**Disclaimer - this is a test run - I'm hoping to come up with a concept for a daily post in Confessions of a Marketing Consultant. The information here is primarily from "the Wiki". Enjoy!**
2000 – U.S. retail giant Montgomery Ward announces it is
2000 – U.S. retail giant Montgomery Ward announces it is
going out of business after 128 years.
The mail-order industry was started by Aaron Montgomery Ward in 1872 in Chicago.[1]Ward, a young traveling salesman of dry goods, was concerned over the plight of many rural Midwest Americans who were, he thought, being overcharged and under-served by many of the small town retailers on whom they had to rely for their general merchandise. Ward continues to be described as the protector of Grant Park.[2]
The mail-order industry was started by Aaron Montgomery Ward in 1872 in Chicago.[1]Ward, a young traveling salesman of dry goods, was concerned over the plight of many rural Midwest Americans who were, he thought, being overcharged and under-served by many of the small town retailers on whom they had to rely for their general merchandise. Ward continues to be described as the protector of Grant Park.[2]
Early years
Aaron Montgomery Ward was born on February 17, 1844, in Chatham, New Jersey. When he was about nine years old, his father, Sylvester Ward, moved the family to Niles, Michigan, where Aaron attended public schools. He was one of a large family, which at that time was far from wealthy. When he was fourteen, he was apprenticed to a trade to help support the family. According to his brief memoirs, he first earned 25 cents per day at a cutting machine in a barrel stave factory, and then stacking brick in a kiln at 30 cents a day.
Montgomery Ward - Company Years
None of Ward's friends or business acquaintances joined in his enthusiasm for his revolutionary idea. Although his idea was generally considered to border on lunacy and his first inventory was destroyed by the Great Chicago Fire, Ward persevered. In August 1872, with two fellow employees and a total capital of $1,600, he formed Montgomery Ward & Company. He rented a small shipping room on North Clark Street and published the world's first general merchandise mail-order catalog with 163 products listed. It is said that in 1880, Aaron Montgomery Ward himself initially wrote all catalog copy. When the business grew and department heads wrote merchandise descriptions, he still went over every line of copy to be certain that it was accurate.
The following year, both of Ward's partners left him, but he hung on. Later, Thorne, his future brother-in-law, joined him in his business. This was the turning point for the young company, which grew and prospered. Soon the catalog, frequently reviled and even burned publicly by rural retailers who had been cheating the farmers for so many years, became known fondly as the "Wish Book" and was a favorite in households all across America.
Ward's catalog soon was copied by other enterprising merchants, most notably Richard Warren Sears, who mailed his first general catalog in 1896. Others entered the field, and by 1971 catalog sales of major U.S. firms exceeded more than $250 million in postal revenue. Although today the Sears Tower in Chicago is the United States's tallest building, there was a time when Montgomery Ward's headquarters was similarly distinguished. The Montgomery Ward Tower, on the corner of Michigan Avenue and Madison Street in Chicago, reigned as a major tourist attraction in the early-1900s.
Aug 1872 - None of Ward's friends or business acquaintances joined in his enthusiasm for his revolutionary idea. Although his idea was generally considered to border on lunacy and his first inventory was destroyed by the Great Chicago Fire, Ward persevered. In August 1872, with two fellow employees and a total capital of $1600, he formed Montgomery Ward & Company. He rented a small shipping room on North Clark Street and published the world's first general merchandise mail- order
1872 - In 1872, Aaron Montgomery Ward produced the first mail-order catalog for hisMontgomery Ward mail order business. This first catalog was a single sheet of paper with a price list, 8 by 12 inches, showing the merchandise for sale and ordering instructions.Montgomery Ward identified a market of merchant-wary farmers in the Midwest. Within two decades, his single-page list of products grew into a 540-page illustrated book selling over 20000 items.
1875 - The Montgomery Ward catalog quickly grew in size and distribution. In 1875, Ward offered a money-back guarantee to dissatisfied buyers. This presented a threat to the rural storekeepers, who reportedly burned the Montgomery Ward catalogs in protest.
1890 - In 1890, businessman Montgomery Ward secured a court ruling upholding the principle that 2800 acres
of lakefront parks, including Grant Park, should “ Remain Forever Open, Clear and Free of any Building or
Other Obstruction Whatever." From its beginning, the Montgomery Ward ruling has been interpreted in many ways.
1893 - While Julius Rosenwald was managing the affairs at Sears, there were management changes at Montgomery Ward. Aaron Montgomery Ward's partner, George Thorne, had turned active management of the company over to his sons after buying out Ward in 1893. The company grew steadily if not spectacularly during the following two decades.
1895 - In 1895, the United States Postmaster reported that the “largest patron of [our country's] post office is Montgomery Ward & Co” (The History and Progress of Montgomery Ward and Company, p. 19). Four years later, the Spirit of Progress, a 17′ weathervane/statue, was set atop Ward's Tower Building in downtown Chicago, making it the highest point in the city at 396 feet (ibid, p. 19). The Spirit of Progress became the company logo
In 1883, the company's catalog, which became popularly known as the "Wish Book", had grown to 240 pages and 10,000 items. In 1896, Wards acquired its first serious competition in the mail order business, when Richard Warren Sears introduced his first general catalog. In 1900, Wards had total sales of $8.7 million, compared to $10 million for Sears, Roebuck and Co., and the two companies were to struggle for dominance for much of the 20th century. By 1904, the company had grown such that three million catalogs, weighing 4 pounds each, were mailed to customers. [1]
In 1908, the company opened a 1.25 million ft² (116,000 m²) building stretching along nearly 1/4 mile of the Chicago River, north of downtown Chicago. The building, known as the Montgomery Ward & Co. Catalog House, served as the company headquarters until 1974, when the offices moved across the street to a new tower designed by Minoru Yamasaki. It was declared a National Historic Landmark in 1978 and a Chicago historic landmark in May 2000. [2] In the decades before 1930, Montgomery Ward built a network of large distributions centers across the country in Baltimore, Fort Worth, Kansas City, St. Paul, Portland, Oregon, and Oakland, California. In most cases, these reinforced concrete structures were the largest industrial structures in their respective locations. The Baltimore Montgomery Ward Warehouse and Retail Store was added to the National Register of Historic Placesin 2000.[1][2]
1939 - In 1939, Robert L. May, at the request of his employer, Montgomery Ward Co., wrote a holiday story about a reindeer with a shiny red nose. At Christmastime that year 2400000 copies of the book were distributed through Montgomery Wards stores. The rest is history.
