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Doretta Wilson has little patience with department stores, preferring to comb the racks at Winners for deals or splurge on a classic outfit at Talbots. But she has heard the buzz about the Bay's relaunch of the Room as a high-fashion hub, and is keen to check it out.

It has been two decades since she bought anything from what was formerly called the St. Regis Room, a boutique at the Bay's Toronto flagship. “It used to be the shopping destination for the who's who of Toronto society,” says Wilson, 54. “The Room in its heyday was elegant and special.”

Now, Bonnie Brooks, the Bay's chief executive officer, is hoping that this week's reopening will help woo back her target shoppers. They're mostly female, aged 35 to 59, have disposable income – and need her wares, even in hard times.

“That's the sweet spot of spending – and spending on more fashionable, better-quality merchandise,” says Arthur Fleischmann, president of John St., the Bay's ad agency.

“They're professional or quasi-professional women – they're the ones who need clothing and they've got the money to spend on it.”

But department stores today have an uphill battle: Wilson, an education policy administrator, is part of a generation of consumers who have largely abandoned one-stop shopping in favour of specialty stores such as Banana Republic or discount chains such as Wal-Mart or Winners.

The collapse has been dramatic. With just two traditional national chains remaining – the Bay and Sears Canada, with 214 locations between them – department-store sales make up a mere 4 per cent of the $200-billion in annual Canadian retail sales (excluding auto sales).

That's down from about 60 per cent in the 1950s, according to Paul McElhone, executive director of the University of Alberta's School of Retail in Edmonton. Gone are names such as Eaton's, Woodward's and Simpson's, where the Room was started 72 years ago (before that chain was swallowed by the Bay).

“Consumers today are shopping in all sorts of formats,” McElhone says. “They're buying their Armani suits from Harry Rosen and Holt's, they're buying their socks and underwear from Costco and they're buying their party favours, cards and candles from the dollar store.”

Mark Cohen, a former chief executive officer of Sears Canada and now a professor at the Columbia University Graduate School of Business in New York, is even more blunt about the state of department stores. “They are the dinosaurs in the room who don't have much of a future, although some will linger,” he says. “The customer has enormous alternatives in every category you can think of.”

But both the Bay and Sears are scrambling to borrow a page from some of their savvier U.S. counterparts, aiming to lure back 30-to-50somethings by upping the fashion quotient. Like the Bay, Sears is dropping older-skewed labels. It no longer stocks Louben, but recently added the hip B.C. label Mac & Jac as well as private label Attitude, which was previously sold at Eaton's and is aimed at 30-to-40-year-olds. Its Jessica house brand, a cornerstone of its women's business, is being repositioned to cater to the 40-plus woman.

Sears is even stepping onto the runway next week, participating for the first time in Toronto Fashion Week, with its Attitude collection.

“It's a work in progress,” says Sarena Campbell, vice-president of apparel at Sears and a veteran fashion merchandiser who was recruited last October. “This is just the beginning of where we want to take Sears in the future.”

Sears still hasn't reached Calgary's Catherina Blaker, who considers the retailer her mother's store. But Blaker, a 36-year-old mother of two small children, recently ventured into the Bay after seeing full-page ads for its new fashion labels, including Lauren by Ralph Lauren. She doesn't generally shop at department stores, but she was curious about the changes.

What she found was a Bay store less cluttered and congested than in the past. But its fashion offerings were pretty slim, she says. They still weren't up to the standards of Nordstrom, her favourite U.S. department store. “We never had our own Nordstrom,” she says. “But it seems that the Bay is starting to go that way.

“Most people I know [who] are looking for something specific would go to that specific type of store: If we're looking for shoes, we would go to a shoe store. The same with clothes. I would just know that I would have good luck there. When I do go to a department store, I might find it and I might not. It's hit and miss.”

To draw customers like Blaker, the chains are using innovative marketing techniques: Brooks herself is starring in radio ads for the Bay to usher in its new brands and bringing designers into the stores to trumpet their wares; Sears is pitching Attitude in magazine ads and on a micro-site and Facebook page.

As their strategies evolve, the two Canadian chains are becoming more clearly differentiated from one another. Under Brooks, an executive with international fashion retailing cred, the Bay is focusing more on designer fashion, filling what it sees as a gap between Holt Renfrew's nine luxury stores and mid-priced Sears. At the same time, Brooks is including recessionista-friendly lines that have recently been introduced by high-end labels. They include T Tahari, BCBGeneration and DKNYC.

The Bay is also expanding its handbags, shoes, cosmetics and contemporary-apparel sections, while shrinking slower-moving appliances, furniture and home decor. The revamped Room “provides the halo that can benefit the whole company, from a fashion perspective,” Brooks says. “It clearly sets us apart from any other department store in Canada.”

Sears, in contrast, is using fashion as just one pillar in what is essentially a traditional department-store model. It's beefing up its electronics and trumpeting its well-recognized Kenmore appliances and Craftsman tools. “We're almost a one-stop shopping place,” Campbell notes.

The risk for both chains is that consumers will get confused by all the shifts and head elsewhere, McElhone says.

Even executives at parent Hudson's Bay Co. acknowledge among themselves that their biggest hurdle is not so much the soft economy, but persuading a new generation to shop in department stores, sources say.

Cohen questions the reliance on fashion, pointing out that apparel, as a discretionary purchase, is the first to be shed in an economic downturn. As well, department stores draw an older crowd that is less likely in general to spend on clothing.

