What: The founding family-run department store has demonstrated a successful approach to retailing that contrasts its competitors such as Macy’s, JCPenney and Kohl’s.

Why it is important: No retailer is immune to the downturn in discretionary spending; however, Dillard’s approach in combination with its older and wealthier customers may help sustain growth despite inflation.

While their customer base may be less affected by inflation, the company also lacks intervention from activist investors pressuring to monetize their real estate, spin off their e-commerce operations, shake up the board or even put the business up for sale as is the case for comparative publicly traded department stores.

In addition, Dillard’s approaches private labels and exclusive partnerships differently. The department store has 52 owned brands or exclusive brand partnerships in women’s, men’s, children’s and home. Strong brands that are difficult to find are a key differentiator for Dillard’s. Traditionally, they believe, most department stores carry the same brands and products leading to a price battle which becomes the only differentiating factor in the customer’s mind. Thus, Dillard’s focuses on limited distribution and higher profile brands to reach customers who value fashion over price.

The department store still needs to balance its traditional values while reaching younger consumers and building its online sales. Some analysts predict Dillard’s will continue to have a soft growth period through the spending downturn.

Dillard’s differentiates through exclusivity not price