Retail makeover

The Baltimore Sun

When Hecht's officially becomes Macy's on Saturday, the aim is to hold on to some local traditions of the venerable Baltimore-area department store chain in a nod to customer nostalgia.

But there won't be much to keep: Two private-label brands are staying and much of the work force will remain. The frequent coupon sales offered at Hecht's will largely disappear in favor of everyday deals on select merchandise.

The challenge for Macy's as it remakes itself in Baltimore is that Hecht's does not have a signature product, such as candy or a traditional parade, that stands out as do some of the other 10 regional chains that Federated Department Stores is buying from May Department Stores.

In Chicago, Federated is creating a candy kitchen for Frango, the famous chocolates and mints sold at Marshall Field's. In Oregon, Federated agreed to put the Meir & Frank name on plaques outside the stores even after they were renamed Macy's. In Boston, Federated will continue the annual Christmas tree lighting at Filene's and become the official department store sponsor of the Boston Red Sox.

Some of those traditions will be brought to Baltimore as Macy's starts selling products like Frango in its stores. As the department store attempts to re-create itself as a high-fashion retailer with exclusive products, Macy's will also introduce new collections. They include shoes and purses designed by British designer Dame Vivienne Westwood for Nine West and a line of sportswear designed by Elie Tahari. Macy's also will unveil a robotic vending machine that sells iPods and other electronics.

"We feel that is a big part of the piece of the pie that is going to make us distinct," said Paul Proietto, senior vice president of stores for Macy's East and a former Hecht's executive. "Offering merchandise that can only be found at Macy's will help us differentiate ourselves."

For all the pieces that Macy's is trying to fold into its new image, its mission in the $11 billion merger is clear: fixing the problems that have troubled homogenized department stores in recent years and made them second-tier places to shop. To survive, the new Macy's must improve customer service, prove it can provide fresh fashions and attract shoppers younger than 35.

To do that, it must phase out much of what made the regional department stores what they were. Most of Hecht's house brands and others from the May merger are being eliminated. Instead, Macy's will focus on its own private label brands, including INC International Concepts and Style & Co., both contemporary lines for women, and American Rag, a trendy teen line.

"I thought Hecht's had a perfectly OK brand name, but it wasn't like a Neiman Marcus," said Craig Johnson, president of Consumer Growth Partners, a retail and consumer consulting firm in New Canaan, Conn. "On the other hand, Marshall Field's had a strong name in the Chicago area and it still does."

A Macy's East spokesman acknowledged that few pieces of Hecht's would convert to the new stores. But the company said that its local staff is in tune with what Baltimore shoppers want, pointing to, for instance, the popular May clothing brands of John Ashford for men and Karen Scott for women that will be sold at all Macy's. Proietto also said Hecht's had a better merchandising strategy for national brands such as Jockey and Levi's that Macy's will keep in place.

"We're taking the best of both worlds and blending them together," he said. "Even though there will be some of the same merchandise from store to store, we're not going to forget you're from Baltimore and that there are things that you like."

Retail analysts said that local distinction, no matter how small, would help Macy's win over customers who may have an emotional connection to the regional name and see Macy's as a New York name that they can't relate to.

"Consumers respond more to tradition and identify with the feelings of a brand more than they do the brand itself," said Barry Seifer, a principal and head of the retail practice of Cubellis Marco Retail, a retail planning and design firm. "Consumers are saying, 'Leave me with something meaningful. Make sure we still have our traditions.'"

Hecht's has a storied history in the Baltimore-Washington area, growing from a Baltimore furniture store started by Samuel Hecht in 1857.

Karen Elliott, 50, said she remembers shopping at Hecht's as a child and said it's sad that such an institution will soon no longer exist.

"It's too bad all of the old local chains are going away," said Elliott, an information systems consultant who lives in Baltimore.

Federated has already converted three Hecht's into Macy's stores in the Baltimore area - at White Marsh Mall, Owings Mills Mall and Marley Station Mall in Glen Burnie.

On Saturday, Macy's will hold a red carpet event at the Mall in Columbia to celebrate the conversion of the remaining area Hecht's stores. Shoppers will enter the Columbia store along a red carpet, and the first 500 people will get free gift cards - with 10 of them worth $1,000. Elements of the famed Macy's Thanksgiving Day Parade will also begin a road tour that day, stopping at 23 cities, including Columbia on Nov. 12.

There were 11 Hecht's and Macy's in the Baltimore area before the merger. The area will have eight Macy's when the changeover is complete. Boscov's, a Reading-based department store chain, will take over the three sites left vacant at area malls because of the merger.

A recent tour of the White Marsh Macy's with Proietto gave a glimpse of what to expect when all stores are converted. The aisles are wider and the store brighter. There are more mannequins to better display the latest fashions. The Hecht's name is gone.

The salespeople wear black so that they're easier to spot. The juniors department plays the latest hits, much like popular teen stores Abercrombie & Fitch and Holister, known as much for their atmosphere as the clothes. There is also a Mac makeup counter and an open perfume section, rather than one where the bottles are locked behind glass cases.

Macy's also partnered with Project Runway, a television show with supermodel Heidi Klum that pits aspiring fashion designers against one another. On one episode, contestants designed an outfit for the INC line. The winning ensemble was later sold in the store.

The Macy's makeover aims to pump new life into its 800-store chain and persuade shoppers to give department stores another look.

"I think the bigger challenge is not which customers they will lose, but whether they're going to get younger customers back in the stores," said George Whalin, CEO of Retail Management Consultants in California. "You're trying to change the culture of a consumer that has grown up shopping elsewhere."

Department stores represented 2.98 percent of the retail market share last year, compared with more than twice that in 1992, according to Consumer Growth Partners. The merger between Federated and May department stores, which led to the Macy's expansion, is just one of several consolidations over the years that have shrunk the competitive market but done little to win back customers. Sears and K-Mart merged in a high-profile $11 billion deal two years ago.

Federated says that its larger operation will give it more clout with suppliers and enable it to buy more national advertising rather than dividing it up among different regions. It announced its purchase of May last spring and has been slowly transitioning stores since then.

But even with the changes, Macy's knows it will take time to win over customers. Some older customers shopping in White Marsh recently worried that the store had forgotten them in its quest to be more cutting-edge. Others said they liked the ordinary look it had before.

"I don't like it as well now," said Heather Brunin, 31, a nurse from Dundalk. "I'm used to the old Macy's and the way it was set up. I knew where everything was. It was familiar."

But others said the changes are for the better.

"It's much better looking than it was when it was Hecht's," said Angel Watts, 32, as she went school shopping with her daughter and little brother. "I haven't been a big Macy's fan in the past, but I guess I'll try it. This makes me want to give it a chance."

andrea.walker@baltsun.com

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