Marshall Field and Rise of Department Store

Question 1

Before 1850

Answer 1

small stores
specialty shops
no advertising
1850s: beginning of mass distribution

Question 2

Innovative selling policies

Answer 2

Macy: one-price policy
in response: money-back guaranteed
built a brand
strategy was product quality and desirability, appealing shopping environment, responsive, unpretentious service
-vertical integration: bypassed jobbers and bought directly from manufacturers
-loss leaders: increase store’s conversion rate (since it pays less in inventory: undersell the competition on carefully selected items)

Question 3

Marketing and Customer service

Answer 3

money-back guarantee (trust)
In 1873, first official set of rules:
- clerks prohibited from using aggressive sales technique
- polite, patience, attentive

shopping experience more appealing, hire women sales clerk
tearooms, reading rooms

Question 4

How can they overcome risks such as fires, deflation , decreasing demand

Answer 4

integrated vertically into wholesaling so
steady cash flow allowed to get short-term loans (need for capital very low)
long-term agreements with products allowed to adjust prices downwards

Question 5

Credit Strategy

Answer 5

paid cash for all its purchases to get best price possible

assessment of each customer’s situation, financial integrity and long-term value to company