đang nằm trong danh sách những chuyên trang cung cấp dữ liệu tỷ số bóng đá chất lượng cao trên thị trường. Ngay khi click vào website, người dùng sẽ được trải nghiệm một loạt các chuyên mục sôi động cùng ưu điểm hấp dẫn như: Thông tin tỷ số 200+ trận đấu và xem lịch thi đấu, bảng xếp hạng, kết quả bóng đá từ nhiều nguồn uy tín mỗi ngày.

  20. Привіт всім! Хочу поділитися своїм досвідом щодо біотину для волосся. Я вже тривалий час шукав ефективний засіб для зміцнення волосся, і нарешті знайшов його! Біотин справді творить дива. Після кількох тижнів використання я помітив, що волосся стало значно густішим і міцнішим, перестало випадати та виглядає здоровішим. Якщо ви також хочете покращити стан свого волосся, раджу купити біотин для волосся в Україні на сайті ось силка . Там великий вибір якісних вітамінів і швидка доставка. Дуже задоволений своїм вибором і впевнений, що ви теж будете раді результату!

  21. Hello! I just would like to give a huge thumbs up for the nice information you have here on this post. I can be coming again to your blog for more soon. onehoki

  22. تقوم شركه كشف تسربات المياه بالرياض بعمل فحص شامل لجميع صنابير المياه والأنابيب والخزانات، كما أن الشركة تقوم بتقديم عروض وتخفيض

    القي نظرة خفيفة على الموقع :
    https://maps.app.goo.gl/2mgrBZ1i48ZDJmDZ8

  24. Many thanks spending some time to discuss this important, I find myself really do onto it and furthermore enjoy looking over read more about doing this idea. Whenever capabilities, simply because pull off skills, might you imagination bringing up-to-date a internet page by using extra info? This is a good choice for people. filter coffee machine

  25. There couple of interesting points over time here but I don’t determine if them all center to heart. You can find some validity but Let me take hold opinion until I investigate it further. Very good post , thanks and now we want a lot more! Put into FeedBurner also leather harnesses in berlin

  26. In the bustling city of Noida, the underbelly of nightlife reveals a complex and controversial industry russian call girls in Noida. Among various players in this domain, the “Miss Parveen Team” has gained notoriety, particularly for providing Russian call girls. This article delves into the nuances of this clandestine industry, examining its operations, societal implications, and the overarching legal landscape. Follow this link https://missparveen.com/escorts-service-in-noida-delhi/

  27. In conclusion, escorts in Lahore offer a unique and professional companionship service that is tailored to meet the diverse needs and preferences of their clients.
    Escorts Lahore

  28. With the charming models of our high class escort agency, you will enjoy every moment of your date. We are a premier https://cavalli-escort.com/ that differentiates itself by offering professional and client-centric escort services.

  32. عندما تتعطل غسالتك الموثوقة، قد يكون ذلك تجربة محبطة وفوضوية، خاصة في مدينة ساخنة ومزدحمة مثل الكويت. تتراكم الملابس المحركة، ولهذا السبب يجب غسل الملابس بشكل جماعي. لكن لا تخف، وبالتالي فنيون ماهرون في إصلاح الغسالات في الكويت يمكنهم المساعدة. ومن خلال خبرتهم ومعرفتهم العلامة التجارية والنماذج، يمكنهم تشخيص المشكلة المساهمة بحل سريع وفعال. سواء كانت مضخة تصريف معيبة، أو منظم حرارة معطل، أو حزام قصير مهترئ، فإن هؤلاء الفنيين لديهم المعرفة اللازمة للمشكلة البسيطةها، وتشغيل غسالتك وتشغيلها في وقت. يمكنهم أيضًا تقديم نصائح لتجديد الأعجوبة المستقبلية، مما يضمن استمرارهم في العمل والتبعية. بفضل خدمتهم السريعة والموثوقة، يمكنك أن تقول وداعا لمشاكل الغسيل وترحب بملابس جديدة مرة أخرى.
    https://www.ghsalat.com/

