Wages for the bottom 99% of the population has been stagnate since the early 1980s. From the Great Depression to the 1980s, you had the opposite effect, the income of the top 1% dropped, bu the income of the bottom 90% increased (the group in between, the Top 10% less the Top 1% also saw an increase but in terms of percentage NOT as great as the bottom 90%).
Due to this increase in income from the late 1930s to the early 1980s, people could, and did buy better products. Thus what a "average" family would buy in 1940 was substantially lower in quality then what they children bought for their families in 1960 and what they grandchildren bought for their children in 1980. People slowly upgraded their tastes between 1940 and 1980 and the retail stores cashed in on this movement by slowly improving the quality of their products.
It was noted in the late 1980s and in the 1990s that people were NOT upgrading again, but actually downgrading. i.e. going to Walmart more then Macy's. The reason was income was NOT increasing but stagnating. Retailers bought into the concept that people have increased quality every 20 years anticipated another such increase, but with no increase in real wages, no such increase in quality being purchased occurred. Thus you saw Sears and other retailers upgrade their products in anticipation that the next generation would upgrade just like their parents and grandparents had done. and wonder why their customers deserted them for Walmart, which they saw as a down grade.
Now, the high end stores flourished as the top 10% were able to keep up with the top 1%, but anyone whose customer base was the bottom 90%, saw their sales DECLINE unless they were a severe discounter like Walmart (and Walmart realized that the low discount market was the market most dependent on price, made sure it had the lowest prices, driving its competitors on the low end out of business).
Thus the high end market held its own in the 1990s and today, the low end discounters concentrated into one store, Walmart, and the stores that catered to the people between those two ends, saw their pool of customer become smaller as most of them ended up going to Walmart to maximize their money. Sears and Kmart merged in an effort to save both stores, but only resulted in a larger store to squeezed between Walmart and the high end stores. Macy';s tried to be a high end store, but it was always a middle store dependent on those people NOT going to Walmart but unable to afford the high end stores (and most people can NOT afford those high end stores). Like Sears and Kmart (technically a notch below Macy's but not that much below) the pool of customer has been becoming smaller and smaller which leads to declines in total sales.
Thus Macy's problems is the same as Sears/Kmart and other stores better then Walmart, a declining pool of customers and no way to end the decline. In such situation you end up in the same situation Walmart is in, the biggest store in your niche but unable to come out of it and dependent on your customers and hoping they do not lose any more income. Walmart is stronger here for its customer can NOT lose much more income, but Macy's customers can and will and thus be forced by economics to become Walmart customers.
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