Apr 26, 1944 - Roosevelt, “As commander-in-chief in time of war”, warned Avery that the work stoppage was delaying the delivery of farm implements and other goods necessary for the war effort, threatening “further action” if Wards did not comply. Avery refused to obey the president's order, and on April 26, 1944, “three olive-drab Army trucks rolled up toMontgomery Ward's main entrance”, as related in a Time Magazine article entitled “Seizure!”,
Meanwhile, throughout the 1950s, the company was slow to respond to general movement of the American middle class to suburbia. While its old rivals Sears, J.C. Penney,Macy's, McRae's, and Dillard's established new anchor outlets in the growing number of suburban shopping malls, the top executives thought such moves as too expensive, sticking to their downtown and main street stores until the company had lost too much market share to compete with its rivals. Its catalog business had begun to slip by the 1960s. In 1968, it merged with Container Corporation of America to become Marcor Inc.
During the 1970s, the company continued to flounder. In 1976, it was acquired by Mobil, which was flush with cash from the recent rise in oil prices. In 1985, the company closed its catalog business after 113 years and began an aggressive policy of renovation of the remaining stores. The renovations centered on restructuring many of the store layouts into boutique-like speciality stores. In 1988, the company management undertook a successful $3.8 billion leveraged buyout, making Montgomery Ward a privately held company.
In 1987, it began a push into consumer electronics using the "Electric Avenue" name. Montgomery Ward greatly expanded their electronics presence by shifting from a predominantly private label mix to an assortment dominated by Sony, Toshiba, Hitachi,Panasonic, JVC, and other national brands. This strategy was led by V.P. Vic Sholis, who later became President of the Tandy Name Brand Retail Group (McDuff, VideoConcepts, and Incredible Universe). Seemingly on the right track for a rebound in market share, in the late 1980s and early 1990s Montgomery Ward was one of the hottest retail chains in the country. 1994 brought a 94% increase in revenues, largely due to Ward's tremendously successful direct-marketing arms. For a short while Wards was also back in the mail-order business, through "Montgomery Ward Direct", a mail order business licensed to the catalog giant Fingerhut. But by the mid 1990s sales margins were eroded even further in the competitive electronics and appliance hardlines, which traditionally were Ward's strongest lines.
The company also spun off Jefferson Ward (known as "Jeffersons"), a discount department store version of Montgomery Ward, introduced in 1980. The chain was sold to Bradlees, a division of Stop & Shop, in 1985. All Jefferson Ward stores were former Two Guys, J.M. Fields, or Almart (not to be confused with Wal-Mart) stores.
In 1994, it acquired the now-defunct New England retail chain Lechmere.
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By the 1990s, however, even its old rivals had begun to lose ground to low-price competition from Kmart, Target, and especially Wal-Mart, which stripped away even more of Montgomery Ward's old customer base. In 1997, it filed for Chapter 11 bankruptcy, emerging from bankruptcy court protection in August 1999 as a wholly owned subsidiary of GE Capital, by then its largest shareholder. As part of a last-ditch effort to remain competitive, the company closed 250 retail locations in 30 U.S. states, closed all the Lechmere stores, abandoned the speciality store strategy, renamed and rebranded the chain as simply Wards (although unrelated, Wards was the original name for the now-defunct Circuit City), and spent millions of dollars to renovate its remaining outlets to be flashier and more consumer-friendly. But GE reneged on promises of further financial support of Wards' restructuring plans.
On December 28, 2000, the company, after lower-than-expected sales during the Christmas season, announced it was going out of business and would close its remaining 250 retail outlets and lay off its 37,000 employees. All the stores closed within weeks of the announcement. The subsequent liquidation was at the time the largest retail bankruptcy liquidation in U.S. history. Roger Goddu, Wards' CEO, was offered the CEO position of J.C. Penney. Goddu declined on pressure from GE. One of the last stores to close was the Salem, Oregon location in which the head of the Human Resources Division was located. By May 2001 Montgomery Ward was gone.
In June, 2004, an online retailer was created which sells the same products as the former brand. The company does not currently operate any retail stores. Key "Montgomery Ward" and "Wards" trademarks were purchased by Iowa-based direct marketing company Direct Marketing Services Inc. (DMSI), a catalog marketer, for an undisclosed amount of money.[5] DMSI then began operating under the same branding as the original company and managed to get it up and running in three months and started a new, smaller catalog. It is not the same company as the original, however.[6] As such, the new company does not honor obligations of the previous company, such as gift-cards and items sold with a lifetime guarantee.
Ownership change
In July 2008, it was announced that DMSI was on the auction block, with an auction scheduled for August 2008. Catalog retailer Swiss Colony purchased DMSI on August 5, 2008. Swiss Colony has announced that it will keep the Montgomery Ward catalog division open. The Web site launched on September 10, 2008, with new catalogs mailing in February 2009.[9] A month before the catalogs' launch, Swiss Colony President John Baumann told United Press International the retailer might also resurrect Wards' Signature and Powr-Kraft store brands.[10]
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