Commentary: Preserving The Retail Business

The old Broadway store at Topanga Plaza
The department store that once was – All Photos by Randy Stern

If it weren't for the popularity of the automobile, the department store would have not seen its greatest growth in the last century.

Think about it for a moment: the department store was supposed to be a destination. That is why you found them in the heart of downtown – in any city, you can name. You came by streetcar, bus, train, and car. You found what you wanted – not just needed but wanted – and proudly took it home.

After World War II, our idea of a place to call home changed. We wanted land around our detached homes, distance away from a changing city environment. Our suburbs became our solace. Places, where you can shop by catalog soon, became potential locales in bringing the downtown shopping institution closer to home.

Shopping malls sprung up. The department store would anchor these malls as destinations onto themselves. The Broadway was once the domain of downtown Los Angeles, Wilshire Boulevard, and other city locations were now found in the San Fernando Valley, San Gabriel Valley, Orange County, and beyond. Good ol' Dayton's would anchor the new malls in Edina and Minnetonka; The Emporium opened up beyond Market Street to San Rafael, Hayward, Santa Clara, and so forth. Marshall Fields, The Boston Store, Filene's, Macy's, Belk, Jordan Marsh, Gimbel's, Hudson Bay Company, Eaton's…do these names evoke memories of Postwar North America? Only a few of these names remain today.

However, not everyone could afford the good sold by these stores. That was why you had Sears, Penney’s, and Montgomery Wards. They were affordable goods in department stores that were destinations for the masses. Destinations that evoked a larger than life welcome.

I think about this point when I recall Topanga Plaza (now part of Westfield's global shopping mall empire) in my childhood. The ceilings were about three-to-four stories high. You walked in the middle of the mall on the second floor only to see this massive wall with Montgomery Ward's name in larger than life signage – in an aqua/teal color. It was a dizzying sight, as well as an awe evoking one.

Both the Sears at Fallbrook Square and in North Hollywood wore a three-story high script of the name that stood about three stories high. How do the sign makers accomplish such feats? The reason for such large signage was to ensure you know where to go for bargains from your favorite department store.

And, yet, our department stores are closing up shop. The names are being erased from our memories. The latest victim of this trend was Sears. One of the greatest names in big box retail – one that offered a catalog to those who can shop from home, and offered many services from credit cards, automotive service, optometry, and sold everything from lawn equipment to undergarments – filed for bankruptcy protection recently. The company has already scaled back store operations by closing across the USA. Their Canadian operations have already ceased to exist.

We have been seeing closures from every remaining department store chain. JCPenney, Macy's, and Sak's affiliates across the USA. Even Target and Walmart have been closing stores.

While the economy appears to be stable-to-strong – depending on how you really see it – there has been a shift in retail sales. The stores remain a destination for the automobile, they compete daily with the internet. We would rather buy an item – sight unseen, without trying it on, and not knowing whether it will fit or not – online through a website or app than walk into a store and take the moment to actually touch the item you want.

And, yet, we all do it. They call it "convenience." They also called it "convenience" when they opened up the suburban shopping mall with the anchor stores from downtown some 60-plus years ago.

Fiat of Brookdale

Online sales are not just affecting department stores. They threaten to reduce the impact on automotive retail. If you want a Tesla, you can get one sight unseen by ordering online and having it dropped off at your home. Some automakers are leaning towards this way.

Some of the automotive transactive functions may be going away, but not the automotive retail business itself. You can research the vehicle online and inquire about said vehicle in inventory, but it would be better if you actually go to the dealership and test drive the vehicle to find out if it is right for you or not. To eliminate that part of the transaction is to give up on the consumer. It would also hurt the retailer’s sales and revenue stream.

Here is something you might not remember – Sears used to sell cars from their stores! Back in 1908, you can get a Sears Motor Buggy delivered to the nearest railroad siding after buying it from the catalog. In 1952, Kaiser-Frazier built the Allstate for Sears customers. It was simply a version of the Henry J compact car.

Meanwhile, there are car buying services through your Costco and Sam's Club memberships.

Why is it easier for us to shop for clothing, appliances, décor goods, and so forth online than to walk into a department store a few miles down the road? Why has it become a way of life where what was once tangible has now become intangible? Do we not want to take public transit, take a ride through a haling app, get into our own vehicles to look at a piece of clothing anymore?

If you did the latter, then those stores would not be closing. Jobs would not be lost. Companies would be able to afford those wages and bonuses to keep the economy running smoothly.

Hopefully, we would not have to resort to this in the automotive retail sector. Not just for Carvana and Carmax, but for the thousands of dealerships that sell every brand imaginable across this continent. More than ever, we need to ensure those jobs and revenues for our economy to continue running smoothly. But, we also need for everyone to step up – on in-store service, first contact service, aftersales support, and service. If you want a repeat customer, step up the quality of your game.

There are too many shuttered department stores across this continent, sitting idle and empty. The last thing we need is a shuttered showroom. The last thing we need is a lack of human interaction towards your next transaction.

Take the lesson from the retreat of the department store and keep the dealership robust and relevant today and in the future!

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