Shoppers Who Purchase From Upscale Department Stores Also Tend to Shop at

Downmarket Department Stores Before Making a Purchase

    WESTLAKE VILLAGE, Calif., Oct. 11 /PRNewswire/ -- Neiman Marcus and
 Nordstrom lead customer satisfaction rankings among upscale department
 stores in three of the largest U.S. metropolitan shopping areas, and
 JCPenney, Kohl's and Macy's rank highest among midscale stores, according
 to the J.D. Power and Associates 2007 Department Store Experience Study(SM)
 released today.
     (Logo: http://www.newscom.com/cgi-bin/prnh/20050527/LAF028LOGO-a)
     The inaugural study measures customer satisfaction with midscale and
 upscale department stores in three metropolitan areas: Atlanta, Los Angeles
 and New York.(1) Customer satisfaction is measured across four key factors
 (listed in order of importance): sales staff, store facility, merchandise
 and pricing.
     "While customers primarily decide where to shop based on appealing
 fashions and styles of merchandise, the sales staff has the greatest
 influence on the overall department store experience," said Michael De
 Vere, executive director of emerging industries at J.D. Power and
 Associates.
     Atlanta Metropolitan Area
     In the Atlanta area, Nordstrom ranks highest in customer satisfaction
 among upscale stores with a score of 766 on a 1,000-point scale. Among
 midscale department stores, Kohl's ranks highest in customer satisfaction
 with a score of 688. Following Kohl's are Dillard's and Macy's in a tie at
 681.
     Los Angeles Metropolitan Area
     In the Los Angeles area, Nordstrom ranks highest among upscale stores,
 earning a score of 766. Macy's ranks highest among midscale department
 stores with a score of 652.
     New York Metropolitan Area
     Neiman Marcus ranks highest among upscale department stores in the New
 York area with a score of 768, while JCPenney ranks highest among midscale
 stores with a score of 661.
     "Upscale department store shoppers are more interested in the
 availability of exclusive brands and in customer service, which has led to
 Nordstrom's strong performance in Atlanta and Los Angeles and Neiman
 Marcus' strong showing in New York," said De Vere. "It is particularly
 notable that Neiman Marcus ranks highest in the highly competitive New York
 market, where other iconic upscale department stores are based. Shoppers at
 midscale stores are more sensitive to price and seek good value in
 conjunction with a wide selection of brands and fashions, which is where
 JCPenney, Kohl's and Macy's successfully strike a balance in the
 metropolitan areas in which they rank highest."
     The study finds that customers who make purchases at midscale and
 upscale department stores also tend to shop at downmarket department stores
 before making a purchase. For example, four in 10 upscale store customers
 say they shopped at the midscale department store Macy's before making a
 purchase at an upscale store. Furthermore, some shoppers at midscale
 department stores say that they also shopped at discount stores, such as
 Target, before making a purchase at a midscale department store.
     "This blurring of the lines among the upscale, midscale and discount
 segments presents an opportunity for department stores to broaden their
 customer bases," said De Vere. "Midscale stores have expanded their
 merchandise offerings by incorporating more exclusive designer product
 lines that appeal to upscale shoppers. If midscale department stores are
 able to convert more of these upscale shoppers into purchasers, it will
 significantly impact the competitive landscape for upscale department
 stores. Midscale department stores face the same pressures from discount
 stores that are also expanding their lines to include more designers and
 recognizable brands."
     The study results also include the following key findings:
     -- Customers who shop at a midscale department store before making a
        purchase at an upscale store spend an average of $109 per visit and
        $2,393 annually on apparel, while customers who shop at an upscale
        store before purchasing at a midscale store spend an average of $249
        per visit and $4,011 annually on apparel. Average annual spending on
        apparel tends to be higher among women, with approximately 27 percent
        of women saying that they spend at least $2,500 annually on
        apparel-related purchases, compared with only 22 percent of men who say
        the same.
     -- Nearly 45 percent of upscale store customers and 30 percent of midscale
        customers say that they would like their department store to offer a
        designer shopping bag that is reusable, which presents an opportunity
        for stores to provide an environmentally friendly offering. Shoppers 40
        years and younger tend to be more interested in reusable shopping bags,
        compared with their older counterparts.
     -- When department store customers wait in line for more than four minutes
        when paying for merchandise, satisfaction declines significantly,
        compared with customers who don't wait as long. However, customers in
        Los Angeles appear to be more patient than customers in New York and
        Atlanta. Satisfaction declines by an average of 22 points among
        shoppers in Los Angeles who wait longer than 5 minutes to check out,
        compared with 42 and 44 points, on average, among shoppers in Atlanta
        and New York, respectively.
     The 2007 Department Store Experience Study is based on responses from
 5,877 customers who made a purchase at a midscale or upscale department
 store in the Atlanta, Los Angeles, or New York area. Respondents must
 reside within the Metropolitan Statistical Area (MSA) as defined by the
 U.S. Census and must have made a purchase at a department store located
 within the MSA. The study was fielded in July and August 2007. For more
 information on customer satisfaction with upscale and midscale department
 stores in Atlanta, Los Angeles and New York, visit JDPower.com.
     Atlanta Metropolitan Area
 
