I followed the Federated Department Stores and R.H. Macy's & Co. deal as if I owned shares and held a seat on the board. I did the same when the Proffitt's/Saks Fifth Avenue merger came to pass. It was the latter that called to mind the prediction of a futurist some years ago: By the year 2000, five to seven major corporate retail giants will exist. Today, that prediction is not too far from the reality.
The department store sector is not alone. While mergers and acquisitions have loomed large in that arena, Chapter 11 filings and store closings have been the results for others including mass-market and specialty stores. Some emerged; some didn't; some didn't even try. Remember Caldor? Bradlees?
Doesn't it seem ages ago? That's because we've just become accustomed to a shrinking retail environment that translates to less real estate on the selling floor.
Among those who did survive, the changes within those organizations resulted in a sea of sameness across many distribution channels. To combat this, some major retailers either launched their own private-label "brands" or rejuvenated them; others opted for exclusives. This was all in an effort to spark lagging sales, gain customer and brand loyalty, and drive traffic.
Then price slashing. Can't compete on a product level, compete on a price level. Sound like a vicious cycle? It is.
So, what should so many of these retailers do? The answers are so simple. Finding a point of difference-one that separates you from the competition-is key. Whether it's your customer service, merchandise assortment, merchandising tactics, promotions, or incentives.
Such is the task at hand for Kmart. How should this retailer serve a time-stressed, product-starved consumer, who shops all tiers of distribution, basing some judgments on price, others on value, and still others on brand loyalty? This is the question (as well as others) that we put to several professionals in the licensing business. Essentially, if you owned Kmart…what would you do to maintain your position as a leading discounter? How would you set yourself apart from the competition? See page 32.
At License!, we think along the same lines. As the official publication of the Licensing 2002 International Show, this month you'll find an Official Show Preview, complete with exhibitor listings, floor plan, exhibitor property launch previews, what retailers want and expect from this year's show, and a restaurant guide. This special section, compiled by the editors of License!, opens with a letter from Diane Stone, general manager, Advanstar Global Licensing Group. This Official Show Preview is meant to serve as a time-effective and time-productive tool for visitors attending the upcoming show.
Questions? Comments? Future story ideas? Contact me via e-mail or at (212) 951-6707.