  33. وعندما تتعطل غسالتك الموثوقة فجأة في وسط يوم الغسيل، يمكن أن يكون ذلك جاهزًا للإحباط بشكل كبير، خاصة في مدينة لتكون مثل الكويت حيث الحياة السريعة المشاركة بالفعل. لكن لا تخف، ففني إصلاح الغسالات الموثوقة به بعد مكالمة هاتفية منك فقط! شاملة لهم الخبراء ومعرفتهم الشاملة وشاملة العلامات وموديلات الغسالات، ويمكنهم تشخيص المشكلة وتشغيلها في الوقت المناسب. من مضخات التصريف المعينة إلى دورة المتسابقة، رأى هؤلاء الفنيون في كل شيء ويمكنهم إصلاحها أو استبدالها فورا فورا لغسل الملابس إلى المسار الصحيح. من خلال اختيار خدمة إصلاح الغسالات ذات السمعة الطيبة والخبرة في الكويت، يمكنك الاطمئنان إلى أن نظامك سوف يعوده إلى مجده السابق، وسوف تعود بملابس جديدة وتربح في وقت قصير.
    https://www.ghsalat.com/

  34. عندما تتعطل غسالتك الموثوقة، قد يكون ذلك تجربة محبطة وغير مريحة، خاصة في المناخ الساخن والرطب مثل الكويت. لكن لا تخف، وبالتالي فنيون ماهرون في إصلاح الغسالات في الكويت يمكنهم المساعدة. بفضل خبرتهم ومعرفتهم، يمكنهم تشخيص مجموعة واسعة من المشكلات، ويفضلون من مضخات التصريف المعيبة وحتى لوحات التحكم المعيادة. سواء كنت متواجدًا في مدينة الكويت المزدحمة أو في مدينة أصغر مثل الفحيحيل، ويمكن لهؤلاء الفنيين الوصول إلى عتبة الآلاف، ويتوفرون بالأدوات وقطع الغيار اللازمة، لتشغيل غسالتك وتشغيلها مرة أخرى. بفضل خدمتهم السريعة والفعالة، يمكنك الاطمئنان إلى غسل ملابسك بشكل أسرع مرة أخرى في الوقت المناسب.
    https://www.ghsalat.com/

  36. عندما تتعطل غسالتك الموثوقة، مما يتركك مع كومة من الغسيل المتين والذعر، فمن المؤكد معرفة أن هناك فني إصلاح غسالات موثوق به ومهرة في الكويت يمكنهم الحماية. يتميز هؤلاء الخبراء بمعرفة مستجيبة المتغيرات الغسالات ويستطيعون لتشخيص مجموعة واسعة من المشكلات، ويستطيعون من الحث على المعيبة والإشعارات البالية وحتى التحكم الإلكتروني والتسرب المتسرب. بفضل خدمتهم السريعة والفعالة، يمكنك الاطمئنان إلى أن غسالتك ستعود للعمل في وقت قصير، مما يوفر لك كل ما تحتاجه ونفقات على الاضطرار لشراء واحدة جديدة. بالإضافة إلى ذلك، يقدم العديد من الفنيين الإصلاحيين في الكويت جدولًا مرنًا وأأسعارًا للعمل، مما يجعل إصلاح غسالتك أكثر بسرعة وبتكلفة معقولة.
    https://www.ghsalat.com/

  39. In the realm of online games, the concept of a 7inr presents an intriguing proposition. With just 7 Indian Rupees, players have the opportunity to partake in various Online games, albeit on a modest scale. While it may seem like a small amount, it can still provide entertainment and a chance to win prizes.

  41. Hello my dear friends, my name is Pinky i am a free independent escort service in islamabad location but now I am live in islamabad, I am student, I have work this link because i need the money for my self.

  45. Great – I should certainly pronounce, impressed with your website. I had no trouble navigating through all the tabs as well as related info ended up being truly simple to do to access. I recently found what I hoped for before you know it at all. Quite unusual. Is likely to appreciate it for those who add forums or anything, website theme . a tones way for your customer to communicate. Excellent task. Moduliniai namai kaina

  47. Alexistogel merupakan situs togel dan slot online terbesar yang menyediakan berbagai pasaran togel & ribuan game slot yang bisa kamu mainkan dengan 1 akun saja. link alexistogel

Leave a Reply

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