DEPARTMENT STORES have their roots in the New York City business arena of the industrial era. Their success in the mid-nineteenth century created such retailing giants as Macy's, Gimbels, Marshall Field's in Chicago, and Neiman-Marcus in Dallas. Department stores indirectly paved the way for department/mail-order stores, smaller department/chain stores, and late-twentieth-century mass merchandising department/discount stores like Wal-Mart. The story of department store shopping is one that seemingly forever will be bound up in the transportation and travel patterns of Americans. At the beginning of the nineteenth century, subsistence growing and local handwork were the anchors of American buying. The limitations of foot travel or horse-drawn travel necessitated such an economy. Farmers grew what their families needed as well as what they could sell from the back of a wagon to people in nearby towns. In addition, handicraft artisans sold items such as furniture, candles, or tack to locals. Transportation advances began to change that economy. River travel by steamboat became practical after 1810; canal travel after 1825; rail travel after about 1832 in the East and from coast to coast after 1869 when work crews completed the Transcontinental Railroad.
Until the Industrial Revolution, however, production could not effectively utilize the potential of new transportation. Interchangeable parts, assembly line techniques, vertical integration of businesses, and urban industrialized centers made production of virtually all goods quicker and more cost efficient, allowing manufacturers to capitalize on transportation.
Yet merchandising outlets for mass-produced goods lagged behind the capabilities of industrialized production and transportation. Producers discovered that, without sufficient retail outlets, a large percentage of their goods could quickly become surplus, eating away at their bottom line. Industrialization also enabled companies to produce new goods that the buying public had never encountered and for which it had no need or desire. Wholesalers and brokers had already worked the agricultural produce system, taking grain and vegetables from farms to markets and profiting in the process. They were prepared to do the same for manufactured goods, but the cycle begged for some type of marketing or retail system to marry goods to consumers.
A new type of store filled the bill. City stores and shops specialized in specific goods, such as clothing or cookware. General stores had small offerings of a variety of goods, but neither could exploit what industrialized production and transportation could supply. Department stores could. From the beginning, department stores were large. Inside, owners divided them into "departments" which contained similar types of goods.
Although not the most famous of storeowners, Alexander Turney Stewart is the father of the American department store. An immigrant Irish schoolteacher, Stewart opened a small dry-goods store in New York in 1823. He prospered well enough to open a second store, Marble Dry Goods in 1848. In 1862 he built the huge Cast Iron Palace that claimed an entire city block and was the largest retail store in the world at the time.
Aside from creating the department store, Stewart started the practice of "no haggle" shopping. Haggling, the practice of buyers and sellers negotiating a price acceptable to both, was a tradition in American shopping. But Stewart saw that salesmen could conduct more business without the obstacle of haggling, and he also perceived that many shoppers did not like the haggling ritual. Instead, he settled on a price he could accept for every product he sold, then he marked the product with that price. His customers were free to pay the price or shop elsewhere. With little exception, they liked the policy and Stewart made millions of dollars.
The Philadelphia merchant John Wanamaker, as did all other department store pioneers, adopted Stewart's "one-price" policy, but he took it a step farther. Wanamaker, who first partnered with Nathan Brown in 1861, then worked alone after Brown's death in 1868, offered customers a "satisfaction guaranteed" policy that he backed with the promise of exchanges or refunds. While other merchants followed suit, Wanamaker was one of the first merchants to run a full-page ad in newspapers, and his endless advertising associated him most with the satisfaction pledge, something he called "the Golden Rule of business." Wanamaker branched out with stores in Pittsburgh, Memphis, St. Louis, Baltimore, Richmond, and Louisville. Ultimately he expanded into New York City, setting up business in one of Alexander Stewart's old stores.
Today, neither Stewart nor Wanamaker is a household name. R. H. Macy is. Rowland H. Macy founded the famous New York City department store that is known to most Americans as the annual sponsor of the Macy's Thanksgiving Day Parade and also because it is the scene of much of the story in the classic Christmas movie Miracle on 34th Street. The Macy's name is synonymous with American department stores.
R. H. Macy opened his first store—a sewing supply store—in Boston in 1844. He followed that with a dry goods store in 1846. Like thousands of other Americans, Macy followed the gold rush to California in 1849–1850. Unlike most of them, however, he did not mine for gold, but instead opened another store. In that Macy showed savvy, for most argonauts remained poor; those who serviced them did markedly better.
By 1851, Macy had returned to Haverhill, Massachusetts, where he opened the Haverhill Cheap Store, advertising a one-price policy. By 1858, Macy had moved to New York City, opening a dry goods store uptown. His business was remarkable, doing more than $85,000 in sales the first year. That same year Macy inaugurated the practice of setting up beautiful, fanciful toy displays in his store windows at Christmas.
Macy started buying up adjacent properties to expand his business. He also leased departments inside his store to outside retailers, which served to increase customer traffic. His sales volume enabled him to undercut other department stores, and he advertised the lowest prices of any store in the city. Macy entered mail-order sales in 1861. He inaugurated the now-traditional policy of clearance sales to liquidate merchandise and bolster cash flow. He also offered free delivery to nearby New York City boroughs.
Macy died in 1877, and management of the store passed through various hands until Isidor and Nathan Straus, friends who had previously leased a china concession inside Macy's, took over the management and ultimately bought controlling stock in Macy's. Later Macy's would become part of the Federated Department Store group.
Gimbel's was another famous New York City department store. Bavarian immigrant Adam Gimbel began his business career on the American frontier, establishing a trading post at Vincennes, Indiana, in 1842. There he brought the one-price policy to westerners. Gimbel prospered and opened stores in Milwaukee and Philadelphia. In 1910, Gimbel's son, Isaac, opened a store in New York City that successfully competed with Macy's. The Gimbel family later acquired the Saks company and, with Horace Saks, opened Saks Fifth Avenue for more affluent customers in 1924.
