$5.8 billion — that’s what a group of investors reportedly offered to buy the Macy’s department store chain, according to The Wall Street Journal. It might not sound like a whole lot of cash. After all, this is an iconic American company with assets that include Macy’s Herald Square in New York City. On the other hand, Macy’s, and department stores in general, aren’t what they used to be.

For two decades, the so-called magic of Macy’s has been losing its luster. Mark Cohen of Columbia Business School sums it up this way: “There’s no there there.”

“What made them famous was they had the things people wanted to buy in a setting people wanted to shop in,” he said. “All of that has disappeared at Macy’s.” 

From deteriorating stores and customer service to a lack of investment in its private labels, Cohen said, the company’s cost-cutting measures make it even harder for the store to set itself apart today.

“Macy’s has been sawing their own legs off slowly and quietly for years in that regard. And now they don’t have much of a leg to stand on,” he said.

Cohen blames poor leadership, though Macy’s is hardly the only department store that has struggled to stay relevant. For one thing, people are shopping less at indoor malls, said Sucharita Kodali with Forrester.

“The shift in real estate has been to what we call mixed-use facilities or a lot of the outdoor strip centers,” she said.

And shoppers have tons of choices these days. “They’re buying more clothes at Costco and Walmart to Amazon and, you know, kind of apparel stores like H&M, Zara, Shein, Temu and the list goes on,” Kodali said.

Another challenge is Macy’s doesn’t carry the modern, tailored products people want to buy, said Jessica Ramírez with Jane Hali and Associates.

“It’s really been out of date and out of touch with the consumer, and it hasn’t evolved as far as how retail is looked at today,” she said.

Ramírez said many in-demand brands are bypassing department stores altogether and going straight to consumers.