New Kid in Town : Bloomingdale’s Push Reflects Retail’s Changes

Bloomingdale’s, the New York-based department store operator that refers to itself as “The Store,” is coming to Southern California with its guns blazing.

It will host a Nov. 7 gala fund-raiser at its new Century City store featuring entertainers Phil Collins, John Mellencamp and Jerry Seinfeld. The store will open two days later.

Subsequent in-store promotions--from TV mom Florence Henderson to stylish designer Tommy Hilfiger--are supposed to keep Bloomingdale’s other Southland locations in Newport Beach and Sherman Oaks (both opening Nov. 16) in the spotlight as retailers prep for the all-important holiday shopping season that kicks off during the Thanksgiving weekend.

Behind the scenes, the upscale department store operator has been engaged in a tug of war with competitors as it rushes to fill about 2,000 jobs, ranging from the loading dock at the Newport Beach Fashion Island store in Newport Beach to the chain’s West Coast executive suite in Century City.

Bloomingdale’s arrival marks the latest chapter in a dizzying wave of changes sweeping the retail industry.

As part of the trend toward consolidation, Robinsons has merged with May Co., and venerable nameplates such as Bullock’s, I. Magnin and the Broadway have been retired.

There’s also new competition from national chains such as Best Buy that use huge stores and the promise of low prices to lure shoppers.

Bloomingdale’s Western expansion--a fourth store will open Nov. 8 in Palo Alto and a fifth is to open in March at Los Angeles’ Beverly Center--is part of a trend toward national competition in an industry that’s struggling to pump up paper-thin profit margins.

“It’s interesting that this is such a rapidly changing industry,” said Ira Kalish, a Los Angeles-based economist with Management Horizons, a division of Price Waterhouse.

“Typically, when you think of change, you think of high-growth industries like high-tech and telecommunications. But retailing isn’t high-growth. It’s stagnant.”

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The arrival in Southern California of the chain that brothers Lyman and Joseph Bloomingdale founded in 1872 to sell hoop skirts to genteel New York ladies will no doubt delight some upscale Southern Californians and transplanted Easterners who grew up shopping at the chain’s flagship store.

The five Bloomingdale’s in the Golden State are creating rare opportunities for retail industry executives who’ve watched career options dwindle during the industry’s contraction.

Bloomingdale’s has imported executives from stores in the East, but it has also actively recruited several from competing retail chains.

Michael Lindblad, 42, a Thousand Oaks resident who is vice president of Bloomingdale’s California region, crossed over from Robinsons-May, where he had been responsible for 15 department stores in California and Arizona.

Kathryn McDonnell, general manager of Bloomingdale’s Fashion Island store, previously managed the Robinsons-May at MainPlace Santa Ana.

Robin Russell, a Los Angeles-based vice president with Kenzer Corp., declined to discuss specifics of the executive searches her firm conducted for Bloomingdale’s.

But she acknowledged that retail chains often look to competitors for executive talent.

Bloomingdale’s has also stirred up the employment pot for store-level workers.

“Obviously, someone with experience at Nordstrom or Neiman Marcus is going to be of interest to Bloomingdale’s,” said Dennis DeNaut, general manager of Brea Mall.

“In our industry, whenever a good job opens up, there’s a flurry of activity.”

Bloomingdale’s Fashion Island store generated defections by “a small handful” of Nordstrom employees in Orange County, said John Bailey, a Costa Mesa-based spokesman for the Nordstrom chain.

“While we hate to lose employees, we know it’s a personal decision where people work,” Bailey said.

“Bloomingdale’s is a good organization, and we wish any employees who’ve decided to go over there a good future.”

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As Bloomingdale’s scrambles to train new employees and stock its shelves with upscale goods, it’s also unleashing a publicity barrage designed to keep shoppers buzzing about the new kid on the retail block.

“We recognize the benefits of the good timing involved with opening during the fourth quarter,” Lindblad said.

Bloomingdale’s will be able to open four stores for the holiday season because of a real estate deal completed more than a year ago by parent Federated Department Stores.

Federated acquired dozens of former Broadway stores, which it has refurbished and restocked as Bloomingdale’s and Macy’s.

“We were lucky that the Broadway deal got consummated when it did,” Lindblad said. “And all of our focus, naturally, was on getting into this market prior to the holidays.”

Bloomingdale’s individual stores will hold grand openings and special events.

The Newport Beach store, for example, will hold a fund-raiser Nov. 14 to benefit Children’s Hospital of Orange County and Orangewood Children’s Foundation.

But the big guns will be featured Nov. 7 when Bloomingdale’s Chairman and Chief Executive Michael Gould will host an “Ultimate Premiere” at the Century City store.

The cocktail and dinner party for 1,400 invitees will be staged in a huge tent next to the store. The fund-raiser, to be chaired by Walt Disney Co. President Michael Ovitz, will benefit the UCLA School of Medicine and will feature a who’s who of Southern California’s business and social communities.

The hoopla is part of Bloomingdale’s bid to build on the considerable cachet it enjoys among high-end consumers with fond memories of the chain’s fabled Art Deco flagship store at 59th Street and 3rd Avenue in Manhattan.

“There’s a tremendous advantage in being a well-known retailing name that heretofore hasn’t been in the market,” economist Kalish said. “There’s going to be a large curiosity factor, which in and of itself will draw people in.”

But once the shoppers are inside, Kalish added, it will be up to Bloomingdale’s to execute its strategies and prove that its prices, selection and service are more in tune with Southern Californians’ tastes than are the competition’s.

Bloomingdale’s hopes to prosper in a niche once dominated by upscale retailers such as I. Magnin and Bullock’s.

Those types of elite chains, Lindblad said, “have disappeared or been homogenized into a more moderate [price] format.”

But Lindblad cautioned competitors against assuming that Bloomingdale’s will cater only to “a narrow band of people, say, in Beverly Hills and the carriage trade.

“You can bet that if we’ve got popular brands that are found in the rest of the market that we’ll have it at market prices,” Lindblad said.