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In 2004, I became the CEO of Federated Department Stores. That's what we were called then because that's what we were: a company made up of individual department stores in regional markets. We were printing 16 different bags, running 16 different catalogs, and had buyers who bought only for their area of the country. And we could only run local TV ads, so we'd create 16 different commercials. Since we weren't a national brand, I couldn't even advertise during the Macy's Thanksgiving Day Parade.
I thought the big play was to take advantage of Macy's (M) association with the parade and create one cohesive brand. In 2005, I decided to test the idea, and we began hyphenating our store names. In Atlanta we were called Rich's-Macy's or in Miami we were Burdines-Macy's. There was a lot of pushback. We were taking away names that were 100, 130, even 140 years old, and there was a family behind the name in almost every instance.
We had to fight to make everything just Macy's. One tough one was Meier & Frank in Portland [Ore.]. Gerry Frank is an important member of the community. He said, "Go ahead and change the name elsewhere, but don't change it here. It's part of the fabric." When it came time to make the decision, I flew out and said I had great respect for him and the brand, but renaming the stores would benefit the market.
The same was true with Marshall Field's in Chicago, which came through our acquisition of May Department Stores. On the day we announced we were renaming it Macy's, I flew to Chicago and I met with Mayor Daley. I wanted to tell him first. Now our business in Chicago is among the best in the nation.
The reality is that the change didn't impact sales in a negative way. It was critical that we operate under one national brand. More than 40 percent of the inventory we now sell is unique to Macy's. That would not have been possible before. This year is shaping up to be one of the best in many for the company. If we hadn't made that decision a few years ago, the external environment would have forced it on us. It was the right choice.