The department store was supposed to be dead. Instead it is fighting back with the oldest weapon in retail: its own labels. As Amazon, Shein and the off-price chains pull shoppers away from the middle, Macy's and Kohl's are leaning on private brands โ and on a narrower, more premium assortment โ to stay relevant. The house-brand fightback is one of the clearest competitive stories of 2026.
Macy's Is a Turnaround, Not a Decline
Macy's holds 4.9% of US clothing web share in H1 2026, per Similarweb, and the story underneath the number is more interesting than the headline. The company is roughly 80% of the way through a plan to close 150 underperforming stores, and the remodeled locations under its "Reimagine" strategy consistently outperform the rest of the fleet. By shedding weak doors and reinvesting in the strong ones, Macy's is trading footprint for productivity โ the same logic off-price used to gain share, applied in reverse.
Its merchandising bet is differentiation through brands it does not own. Macy's emphasizes premium national names โ Polo Ralph Lauren, Calvin Klein and Tommy Hilfiger โ which gives it a clearer point of distinction against Amazon's sprawling, generic assortment. When a shopper can find a labeled blazer and a known handbag under one roof, the marketplace's infinite shelf looks less essential.
Kohl's and the Private-Label Engine
If Macy's leans on national brands, Kohl's leans on its own. Private-label apparel accounts for about 45% of Kohl's sales โ a share in the same league as JCPenney's 52%, according to Jungle Scout's private-label analysis. That is a completely different model from Amazon's 1%. For Kohl's, the house brand is not a side project; it is the business. The advantage is margin and control: Kohl's sets the price, the quality and the look, and it is not bidding against a marketplace for the customer's attention.
The risk is the same as the reward. A private-label-heavy mix lives or dies on taste. When the in-house design hits, the margin funds everything else; when it misses, the customer has no national brand to fall back on. Kohl's has spent 2026 defending the middle by making its owned labels feel like a reason to visit, not a discount bin.
Why the Middle Is Worth Defending
The temptation in 2026 is to assume the middle collapsed. It did not โ it fragmented. Shoppers trade down to Ross for a thrill, up to a premium DTC label for a story, and sideways to Amazon for speed. The department store's job is to be the place that still feels like a destination for a full outfit at a reasonable price. Both Macy's and Kohl's are betting that physical stores, when edited tightly, do something a feed cannot: let a customer see, touch and trust a garment before she buys.
The off-price wave sharpened this imperative. As Ross and TJX pull the value shopper, the department store cannot win a price war and should not try. Its edge is the opposite: a curated floor where the national brand and the house brand sit side by side, and a sales associate can explain the difference. That human layer is expensive, which is exactly why Macy's is pruning doors instead of diluting it โ fewer, better stores beat many mediocre ones.
Kohl's faces the mirror image. With roughly 45% of sales in owned labels, its risk is sameness โ if the house brand drifts from customer taste, there is no national-label safety net. The 2026 play has been to keep those labels feeling current and to use loyal-customer data to decide what to make, a closed loop a marketplace cannot replicate.
The Lesson for an Independent Label
Two takeaways travel. One: a private label is only as strong as its design discipline โ Kohl's 45% share is a warning and a playbook. Two: curation beats infinity. Macy's decision to lead with a few premium national brands, rather than echo Amazon's everything-aisle, is why its remodeled stores outperform. For a smaller brand, the parallel is to partner and to edit ruthlessly. When you list a bestseller, make it earn the spot; when you build a two-piece set, design the coordination so the customer does not have to. Curation is a competitive moat a marketplace structurally struggles to copy.
Frequently asked questions
Are department stores still relevant in 2026?
Yes, but smaller and sharper. Macy's is about 80% through closing 150 stores and its remodeled "Reimagine" locations outperform the fleet, while leaning on premium national brands for differentiation against Amazon.
How dependent is Kohl's on private-label apparel?
Heavily โ owned apparel is roughly 45% of Kohl's sales, versus about 1% for Amazon and 52% for JCPenney. For Kohl's the house brand is central to margin and assortment control.
Why does curation beat an endless assortment?
A tight, edited mix lets a customer trust the buy and see a full outfit in one place. Macy's leads with a few premium national brands rather than echoing Amazon's infinite shelf, which is why its better stores outperform.
What can a small brand learn from the house-brand fightback?
Protect design discipline and curate hard. Every listed piece should earn its place, and coordinated sets should do the styling work for the customer โ things a marketplace structurally struggles to replicate.
Sources
Figures in this article are cited from the following published sources:
- Similarweb โ The Largest Retailers in the US, By Category (H1 2026)
- Jungle Scout (via Maideyi) โ Amazon Private Label Brands Analysis (Kohl's / JCPenney private-label share)
- Retail Dive โ Department Stores Coverage (Macy's Reimagine, store closures)