Department stores with one-price policies and satisfaction guarantees opened in urban areas across the nation. One of the most successful outside of New York City was Marshall Field's in Chicago. Marshall Field was a
young businessman working in Chicago in the late 1850s at the same time as businessman Potter Palmer was parlaying a dry goods store into a lucrative business and real-estate holding. In 1865, Palmer took in Field and Field's friend Levi Leiter to form Field, Leiter, and Palmer. By 1868, Field and Leiter bought out Palmer, then rented business space from him on State Street in Chicago. The pair survived the devastating Chicago Fire of 1871, but parted ways a decade later. Field bought out Leiter, and he formed Marshall Field and Company.
Field directed the store to annual profits of more than $4 million. Part of Field's success was that he practiced two policies that became the credo of American businessmen. First, "give the lady what she wants"; second, "the customer is always right." Field brought up John G. Shedd and Harry G. Selfridge, two former stock boys, to help with management. Shedd directed the store's change from a dry goods store to a department store like Macy's in New York. He became president of Marshall Field's after Field's death in 1906.
Department stores have always had to identify their niche with the public. Some, like Macy's, catered to all classes. Others, like Saks Fifth Avenue, appealed to a more elite clientele. One Dallas department store has always catered to customers with exotic tastes. In 1907, Herbert Marcus and his brother-in-law A. L. Neiman opened Neiman-Marcus with the intent of bringing the finest goods to customers in the West. While Neiman-Marcus was in some ways a traditional department store like Macy's, it always had a flair for the flamboyant. Nowhere but Neiman-Marcus could customers buy submarines, robots, or airplanes. Neiman-Marcus established a reputation, as Dallas citizens might say, "as big as Texas."
As the twentieth century progressed, some department stores consolidated into groups or "chains" for buying clout and protection from rival onslaught. Federated Department Stores formed in 1929 as a holding company for several department stores, such as Abraham & Straus and F&R Lazarus. For more than seventy years, Federated has offered the protection of consolidation to family-owned stores. It is one of the largest chains in the nation and includes such standards as Macy's and Bloomingdale's.
In big cities, department stores were seemingly unlimited in the products they could provide customers. But to many Americans—farmers in the Midwest, for example—those stores were out of reach. Some enterprising businessmen decided they would simply take the department store to the customer. While most department stores got into mail order at one time or another, none succeeded like Montgomery Ward, Sears and Roebuck, and J.C. Penney's.
The first man to capitalize on the mail order business was Aaron Montgomery Ward, a former salesman for Marshall Field's. In 1872 he began a mail order business, catering chiefly to Grangers at first. Grangers, or officially the Patrons of Husbandry, were groups of Midwestern farmers organized to protest the exorbitant freight and storage rates of railroads. They also protested the high mark-ups of goods at general stores, which, by location they were almost bound to patronize. Montgomery Ward capitalized on that Granger frustration and devoted itself to serving American agrarians at prices less than the general store. One of Ward's first catalogs, in fact, offered buyers an official Granger hat, a tall-crowned affair made of "all wool" and costing $1.25.
Of course, Wards could not have succeeded without the famous catalog. Its first issues were only four-to-six pages, crowded with pictures and price lists. Later issues were more organized. Ward updated them every year. It may have been to Ward's chagrin, or perhaps to his satisfaction that his business had made it another year, that out-of-date catalogs usually got relegated to the outhouse.
Montgomery Ward drew its chief competition from Sears, Roebuck and Company. By the mid-1890s, Richard W. Sears had teamed with Alva C. Roebuck to create Sears, Roebuck and Co. Sears had begun a career selling watches in 1886, but by 1895 he and Roebuck were making a lucrative living through catalog sales. Through diligent warehouse organization (which Sears hired out) and the establishment of regional fulfillment houses, Sears, Roebuck and Co. could promise quick turnaround on orders.
Perhaps more so than the Wards catalog, the Sears catalog, which by 1897 was running at more than 500 pages, became an American icon. Americans came to know it as the "Wish Book." From its pages customers could buy hammers and nails, dresses, hats, corsets, pots and pans, soaps, rugs. They could even buy—by ordering component parts and assembling them on site—a complete house with indoor plumbing.
Both Sears and Ward fared well through World War I, but the 1920s brought a new phenomenon. Just as Henry Ford's mass production of automobiles revolutionized freeway systems and suburban living, it impacted catalog sales as well. The catalog giants discovered that the automobile freed rural Americans from the nearby country store. On weekends they could drive to cities and partake of the big department stores, which was infinitely more exciting than leafing through catalogs. Almost simultaneously, both Montgomery Ward and Sears, Roebuck decided to get into the retail department store business and attract their share of urban trade. That business served as a complement to continued catalog sales.
Another catalog giant, J.C. Penney, entered mail-order sales in the reverse way. In 1902, with the backing of two silent partners, James Cash Penney opened a dry goods and general store in the mining town of Kemmerer, Wyoming. Penney was the son of a Baptist preacher, and he practiced his religion through business. He called his store the "Golden Rule" store (photos of which grace almost any modern Penney's store), and he offered fair prices, good service, and late store hours. He immediately made a profit, which enabled him to open more stores in the next few years. In actuality, J.C. Penney became one of the first multi-store companies, totaling 1,600 stores by 1950. Larger Penney's department stores became mall anchors, and in the 1960s began to draw fire from such companies as Dillards, Brown-Dunkin, now simply Dillards. J.C. Penney lived until 1971. He saw the company's move into catalog sales in the preceding decades. Ironically, at the turn of the twenty-first century Sears is out of the catalog business and Montgomery Ward is out of business altogether, leaving J.C. Penney as the major American catalog retailer.
Chain stores are the little siblings to big department stores. While in fact they contain departments, they are usually located on one level and are much smaller than urban multi-floor department stores. As such the U.S. Census bureau does not officially recognize them as department stores. Their rise, however, has impacted traditional department stores.
The grandfather of American chain stores was Frank W. Woolworth. In 1878, while clerking in the Watertown, New York, store of Moore and Smith, Woolworth learned the value of selling special goods at five cents or less. With money borrowed from one of his employers, Woolworth opened his own five-cent store, and made more than $200 profit before closing it. He periodically opened and closed stores, amassing a personal wealth of more than $2,000. In the process he realized that customers would also buy "more expensive" items for ten cents. Thus Woolworth created the purely American "five-and-dime" stores.
