Jim Cramer: Macy's, Kohl's 'have never felt more irrelevant'

• CNBC's Jim Cramer says department stores such as Macy's and Kohl's "have never felt more irrelevant."
• "Now these troubled retailers can't afford to offer the same level of customer service they used to. Sometimes they have long lines, sloppy aisles, empty registers," the "Mad Money" host says.
• "The problem for Macy's and Kohl's and Nordstrom is that all of these trends are accelerating, meaning their position gets worse and worse with every passing year," he says.

Department stores "have never felt more irrelevant," CNBC's Jim Cramer said Monday.

Consumers are finding it easier to shop for better prices from their cellphones, and retailers such as Macy's and Kohl's are finding it harder to staff their stores, especially during this holiday shopping season, the "Mad Money" host said.

"Now these troubled retailers can't afford to offer the same level of customer service they used to. Sometimes they have long lines, sloppy aisles, empty registers," he said. "These are all common complaints about most of the mall-based department stores that I read online. They can't afford to be run efficiently."

While Walmart and Target made the right digital investments to stave off pressure from the likes of Amazon and other web-based retailers, Macy's and Kohl's "have lots of uniquely self-inflicted wounds" outside of the e-commerce disruptors, Cramer said.

The department chains failed to bolster their digital platforms enough or install the right strategies to lure customers inside their stores, Cramer said, adding that improved delivery services are making it easier for consumers to try on clothes in the privacy of their own homes — rather than using in-store dressing rooms — and return items that they don't want.

"The problem for Macy's and Kohl's and Nordstrom is that all of these trends are accelerating, meaning their position gets worse and worse with every passing year," he said.

Furthermore, market values of Macy's and Kohl's have fallen double digits, despite both companies taking on debt to fund huge buyback programs over the years, Cramer said. Kohl's has $7.8 billion of market capitalization, and Macy's has $4.8 billion.

"They'd have been better off if they just sat on that money," he said. "They'd be much better off if they spent it on building out their online capabilities."

Disclosure: Cramer's charitable trust own shares of Amazon.com.

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