Department-store landmarks give way in big merger

Circa 1957: A woman and her young daughter enter Jordan Marsh in Boston, or maybe Higbee's in Cleveland or Marshall Field's in Chicago.

As they go through the store, unctuous salesmen greet them from behind glass cases filled with suede gloves and silk stockings. Madam's change will arrive in a tube from the second floor. After eating lunch at the store, the two will buy a box of Frango Mints if it's Chicago, or blueberry muffins in Boston.

Today, Mom probably shops at Wal-Mart, where cheap wool gloves are piled on tables. If she and her daughter don't want to leave their house, they can shop online. Even if they want to go to the mall or a department store, they will wait until there is a sale.

All these changes have caught up to the traditional department store - those multifloor retailers that try to offer consumers everything from pots and pans to $2,950 TAG Heuer watches. To stay alive, they are starting to merge. This week's $11 billion linkup between Federated and May Department Stores is symbolic of the changes in the way Americans buy what they need. Americans are increasingly pressed for time and can no longer devote hours to the large stores. They are also less concerned with quality since it costs less to replace products that wear out. And they are less concerned with personal service.

"At the end, it is the consumer who is making this happen. They are voting with their dollars," says Jay MacIntosh, director of retail and consumer products at Ernst & Young, the accounting firm.

There are scores of retailers who can attest to these changes. Gone are B. Altman & Co.; the Broadway; Woodward & Lothrop; and Montgomery Ward. In 1995, Wanamaker's, which just about started the US department store phenomenon with its Oak Hall Clothing Bazaar in 1876, closed its doors for good.

The changing retail landscape was evident outside a Wal-Mart in Guilford, Conn., this week.

Susan Nichols and her daughter Lindsey were heading in to exchange a "Star Wars" light saber for a different model. Ms. Nichols says that when she was young she did shop at traditional department stores regularly, but she rarely does now.

"Basically, I shop pretty much at Wal-Mart. It's close, and prices are competitive. The department stores are further away, and they offer less variety and are more expensive," she says. "Obviously, sometimes quality is more important than the price that you pay, but if you're looking for something disposable, you don't want to spend a lot of money."

For other shoppers, like Lillian Roth from Madison, Conn., quality is more important than price. But she shops at Wal-Mart because it's close, even though she'd prefer to shop at a traditional department store.

"The only reason you come to Wal-Mart is if you want to grab up something quick and you want to save a few pennies," she says. "There's no Macy's around here. You have to go far away to get to one."

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