By 1895, Woolworth had more than twenty-five stores garnering more than $1 million in annual sales. Realizing the potential of five-and-dimes, other stores followed suit: Kress, Kresge, T.G.&Y., and Ben Franklin to name a few. Most of those stores, however, were regional. Only Woolworths had a national base and widespread recognition.
By the 1960s, with suburbia rapidly eclipsing established cities, malls were becoming the fashionable place to shop. And few malls could survive without at least one full-fledged department store, a chain store, and a five-and-dime to anchor them down. But, like early department stores, malls were the provinces of large cities. Retailers soon saw a need for mid-range, hybrid stores that blended the departmentalization and variety of department stores, the accessibility of chain stores, and the relative value of five-and-dimes. Into that void stepped discount stores, direct forerunners of the superstores of the 1990s. Those stores include Kmart, the upscale Target, and Wal-Mart.
Wal-Mart originator Sam Walton got into the retail business in the 1950s, leasing a Ben Franklin store in Arkansas, making it turn a nice profit, then going into business for himself. Based on his experience working in five-and-dimes, Walton was able to negotiate good deals from producers by buying merchandise in bulk, then selling to customers at discount prices. Walton's target competition was Kmart, which had grown from the Kresge five-and-dimes. Walton opened his first Wal-Mart store in Rogers, Arkansas, in 1962. By 1985 he had 859 stores in twenty-two states. By the early 1990s, Wal-Mart was pioneering "supercenters"—extra-large stores that included full-size grocery stores, photography studios, McDonald's franchises, hair salons, and other specialty shops. Sales clerks and shift managers frequently got around the huge stores on in-line skates. In an unusual social phenomenon, Wal-Mart stores, with their toy aisles, arcade rooms, and fast food shops, became substitute amusement parks for millions of kids in rural America.
Walton died in 1992, but his chain continued to grow. By 1998 Wal-Mart boasted more than 3,000 stores in the United States, Canada, South America, and Europe. Wal-Mart critics have charged that the discount/ department stores have caused the death of many small downtown areas by attracting business to peripheral locations. Some chambers of commerce have refused to let Wal-Mart open in their town unless it did so in or near downtown. Other critics have charged that Wal-Mart has marketed goods made by child labor in foreign sweat-shops, even as the store advertised its "Made in America" campaign.
Author Bob Ortega has said, however, that Wal-Mart's legacy runs deeper than a chamber of commerce fight. By targeting the bottom-line—both his own and the consumer's—Sam Walton revolutionized department/ chain-store style shopping. He had done nothing less than Henry Ford had when he married the assembly line with automobile production. Now all types of stores, from booksellers to video-rental stores, practice bulk buying, offering large selections and discount prices, all packaged in attractive, easily accessible stores. Wal-Mart stores have also forced traditional department stores to rethink marketing strategies to keep middle-class shoppers spending money in their stores and not at Wal-Mart.
Nevertheless, discount and discount/department stores have severely cut into the profits of traditional department stores. The fact that they are still centered in urban centers and rarely in the suburbs and even less frequently in rural areas has isolated department stores even in the age of the automobile. When department stores were novel and automobile travel special, a trip to the city was fun. Now, increased traffic in urban areas and consumers having less time to shop has contributed to the decline in the popularity of the department store as a destination. Customers report a preference for specialty stores, like Toys-R-Us or Barnes and Noble, and discount/department stores in strip shopping centers. They prefer to drive to a store, immediately get what they want, and leave, rather than face parking problems or a maze of poorly marked sales areas in department stores.
Department stores are responding, however. Some of the major companies are experimenting with centralized checkouts for customer convenience, better signage, and relocation of popular departments close to entrances. Sears has started focusing more on marketing the sale of tools and appliances, longtime strong sellers for the company, and less on clothes and soft goods. Other department stores have cornered higher-end brand names, especially in clothing, that are unavailable at discount supercenters.
Department stores began in the mid-nineteenth century when transportation enabled wholesalers and retailers to offer a wide variety of goods to urban buyers. Catalog sales did the same thing for isolated rural Americans. When individual transportation became widely available to all Americans in the 1920s, retail stores, even those built on catalog empires, had to find new ways to vie for business. In the 1960s and 1970s, Wal-Mart and Kmart brought a low-end, discount/department store alternative to middle America. Those supercenters offered busy shoppers an effective alternative to driving to department stores.
Federated Department Stores. Home page at http://www.federated-fds.com.
Groner, Alex, ed., The American Heritage History of American Business and Industry. New York: American Heritage, 1972.
Latham, Frank B. 1872–1972: A Century of Serving Consumers; The Story of Montgomery Ward. Chicago: Montgomery Ward, 1972.
Ortega, Bob. In Sam We Trust: The Untold Story of Sam Walton and How Wal-Mart Is Devouring America. New York: Times Business, 1998.
Plunkett-Powell, Karen. Remembering Woolworth's: A Nostalgic History of the World's Most Famous Five-and-Dime. New York: St. Martin's Press, 1999.
Trimble, Vance H. Sam Walton: The Inside Story of America's Richest Man. New York: Dutton, 1990.
Weil, Gordon L. Sears, Roebuck, U.S.A.: The Great American Catalog Store and How it Grew. New York: Stein and Day, 1977.
The birthplace of the department store was Paris. The Bon Marché opened in 1852, soon followed by Printemps (1865) and the Samaritaine (1869). Existing shops in the United States— Stewart in New York, Wanamaker in Philadelphia and Marshall Field in Chicago—adopted the format during the 1870s. The department store brought together a series of retail methods tested out in smaller European and American shops earlier in the century, for example, the proto-department stores in industrial cities in the north of Britain (Lancaster, chapter 1). The department store proper was distinctive from previous experiments in its scale, lavishness, and resonance with the society that spawned it. The early Parisian stores were hugely influential models for subsequent stores springing up all over the world. The history of the department store has been largely located in Western Europe and North America. The arrival of the format in East Asian cities such as Shanghai and Tokyo in the early twentieth century has been associated with westernization, but the stores were often locally owned and managed, creating complex issues surrounding their identity.
