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Like this: Like Loading He further argued that sound businesses never depend on easy credit. Instead, they acquired gold and silver reserves as collateral. Those without such reserves declared bankrupt when the economy soured. According to McGillin, customers in the s enjoyed an advantage of earlier generations in that they have the where-for-all to shop around for the best possible deal. They turn, more often than not, to well-established department stores for their goods.
Large-scale department stores required carefully orchestrated business planning. Once an enterprising business person understood the fundamental principles of retailing then it was up to that individual to stay informed of the latest business and fashion trends. Certain staples within the industry such as advertising, customer services and salesmanship grew more sophistication over time. Successful late 19th century retailers often used psychology to promote sales.
Store owners wanted their customers to buy as many items and take advantage of as many services as possible. The sky was the limit. Also, every establishment developed its-own identity. Many focused on everyday shoppers, while others concentrated on the needs and wants of the growing middle and upper classes.
Whatever their customer-base, all retailers conveyed a similar message. Some transported their shoppers to distant and exotic lands through high priced, imported merchandise. These items included such things as expensive perfumes, fine wines, rare cheeses, luxurious furs and designer jewelry. Others emphasized everyday items such as auto parts, appliances, work clothes, stationary and tools. This kind of merchandise required little fanfare and practically sold itself.
Showmanship represented half the battle, knowing what the shoppers really intended to buy was the other half. Through it all, common sense prevailed. Once customers believed in the integrity and sincerity of their local department stores, then it became the responsibility of those retailers to provide the desired goods and services at a fair price. Store owners knew all too well that if they slacked in their chosen roles that other retailers were prepared to serve their every need. This new approach to retailing whereby the customer was always right ran counter to the take-it-or-leave-it philosophies of general stores.
Known for supplying hardware and software products within a no-frills environment, general stores served a useful function for many years. Their friendly, informal settings especially flourished in remote parts of the nation where survival itself depended upon settlers being able to secure durable, low-cost staples quickly.
With the advent of the Industrial Revolution and the elimination of the American frontier, all of that changed. Insightful department store owners distinguished between hardware and software items with most focusing on one or the other. Competition among department stores, from the s to the s, intensified greatly.
Increasing public pressure for reasonably priced goods and high quality services led large retailers to offer a barrage of new and enticing incentives and luxuries. Daily newspaper advertising played an ever important role in promoting individual department store merchandise and services. The idea of advertising was not new. Astute retailers in the U. Not only did it foster increased consumer demand for merchandise generally, but also, proved highly effective in promoting certain items over the exclusion of others.
Its intensity, rather than its goals, changed over time. Most early and midth century advertising occurred in local newspapers. These advertisements, often found on the front page of dailies, were often limited to a few lines.
They described the item or items for sale at a particular retailer along with its cost. However, merchandise promotions through the local press expanded quickly. Department stores, by the early s, ran full page advertisements extolling the many virtues of the product or products for sale.
But, they got the job done. Increasingly, retailers stressed the need for the middle class customers to emulate the wealthy. Advertisements, throughout the s, featured testimonies by celebrities and sports figures promoting merchandise. The s saw the introduction of Sunday newspaper pictorial sections. Called rotogravures, they detailed community social events through photographs. They were often accompanied by full-page advertisements showing the latest fashions found in a certain store.
Motion pictures also promoted department stores, but in a somewhat different way. Not relying on store advertising to sell their productions, Hollywood producers took great care when it came to selecting department stores for their films.
Like other successful business leaders of their day, Hollywood promoters wanted the biggest bang for the buck. Only the best and biggest department stores got their names on the marquee. Movie newsreels also featured department stores. Topics ran the gamut from the latest fashions worn by a specific star at a prominent event to what constituted proper department store etiquette for children.
Some stores, in the s and s, went so far as to advertise between features at local drive-in theaters. With the advent of radio and television, department stores relied on jingles to sell their merchandise. Retailers also sponsored their-own radio spots. Television, like films, devised very clever ways to weave popular department stores into their programming. Major televised events sponsored by large department stores included such things as Easter Day, Thanksgiving Day and Christmas Day parades.
The big three television networks also, on occasion, utilized department stores as backdrops for situation comedies. The importance of advertising notwithstanding there were other factors accounting for the phenomenal success of department stores during the late 19th and early 20th centuries. The majority of retailers used any-and-all economic or geographical advantages they might possess to promote sales. Their decision to concentrate within major downtowns was no accident.