But baby boomers such as Wilson may be ready to shell out a little more on themselves without breaking their bank. “I love the fact that they're bringing back the Room,” she says of the Bay. “But they have a long way to go.”

The Room now

The Room today is all about lightness: whites, creams and pale greys, screens of polished silver squares and frosted acrylic blocks, silvery mobiles of flowers and birds – and natural light streaming in from windows.

After a $5-million makeover by top design firm Yabu Pushelberg, it has been expanded fivefold to 21,500 square feet on the third floor of the Queen Street flagship store. (Versions are also planned for Montreal and Vancouver.)

Today's Room is a stark contrast to the black and beige of its 72-year-old predecessor. Called the St. Regis Room, it was a destination for the well-heeled in Canada in its heyday and helped introduce the country to such brands as Yves Saint Laurent, Courreges and Oscar de la Renta.

The current incarnation has set its sights just as high: Featuring some of the priciest designer fashions in the country, it includes handbags, jewellery and footwear and features almost 70 brands, up from just a dozen previously. Among its new offerings are a few (Halston, Balmain, Proenza Schouler) unavailable elsewhere in Canada.

You'll also find generous change rooms, a concierge who can book hair appointments and restaurant reservations and a VIP lounge to have a glass of bubbly and dish. Now that's progress.

Marina Strauss

Your stories

We asked readers to share their memories of the Room. Here are some of our favourites.

I’m too young to have shopped at the Room and my mother could only wish but my grandmother worked in the Room. Ella was born in England, the proud daughter of a wealthy wool merchant who immigrated with the family to Canada in 1907. My grandmother was a society lady until, during the Second World War, she lost my grandfather. With three young sons to raise, she went to work at Simpson’s, although she would never call it Simpson’s. She simply said she worked in the Room. Even though I was young I knew it had capital letters. She took me once and while I can’t describe the clothes or the decor, I do remember the feeling I had. It was rather like church. I swallowed my gum and sat with my ankles crossed. She was very proud to have been chosen as a saleslady in The Room. No other job would have suited her.

Micki Ruth

Too many years ago, I was a blushing bride and the only place to accessorize yourself was at the Room. My mother decided that we would use a wedding planner from there. This lovely woman met me in a private salon, gave me sage advice on what and what not to do and immediately set to work making me and my event perfect. She was at the house the day of the wedding with a bag of needles, thread, Band Aids, plastic bags (a must for feet when it is raining outside) and a professional calmness. The Room was all about style and service. It sounds stuffy but it was an oasis.

Carolyn Clark Rabbior

I worked there in 1983 as a part-time salesperson and I have some great memories of the ladies who wrapped and boxed everything just so – that was their full-time job and they spent the entire day in a windowless room, hidden from the customers. When I applied for the job, I had two acceptable outfits to my name. Both were peplum-jacketed suits, sewn from the same pattern. Thanks to the Room’s discount area, I found a Wayne Clark halter top of emerald green silk and a long satin skirt. I still have them.

Angela Murphy

I used to visit the Room at Simpson’s in Ottawa. My fondest memory (and biggest regret) is the time I walked in in the early seventies and tried on a winter coat (I am still surprised they actually let me in, much less try on a coat). It was a reversible mink-lined trench coat, warm and waterproof. It was priced at $700 and I had a $1,100 student loan cheque in my pocket. I still remember how tempted I was to buy the coat, but decided it was better to use the money for tuition.

Anna Jaworski

Tea and cucumber sandwiches were only part of the wonderful service at the Room. The dressing rooms were enormous by today’s standards. The attention was very personal with the staff telling you, in no uncertain terms, that an outfit was not flattering, no matter how much you loved it. They would also keep track of who bought what and tell you where they planned to wear it so that if you showed up at a big event you would not see someone else in the same dress. Only Creeds delivered the same level of service.

A dress my mother purchased in Florida for my first appearance at the Bat Ball at Upper Canada College failed to arrive in time. My parents remained in Florida. I had to return alone with no dress, which had all the makings of a tragedy in my 15-year-old imagination. My mother called the Room and they had a dress delivered from Montreal. When I went down to try it on, everyone was quick to tell me that it was just right and that it would be a hit. I was not sure. I had to stand at the head of the receiving line with the headmaster and his wife. It all went well. My date fell in love with me and I made Zena Cherry’s column.

Elizabeth S. Brinton

My mom would always give me little tips on fashion when we were in the Room. Her famous line to me was “simplicity is the height of fashion - just look around in this room." My greatest memory was a few years later when my friend and I were allowed to venture to the city on our own to Christmas shop. I knew exactly where I was going to buy my mom's gift - the Room. We carefully looked around and there it was, a simple black lace apron with silver sparkles - its sash was black satin - perfect for entertaining around the holidays. The cost was almost $10, but my mom had to have that apron; after all the label did say "The Room." My mother loved her gift and used it regularly for over 40 years. It was really quite useless as an apron, but it looked good and my mom liked things that looked good. I guess that is why we always kept going back to the Room. Things just looked good.

Adrienne Winslow (daughter of the late Gladys Morris)

While I never shopped at the room, my mother did, and I was a little boy who thought that their brown boxes made great buildings for my matchbox car world on the living room rug. The boxes had this neat detail on the lid that looked just like a row of windows: great long industrial buildings with windows at the top. Let's hope that for the next generation of kids, they bring back those cool boxes.

M. Scrivener