The conditions for the rise of the department store lay in late-eighteenth-and early-nineteenth-century industrialization and urbanization, which led to the growth of prosperous, urban, middle-class populations and the ready availability of mass-produced consumer goods, along with an increasingly sophisticated understanding of the pleasurable rather than merely utilitarian possibilities of consuming them. Important department stores were situated in urban centers, on principal shopping streets, working in conjunction with other shops, entertainment venues, and transport networks. However, well-heeled suburbs also had department stores in their high streets. By the late nineteenth century, considered the hey-day of the department store, these shops had become emblematic of metropolitan modernity and were famously made the backdrop of Émile Zola's novel The Ladies' Paradise.
The major department stores of each important city— for example, Harrods, Liberty's and Selfridges in London— quickly became urban landmarks and cultural institutions, cited in guide books as tourist attractions. During the early twentieth century, American stores took the lead as innovators, becoming increasingly influential on their European counterparts. During the interwar and early postwar periods, while alternative shopping sites were developing, fashion magazines such as Vogue show that the big department stores retained their central position within urban consumption practices in many cities. However, despite stores' attempts to address broader sections of the population, the opening of teen departments and the provision of new buildings, fundamental modernization of the format did not occur. The combined competition from the multiple store and alternative boutique in the urban high street and from the suburban shopping center and out-of-town mall led to a slow decline in the cultural and economic importance of the department
store from the 1960s, accelerating during the 1980s. There were several factors that increased a store's chances of survival: possession of an international reputation, such as that of Harrods, London; absorption into a larger group, such as the House of Fraser or the John Lewis Partnership; positioning on a major metropolitan shopping thoroughfare or as the anchor in a shopping center. The early twenty-first century has witnessed a revival of the metropolitan department store, connected with a renewed focus on luxury goods and designer fashion, prime examples being Selfridges and Liberty in London. The department store has proved to be enduring.
Stock Diversity and New Selling Methods
An important innovation of department stores was their wide variety of merchandise, breaching the boundaries of previously largely trade-specific shop-keeping. Many of the early department stores actually developed from smaller existing shops, most commonly drapers. They grew department by department, taking over neighboring properties to house the expanding businesses, until it was necessary to provide a new building or reface the existing ones to provide coherence. Department store pioneer William Whiteley famously boasted that he sold "everything from a pin to an elephant." The system worked on a basis of low margins and high turnover. The stores were certainly a place for the sale of mass-produced goods and have been associated with the rise of ready-to-wear clothing. However, most stores continued to provide traditional tailoring and drapery well into the twentieth century. The diversity of stock was matched by an array of amenities and entertainments, including banks, restaurants, travel agents, fashion shows and live music, and services such as free delivery and alteration of garments.
Store histories are entwined with those of their owning dynasties, who usually gave their name to their stores, for example, the Wertheims and Schockens in Germany and the Lewises in England. Stores often merged with or were taken over by other stores, for example, the evolving nature of Britain's House of Fraser described by Moss and Turton. The business was organized in a hierarchical, rational, and paternalistic manner. Strict control of the workforce was balanced with benefits such as health-care, pensions, and social clubs. Indeed during the early days many of the employees lived in the upper stories of the building. This practice faded out following several high profile, devastating fires caused by gas lighting and poor fire-proofing of buildings. The stores required vast staffs; for example, Harrods of London had 4,000 employees in 1914. For nineteenth-and early twentieth-century social commentators and novelists, the figure of the young female shop assistant symbolized the dubious respectability, moral ambiguity, and blurring of class boundaries they found so disturbing about the department store. However, until the interwar period, the majority of employees were actually male and lower middle class. Positions were sought after, although salaries were low.
Customers and a New Kind of Shopping
From the beginning, the department store was associated with bourgeois consumers. As Miller has argued, "The department store was … a bourgeois celebration, an expression of what its culture stood for and where it had come over the past century" (Miller, p. 3). It was also initially seen as the exclusive province of women. The stores' provision of basic amenities such as lavatories and refreshment rooms made a day trip to town newly accessible for suburban and provincial middle-class women, enabling them to take advantage of improved public transport networks. Early department store owners, such as William Whiteley of Bayswater in London, were vocal in their claims to make shopping in the city a safe and respectable activity for unchaperoned women (Rappa-port). However, they also attempted to exploit feminine desires using new ideas about consumer psychology.
The distinctiveness of the department store model lay as much in the presentation of shopping as a pleasurable leisure activity as with the nature or number of goods available. Previously, shopping models had largely favored counter service and the acknowledgment of an obligation to buy once the shop was entered. In the new stores, the role of the retail staff was redefined and a different kind of shopping was encouraged, characterized by window shopping and browsing through displays of goods with fixed and ticketed prices. These practices drew on the cultures of the international exhibitions that followed London's Great Exhibition of 1851. All this, it was believed, would encourage impulse buying.
During the early twentieth century, department stores began to cater to men with dedicated departments. In 1936 Simpson Piccadilly opened in London's West End, claiming to be the first department store entirely for men. The lower ground floor alone was designed to house a barber's shop, soda fountain, gun shop, shoe shop, chemists, florist, fishing shop, wine and spirit shop, luggage shop, snack bar, dog shop, sports shop, cigar and tobacconists, gift shop, saddlery shop, theater agent, and travel agent. During the opening months the aviation department even exhibited full-sized airplanes. The opening of the store coincided with new ideas about masculinity, which allowed for the adoption of shopping methods previously labeled feminine. The Lady (7 May 1936) commented on this, "It is amusing to find that the man's shop is designed and set out with all the allure of one devoted to women's luxuries. Shopkeepers, evidently, do not share that masculine theory that a man always knows just what he wants and so is immune from display or advertisement."