Most major economic and social activities in 19th century communities occurred there. It took the advent of horse-drawn buses followed by electric streetcars and automobiles before the elite removed themselves from the hustle and bustle of downtown to the more pristine suburbs.
Prestigious law firms, major hospitals, prominent insurance companies, popular business concerns, large service industries and virtually all government services chose downtown locations. Recognizing the importance of prime location, major retailers quickly joined the bandwagon. Beginning in the early 19th century with modest dry goods companies and large wholesale groceries, downtown retailing soon blossomed into full-service, top quality department stores.
The economic and social complexities readily identified with downtown may have evolved over time, but not its inherent importance. Each new generation of downtown leaders built upon the achievements of their predecessors.
Downtown Cleveland continued to grow and prosper following the Second World War. Old traditions die hard. With the advent of Urban Renewal in the s and s, business and political leaders in large cities, such as Cleveland, began to weigh their options. They envisioned grand, new business opportunities within deteriorating areas bordering downtown.
Congress agreed and approved funding for Urban Renewal beginning with the National Housing Act of Over the next two decades, federal officials poured in millions of dollars for major Urban Renewal projects. Many targeted towards older communities. Designed by the world renowned architect named I. Pei, this acre tract called Erieview represented one of the largest renewal efforts ever undertaken. This announcement came as no surprise to downtown department store owners.
A Cleveland Planning Commission study, published in , claimed that the current surplus in downtown retail space would last for the next seventeen years. No need for further expansion here. Commissioners determined that what the downtown needed was additional high quality housing, first-rate office space and major hotels. Local retailers did not question these findings. In terms of downtown retailing, this shift in weekday pedestrian traffic from the Euclid-Prospect corridor to the East 9th and East 13th street district along with the growth of suburban stores soon marked the end of traditional downtown department stores.
This truth eluded some retailers in the s who tried to remain optimistic. Downtown Cleveland truly lost its luster by the mids.
Major traffic problems, an outmoded public transportation system, and growing incidents of one-on-one crime all but destroyed downtown shopping. Community leaders remained divided over what steps to take next. An interview in the January issue of Clevelander Magazine offered some possible remedies. They were Robert O. Clary of B. Halle President of Halle Brothers Co.
A part of the Greater Cleveland Growth Association, this consortium dedicated itself to the revitalization of downtown Cleveland. Howard B. Klein chaired it. These leaders agreed that growing incidents of crime downtown prevented many Clevelanders from enjoying its many attractions including shopping. Others say the birth of the price tag took place a little earlier, when the Irish-American merchant, Alexander Turney Stewart, opened a store with standardized prices in Brooklyn in Contrary to what the Quakers believed, the poor actually found this development rather unjust, as they no longer had the chance to obtain lower prices through hard bargaining.
After all, negotiating the price of every item with every customer, is a highly inefficient process and one that requires store personnel to be well-trained in bartering. Thus, larger department store chains across Europe and the US quickly adopted the fixed pricing system and helped to popularize it. Deciding on the price for a product once, and then applying a price tag in-store, made retail significantly more efficient than in the bartering era.
Profits are maximized when each customer is charged according to his or her willingness to pay. This can be achieved through dynamic pricing — a pricing strategy wherein a business flexibly adjusts prices for a product or service based on current supply and demand.
Dynamic pricing emerged in the s, driven by technological innovations. It was pioneered by the airline industry, who used factors like departure time, destination and season, to automate the prices for flights. Soon other verticals in the tourism industry, like hotels and car rentals, followed suit. More recently, retailers have also adopted dynamic pricing, with online giants like Amazon leading the way.
In some ways dynamic pricing is similar to the barter system from earlier centuries: prices fluctuate depend on current stock levels, time of day, and market demand. As retail has evolved, so too have customer expectations.
Customers nowadays want shopping to be a fun experience, they want convenience, and they most definitely want the best price possible! Most retailers blame this development on the rise of e-commerce, which has greatly increased both transparency and choice, meaning customers today are easily able to research prices online and switch to competitors.
So, while in the 80s and 90s implementing dynamic pricing was a choice albeit a smart choice , it is now increasingly becoming a necessity. Here is an overview of the steps involved:.
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