     Upscale Department Store Segment Overall Satisfaction Index
     (Based on a 1,000-point scale)
     Nordstrom                                            766
     Upscale Store Segment Average                        744
     Neiman Marcus                                        737
     Saks Fifth Avenue                                    737
     Bloomingdale's                                       719
 
 
 
     Midscale Department Store Segment
     Overall Satisfaction Index
      (Based on a 1,000-point scale)
     Kohl's                                               688
     Dillard's                                            681
     Macy's                                               681
     Midscale Store Segment Average                       680
     JCPenney                                             661
 
 
 
     Los Angeles Metropolitan Area
 
     Upscale Department Store Segment Overall Satisfaction Index
     (Based on a 1,000-point scale)
     Nordstrom                                            766
     Upscale Segment                                      743
     Barneys New York                                     716
     Bloomingdale's                                       713
     Neiman Marcus                                        712
     Saks Fifth Avenue                                    701
 
 
 
     Midscale Department Store Segment
     Overall Satisfaction Index
     (Based on a 1,000-point scale)
 
     Macy's                                               652
     Midscale Store Segment Average                       647
     Kohl's                                               645
     JCPenney                                             639
     NOTE: Dillard's is included in the study, but not ranked due to small
     sample size.
 
 
 
     New York Metropolitan Area
 
     Upscale Department Store Segment Overall Satisfaction Index
     (Based on a 1,000-point scale)
     Neiman Marcus                                        768
     Nordstrom                                            752
     Saks Fifth Avenue                                    733
     Barneys New York                                     732
     Upscale Segment                                      732
     Bloomingdale's                                       706
 
 
 
     Midscale Department Store Segment
     Overall Satisfaction Index
     (Based on a 1,000-point scale)
     JCPenney                                             661
 
     Midscale Store Segment Average                       648
 
     Kohl's                                               647
 
     Macy's                                               641
     About J.D. Power and Associates
     Headquartered in Westlake Village, Calif., J.D. Power and Associates is
 an ISO 9001-registered global marketing information services firm operating
 in key business sectors including market research, forecasting, performance
 improvement, training and customer satisfaction. For more information on
 car reviews and ratings, car insurance, health insurance, cell phone
 ratings, and more, please visit JDPower.com. J.D. Power and Associates is a
 business unit of The McGraw-Hill Companies.
     About The McGraw-Hill Companies
     Founded in 1888, The McGraw-Hill Companies (NYSE:   MHP) is a leading
 global information services provider meeting worldwide needs in the
 financial services, education and business information markets through
 leading brands such as Standard & Poor's, McGraw-Hill Education,
 BusinessWeek and J.D. Power and Associates. The Corporation has more than
 280 offices in 40 countries. Sales in 2006 were $6.3 billion. Additional
 information is available at http://www.mcgraw-hill.com.
     J.D. Power and Associates Media Relations Contacts:
     John Tews                               Syvetril Perryman
     Troy, Mich.                             Westlake Village, Calif.
     (248) 312-4119                          (805) 418-8103
     john.tews@jdpa.com                      syvetril.perryman@jdpa.com
     No advertising or other promotional use can be made of the information
 in this release without the express prior written consent of J.D. Power and
 Associates. www.jdpower.com/corporate
     (1) To be included in the study, department stores must be located in
 the Metropolitan Statistical Area, as defined by the U.S. Census, for the
 respective city.
 
 

SOURCE J.D. Power and Associates

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