Design, Display, and Advertising
Zola called the department stores "cathedrals of commerce" and they were certainly associated with lavish, striking, and fashionable architecture, acting as an advertisement for the goods inside. Famous and innovative architects were often employed: Victor Horta designed Innovation in Brussels (1901), Louis Sullivan designed Carson Pirie Scott in Chicago (1899–1904), and Erich Mendelsohn designed the Schocken store in Stuttgart (1926-1928). The Scotsman commented on the opening of Simpson Piccadilly in London designed by the modernist architect Joseph Emberton, "the building is an expression in every way of the modern spirit" (4 May 1936). But the buildings were not just fashionable shells. The latest technological advances were used to assist the retail process. Iron then steel frames created vast uninterrupted expanses of floor space and plate glass technology facilitated story-high bands of display windows flanking the shopping street. Inside, escalators and lifts were installed, helping to sustain a continuous flow of customers between the street and the upper echelons of the building. Pneumatic tube systems were provided for communication and placing orders. Tiers of galleries allowed light from the roof to penetrate the shop floor, assisted by the pioneering use of first gas then electric lighting. Lighting was also used on the facade of the building— floodlighting, lit signage, and window illumination—so that the stores had a nighttime presence in the city, catching the eye of revellers.
Department stores led the way with developments in retail display, with opulent displays of goods inside the stores, in the shop windows, and sometimes spilling onto the streets. Displays were often themed in relation with events being held in the stores or national celebrations. It was the shop window in particular that became emblematic of the department store's contribution to the urban spectacle and seduction of customers. The early department stores had a particularly sophisticated understanding of the power of advertising. To the consternation of traditional smaller-scale retailers, significant amounts were spent on newspaper and magazine advertisements, and on regular publishing of catalogs, the Bon Marché in Paris distributed 1.5 million catalogs. In 1894 (Crossick and Jaumain p. 12). This emphasis on design, display, and advertising was integral to the new kind of shopping promoted in the department store, encouraging consumption through the exploitation of visual pleasures.
Crossick, Geoffrey, and Serge Jaumain, eds. Cathedrals of Consumption: The European Department Store. Aldershot, U.K.: Ashgate, 1999. The key text in the field: an excellent and diverse edited collection of essays.
Leach, William. Land of Desire: Merchants, Power and the Rise of a New American Culture. New York: Vintage, 1993. A lively account of the American story from the 1890s to the 1930s.
MacPherson, Kerrie L., ed. Asian Department Stores. Richmond, Surrey U.K.: Curzon, 1998.
Miller, Michael The Bon Marché: Bourgeois Culture and the Department Store, 1869–1920. Princeton, N.J.: Princeton University Press, 1981. A case study of the first department store, highlighting issues of class and business methods.
Moss, Michael, and Alison Turton. A Legend of Retailing: House of Fraser. London: Weidenfeld and Nicolson, 1989. A detailed, well-illustrated account of one of Britain's most important department store groups.
Rappaport, Erika Diane. Shopping for Pleasure: Women and the Making of London's West End. Princeton, N.J.: Princeton University Press, 2000. A contextual study of the department store in its West End location in the Victorian and Edwardian eras, focusing on issues of gender.
Zola, Émile. The Ladies' Paradise. Oxford U.K.: Oxford University Press, 1998. This is a translation of Zola's novel Au bonheur des dames, first published in 1883, reputedly based on the Bon Marché.
DEPARTMENT STORES , an innovation first recognizable in mid-19th-century France. Similar contemporaneous developments were consumer cooperatives in Britain, and mail-order houses, chain stores, and "five-and-ten" stores in the United States. Only in Central Europe were department stores initiated and developed by Jewish entrepreneurs, except for the outstanding cases in Britain, South Africa, and the United States noted below. Of the five German department chain stores – *Schocken, *Tietz, *Wertheim, Karstadt, and Kaufhof – the first three were owned by Jews; although the last two were owned by non-Jews, they employed many Jews in top managerial positions. Jewish department stores were prominently situated in major cities; the N. Israel and Kadewe stores of Berlin and the Gerngross of Vienna were widely known. In addition, most medium and small towns had their own department stores, which were often Jewish-owned. The north German stores, founded in the last quarter of the 19th century for the sale of textiles, a field in which Jews were traditionally prominent, adapted to rapid industrialization and urbanization by expansion and diversification. Although department stores in Germany did not account for more than 4–5% of the total retail commerce, they aroused widespread and lasting hostility. The complaints and anxieties of small or specialized shopkeepers found support in conservative circles in general. Economic accusations of dishonest advertising and other unfair competitive practices merged with antisemitic attacks: the importance of the new type of Jewish shopkeeper was unpalatable to many; the very employment of Christian sales girls was distorted – they were pictured as being placed in danger of moral corruption by lustful Jewish bosses. In the late 19th and early 20th centuries this anti-department store pressure resulted in the levy of special taxes on department stores.
Under the Weimar Republic these laws were abolished and the stores entered a period of growth and expansion. Economic instability and unemployment, however, again made the stores a focus of popular resentment which the Nazis were quick to utilize. Before and especially after the Nazis seized power the stores were frequently sabotaged and their owners attacked in the streets. The nationwide *boycott of April 1, 1933, was specifically aimed against Jewish department stores, which continued to be harassed after the boycott was called off. Julius *Streicher, as Gauleiter of Franconia, led a vicious campaign against the Nuremberg Schocken store. The German government was eventually forced to ease the pressure for economic reasons and even to save the Tietz company from bankruptcy. On "Kristallnacht" (Nov. 9–10, 1938), the department stores, as symbols of Jewish economic oppression, were burned and looted along with the synagogues.
Jews played a major role in the development and ownership of department stores in the United States. The majority of such Jewish-owned stores originated with the 19th-century German-Jewish immigration to America. Many of these immigrants began their commercial careers as itinerant peddlers or small retailers in rural areas, where they enjoyed a virtual monopoly on merchandising; from there they expanded to large general stores, which eventually developed into the modern department stores of the late 19th and 20th centuries. A typical case was the *Gimbel family: after Adam Gimbel, a native of Germany, had opened a general store in the small town of Vincennes, Indiana, his seven sons established department stores first in Milwaukee, then in Philadelphia, and finally in New York, where Gimbels ultimately became one of the city's largest retail establishments. Its greatest competitor, Macy's, was not originally Jewish-owned, but was bought out in 1887 by the *Straus brothers, Isidore and Nathan, who had started by renting its basement to display the produce of the small glassware firm founded by their father Lazarus. In Brooklyn the brothers went into partnership with another German immigrant, Abraham *Abraham, to found Abraham & Straus. Bloomingdale's in New York grew out of a small drygoods store on Third Avenue owned by the *Bloomingdale brothers. Other New York department stores, such as B. Altman, Stern, Saks, S. Klein, and Ohrbach had similar histories, the latter two founded by 20th-century immigrants. Elsewhere in the U.S. large department store empires were also frequently the creation of Jews, such as I. Magnin and Levi *Straus on the West Coast, William *Filene's Sons Co. in the Boston area, Kauffmann Brothers in Pennsylvania, and Neimann & Marcus in Texas. The Chicago company of Sears, Roebuck, which came under the ownership of Julius *Rosenwald during the 1890s, became a vast mail order firm. Sears, Roebuck and other mail order firms, together with urban growth and the automobile, brought about the virtual extinction of countryside peddling as successfully practiced by Jewish immigrants. Jewish prominence in department store ownership continued, however. A highly successful chain of discount stores founded by a syndicate of young Jewish businessmen after the Korean War was E.J. Korvette, an acronym for "Eight Jewish Korean Veterans." Also prominent was the Farkas family, which owned Alexander's department store, a major entry in the New York market through the 1950s and 1960s.
By the early years of the 21st century, the retailing environment in the United States had changed, and most of the giant chains started years earlier by Jewish merchant families had disappeared like Korvette's or were absorbed in mergers and acquisitions. Federated Department Stores, for example, started in 1929 as a combination of Abraham & Straus of Brooklyn, Filene's of Boston, F&R Lazarus of Columbus, Ohio, and Bloomingdale's of New York. The stores operated independently for decades under the Federated umbrella and Federated also included Stern's, Burdine's, Rich's, Goldsmith's, and others, but in 2004 Federated, after gobbling up the May Company, decided to unite virtually all of its 400-odd stores under the Macy's brand name. The lone exception was Bloomingdale's, which grew from its New York origins to a high-end chain in several major American markets.
Nevertheless, other enterprising merchants entered the field, including Leslie H. *Wexner, who built The Limited, a chain in Columbus, Ohio, that specialized in women's clothing. By the late 1980s The Limited had become the parent of Henri Bendel, Lane Bryant, Victoria's Secret, Abercrombie & Fitch, and the Express stores and had a majority stake in Intimate Brands, which included Bath and Body Works and the White Barn Candle Company. The Wexner family was involved in many Jewish charities, supporting youth development programs, Jewish agencies, and temples and a long roster of organizations in the United States and Israel.
In Great Britain Simon *Marks and Israel *Sieff developed Marks and Spencer, famous for its high-quality, reasonably priced goods, and Sir Isaac *Wolfson founded Great Universal Stores. The *Cohen family of Liverpool established Lewis' chain of departmental stores in the north of England. In English-speaking countries public opinion was not hostile to department stores and recognized their advantages to the community. The leading Australian department store line was founded by Sidney (Simcha Baevski) *Meyer, founder of the Melbourne Myer Emporium. Jewish businessmen and industrialists played an important part in the development of the modern department store in South Africa, sometimes called there a "bazaar." In 1927, Sam *Cohen and Michael Miller, who had been in business together for 11 years, founded the o.k. Bazaars in Johannesburg and in time made it the largest chain-store business in South Africa. In 1931, Woolworths – independent of the company of similar name abroad – was started in Cape Town by Max Sonnenberg and developed with Elie Suzman to operate in other South African cities. In 1947 they became associated with Marks and Spencer of Britain. Other department stores such as Greatermans and the Belfast Warehouse were also developed by Jewish enterprise, while the countryside pharmacies of the South African Druggists Ltd. were largely the creation of Herman Karnovsky. Jewish involvement in department stores has undoubtedly diminished but new and notable entrepreneurs in retailing have arisen both in Britain (see *Green, Philip and *Kalms, Sir Stanley) and among Australian business leaders, many of whom are former refugees, operating chain stores and shopping centers.
In Israel the Histadrut developed a chain of small department stores called Ha-Mashbir la-Ẓarkhan. The first one opened in 1947 and by 1970 there were 14 branches throughout the country. A single large department store, Kol Bo Shalom, opened in Tel Aviv in 1965.
H. Uhlig, Die Warenhaeuser im Dritten Reich (1956), incl. bibl.; G. Tietz, Hermann Tietz (Ger., 1965); K. Zielenziger, Juden in der deutschen Wirtschaft (1930), 206–20 (on Tietz); Reissner, in: ylbi, 3 (1958), 227–56 (on N. Israel); Moses, ibid., 5 (1960), 73–104 (on Schocken); G. Rees, St. Michael: A History of Marks and Spencer (1969); M.C. Harrimann, And the Price is Right (1958); A. Marshall, The Gay Provider (1961); A. Briggs, Friends of the People (1956).
[Henry Wasserman /
Stewart Kampel (2nd ed.)]
With the creation of the first department stores at the end of the nineteenth century, came the inception of that most American of diversions—shopping. Though people had always purchased necessities, it was the development of the emporium that turned the perusal of a wide variety of goods, both the necessary and the frivolous, the affordable and the completely out of reach, into a leisure pastime. Between the late 1800s and the 1970s, department stores continued to grow and evolve as the quintessential modern market-place, both elite and accessible. Huge department stores, named for the families who founded them, dominated urban centers, and store and city became identified with each other. Filene's of Boston, Macy's and Bloomingdale's of New York, Marshall Field of Chicago, and Rich's of Atlanta are only a few of the stores recognized nationwide as belonging to their city. The era of the department store is rapidly fading, replaced by consumer choices that are more consistent with modern economics, just as the department stores themselves once replaced their predecessors.
As the nineteenth century drew to a close, citizens began to enjoy the benefits of a new cash economy. Improved postal service and a new nationwide rail network allowed for an unprecedented flow of goods. Previously, consumers had been dependent on traveling peddlers, who carried such stock as sewing needles, thread, and fabrics from town to town in bulky packs on their backs or in horse-drawn carts. As these peddlers grew more prosperous, they began to settle in small storefronts. As economic times improved with the modernizations of the late 1800s, savvy shopkeepers began to expand, offering not only a wider variety of goods, but also an air of refinement and personal service that had previously been available only to the very rich. An example of this was Marble Dry Goods, opened by A. T. Stewart in Manhattan in 1846. Stewart set up posh parlors for his female customers with attentive sales clerks and the first Parisian style full-length mirrors in the United States. Thus, department stores drew all classes of customers by making them feel as if they were part of society's elite while shopping there.
Owners of the new department stores were able to undercut the prices of their competitors in the specialty shops by going directly to the manufacturers to purchase goods, bypassing the wholesalers' mark-up. Some even manufactured their own products. Where once stores had been slow, sedate places where goods had to be requested from behind the counter, the lively new department store displayed products prominently within reach and encouraged browsing. To keep customers from leaving, stores expanded to sell anything they could possibly need. Smaller stores responded with outraged protests that the larger stores were employing unfair practices and running them out of business, but they had little success in slowing the growth of the giant emporiums.
As the cities grew, so did the stores, becoming multi-floor edifices that were the primary generators of retail traffic in newly burgeoning downtown areas. Women, who were enjoying some new rights due to the wave of feminism in the late 1800s and early 1900s, began to have more control over the shopping dollar. By 1915, women did 90 percent of consumer spending in the United States, and the department stores catered to women and began to hire them to work as salesclerks.
Stores competed with each other to have the most refined atmosphere, the cheapest bargain basement, the most fashionable tea room, the fastest delivery, and, most of all, the most attentive service—the most important product offered in the grand emporiums.
In 1911, Sears and Roebuck offered credit to their customers for large mail order purchases, and by the 1920s the practice had spread to most of the large department stores. Customers carried an imprinted metal "charge plate," particular to each store. Because they were the only form of credit available at the time, department store charge accounts inspired loyalty, and increased their store's customer base.
In 1946, writer Julian Clare described Canada's famous department store, Eaton's, in MacClean's magazine: "You can have a meal or send a telegram; get your shoes half-soled or buy a canoe. You can have your other suit dry cleaned and plan for a wedding right down to such details as a woman at the church to fix the bride's train. You can look up addresses in any Canadian city. You can buy stamps or have your picture taken." Department stores also developed distinctive departments, with features designed to attract trade. Filene's in Boston made the bargain basement famous, with drastically reduced prices on premium goods piled on tables, where economically-minded customers fought, sometimes physically, over them, and even undressed on the floor to try on contested items. Department store toy departments competed to offer elaborate displays to entertain children, who were often sent there to wait for parents busy shopping. Marshall Field's toy department introduced the famous puppet act "Kukla, Fran, and Ollie" to the Chicago public before they found their way onto television screens, while Bullocks in Los Angeles had a long wooden slide from the toy department to the hair salon on the floor below, where children might find their mothers. Department store window displays were also highly competitive, fabulous artistic tableaux that drew "window shoppers" just to admire them.
Department stores even had an effect on the nation's calendar. Ohio department store magnate Fred Lazarus convinced President Franklin Roosevelt to fix Thanksgiving on the fourth Thursday of November, rather than the last Thursday that had been traditional. The extra week of Christmas shopping afforded by the switch benefitted the department stores and, Lazarus assured the president, the nation. John Wanamaker of the famous Philadelphia store created Mother's Day, turning a little-known Catholic religious holiday into another national day of spending. Christmas itself became strongly identified with the stores as thousands of department store Santas were photographed holding future customers on their laps.
In the 1950s, middle class families began to abandon the cities for the suburbs. More and more, only less affluent people were left in the urban centers, and as a result, the great flagship downtown department stores began to lose money. Suburban shopping malls began to spring up, and most department stores opened branches there. For over 20 years it was considered necessary to have a large department store as an "anchor" for a mall, and customers continued to patronize the department stores as their main retail sources. Beginning in 1973, however, the oil crisis, inflation, and other economic problems began to cause a slowing of growth in the department stores. The arrival of bank credit cards such as Visa and MasterCard put an end to customer dependence on department store credit. Discount stores, large stores that offered a wide inventory like the department stores, but without the grand style and attentive service, often had lower prices. In an economy more and more focused on lower prices and fewer amenities, department stores waned and discount stores grew.
Gradually, many of the once-famous department stores went out of business. Gimbals', B. Altman's, and Ohrbach's in New York, Garfinckel's in Washington, D. C., Frederick and Nelson's in Seattle, and Hutzler's in Baltimore are just a few of the venerable emporiums that have closed their doors or limited their operations. They have been replaced by discount stores, specialty chains, fast-growing mail order businesses, and cable television shopping channels like QVC. Huge discount chains like Wal-Mart inspire the same protests that the department stores drew from their competition at the early part of the twentieth century: they are too big and too cheap, and they run the competition out of business, including the department stores. Chains of specialty shops fill the malls, having national name recognition and offering customers the same illusion of being part of the elite that the department stores once did. Mail order houses flood potential customers with catalogs and advertisements—over fourteen billion pieces a year—and QVC reached five billion dollars in sales within five years of its inception, a goal department stores took decades to achieve.
Besides bringing together an enormous inventory under one roof and customers from a wide range of classes to shop together, department stores helped define the city centers where they were placed. The failure of the department stores and the rise of the suburban shopping mall and super-store likewise define the trends of late twentieth century society away from the city and into the suburb. Though acknowledgment of class difference is far less overt than it was at the beginning of the century, actual class segregation is much greater. As the cities have been relegated to the poor, except for those who commute there to work during the day, public transportation (except for commuter rush hours) and other public services have also decreased in the city centers. Rather than big stores that invite everyone to shop together, there are run-down markets that sell necessities to the poor at inflated prices and specialty shops that cater to middle class workers on their lunch hour. There are few poor people in the suburbs, where car ownership is a must and house ownership a given. There too, shopping is more segregated, with the working and lower middle class shopping at the discount houses and the upper middle class and wealthy frequenting the smaller, service-oriented specialty stores. The department stores that remain have been forced to reduce their inventory. Priced out of the market by discount stores in appliances, electronics, sewing machines, fabrics, books, sporting goods, and toys, department stores are now mainly clothing stores with housewares departments.
Benson, Susan Porter. Counter Cultures: Saleswomen, Managers, and Customers in American Department Stores, 1890-1940. Urbana, University of Illinois Press, 1986.
Cohen, Daniel. "Grand Emporiums Peddle Their Wares in a New Market." Smithsonian. Vol. 23, No. 12, March 1993, 22.
Harris, Leon A. Merchant Princes: An Intimate History of Jewish Families Who Built Great Department Stores. New York, Kodansha International, 1994.
Leach, William. Land of Desire: Merchants, Power, and the New American Culture. New York, Pantheon, 1994.
Schwartz, Joe. "Will Baby Boomers Dump Department Stores?"American Demographics. Vol. 12, No. 12, December 1990, 42.
From its beginnings at the end of the nineteenth century to its decline in the 1970s, the department store was the major center for urban American shoppers. A creative sales idea, the department store offered working people attentive service, an elegant place to shop for almost everything they needed, and the chance to buy on credit. Large department stores, usually named for the families that started them, became central fixtures in the downtown areas of their cities. Eventually, they became the foundations of shopping malls (see entry under 1950s—Commerce in volume 3) in the suburbs (see entry under 1950s—The Way We Lived in volume 3). In the 1970s, large, no-frills discount stores began to compete with the popularity of department stores. By the 1990s, many of the distinguished old department stores had gone out of business.
Before large department stores began to develop, shopping had meant waiting for a traveling peddler to drop by with a cart of goods for sale, or going into a small shop and asking the clerk for items kept on shelves behind the counter. In the late 1800s, the development of a national railroad and a more efficient postal system allowed a wider variety of goods to be shipped. Stores began to expand. To increase sales, shop owners began to display goods openly on shelves in the store where customers could look through them. The shop owners hired sales clerks like those who served in upper class shops. Some successful store owners built multistory buildings for their new department stores. Soon these stores were closely identified with their cities, like Rich's of Atlanta, Georgia; Filene's of Boston, Massachusetts; and Gimble's of New York City. In 1924, Macy's department store in New York was the largest store in the world.
Department stores have frequently influenced the culture around them. Mother's Day (see entry under 1910s—The Way We Lived in volume 1) had been a minor Catholic holiday until it was turned into a major gift-giving (and therefore, shopping) occasion by the owner of Wanamaker's department store in Philadelphia, Pennsylvania. Of course, the primary gift shopping time in the United States is the Christmas season, and department stores have made it their own, beginning with department store Santas, like the one in the film Miracle on 34th Street. In 1939, Robert L. May (1905–1976), an advertising writer for Montgomery Ward, wrote Rudolph the Red-Nosed Reindeer (see entry under 1940s—Print Culture in volume 2) as part of the company's Christmas sales campaign. During the 1940s, another department store owner, Fred Lazarus, persuaded President Franklin Roosevelt (1882–1945) to change Thanksgiving from the last Thursday in November to the fourth Thursday to allow an extra week of shopping before Christmas.
For More Information
Bragg, Arthur. "Will the Department Store Survive?" Sales and Marketing Management (Vol. 136, April 1986): pp. 60–65.
Cohen, Daniel. "Grand Emporiums Peddle Their Wares in a New Market." Smithsonian (Vol. 23, no. 12, March 1993): pp. 22–31.
Katz, Donald R. "The Big Store." Esquire (Vol. 108, September 1987): pp. 107–17.
Leach, William R. "Transformations in a Culture of Consumption: Women and Department Stores, 1890–1925." Journal of American History (Vol. 71, September 1984): pp. 319–43.
Department stores emerged in the mid-1800s and offered a wide variety of goods for sale in various categories. Many were transformed general stores (which offered a variety of goods but were not divided into departments), while others evolved out of dry goods stores (which sold textiles and related merchandise). The first bona fide department store was established in Paris: the Bon March (French, meaning "good bargain") opened its doors in 1838.
Between the 1850s and 1880s, numerous department stores opened in U.S. cities. The department store Jordan Marsh was founded 1851 in Boston, Massachusetts. R.H. Macy's was founded 1858 in New York City and was known for its creative advertisements. Wanamaker's, founded in 1861 in Philadelphia, successfully implemented fixed pricing so that customers no longer haggled over price. Marshall Field was founded in 1881 in Chicago, Illinois, and within twenty-five years it became the world's largest wholesale and retail dry goods store. These pioneer department stores, multi-storied buildings located in downtown areas, introduced many innovations to merchandising, including the policy of returnable or exchangeable goods, ready-made apparel, clearly marked prices, and window displays.
By the early 1900s department stores could be found throughout the country. The timing was right for their emergence: urban centers grew rapidly at the end of the century, giving department stores a ready clientele. Also the advent of the telephone, electric lighting, and billing machines helped retailers conduct business efficiently. Transportation improvements allowed for the shipment of large quantities of goods, a variety of finished goods were mass produced (which increased supply and lowering production costs and consumer prices). By the 1910s the stores were part of a new mass culture, which centered in U.S. cities. During the twentieth century, department store sales typically generated between six and twelve percent of total annual retail sales.
See also: Chain Store, Mail-Order House, Retail Industry
Department Store ★ Bargain Basement 1935
Confusing crime-drama involving a store manager who mistakes an ex-convict for his employer's heir. Based on a story by H. F. Maltby. 65m/B VHS . GB Garry Marsh, Eve Gray, Sebastian Shaw, Geraldine Fitzgerald, Jack Melford; D: Leslie Hiscott; C: William Luff.