The media has spotlighted a slew of retailers that are facing hardships. Store closures, sales declines and re-branding all have plagued several merchants across categories. Below, Retail TouchPoints editors spotlight one retailer they have seen in the media recently, and their hopes for the brands moving forward.
Debbie Hauss, Editor-in-Chief: I think Build-A-Bear Workshop is generally on the right track with its current updated focus, but it has a long way to go. The retailer recently introduced a new store concept, built around more digital engagement with its young customers who are focused on using smartphones and tablets. Of the total 400 stores in the chain, approximately 60 under-performing stores are in the process of closing down. Launched in 1997, Build-A-Bear was extremely profitable through 2007, then the recession hit, taking a toll on the experience-oriented merchant. Profits continued to decline until the re-focus and store revamp started to take hold. I wish the best for Build-A-Bear, as the primarily mall-based merchant struggles to build itself back up while contending with declining mall traffic.
Alicia Fiorletta, Senior Editor: The news headlines are very real and very sad for American Apparel. Yes, 2013 was an awful year for the brand and retailer. Although net sales increased 3% over 2012, pre-tax earnings dropped dramatically from $36.6 million in 2012, to up to $9 million in 2013. Ouch. Net loss will reach up to $122.1 million, compared with a $37.2 million net loss for 2012. American Apparel CEO Dov Charney noted that this loss could be attributed to production and a new distribution center. However, I can’t help but think the brand’s recent slew of bad press has something to do with it. Sure, American Apparel has always lived by the mantra “all press is good press,” but its recent ad featuring a former Muslim woman topless with “MADE IN BANGLADESH” written over her chest is getting folks talking for all the wrong reasons. Rather than concisely honing in on its “made in America,” ethical production principles, the brand is merely hinging on controversy to gain media attention. And don’t even get me started on the mannequins with pubic hair. However, I will say I thoroughly enjoyed the fact that American Apparel hired a 62 year old woman to model its apparel and lingerie. I hope the brand refocuses on getting its principles out to the public in a fun yet concise way. These include: fashion has no age or gender boundaries, the importance of social responsibility and the value of supporting local businesses and your fellow man. According to recent reports from the Wall Street Journal, American Apparel has brought in lawyers from Skadden, Arps, Slate, Meagher & Flom in light of weak sales and ongoing debt to help turn the brand around. Apparently, the retailer has avoided bankruptcy several times in the past. Here’s hoping the company stays afloat.
Kim Zimmermann, Managing Editor: I did like RadioShack’s Super Bowl commercial (I am a child of the 80s), and the best thing they could do would be to follow through with the concept. I’d like to see them become more like Apple stores and maybe even have their own version of the Genius bar. While the Apple Genius bar is great, it is obviously only for Apple users. How about some geniuses to help out those of us who don’t have an iPhone and iPad? Even with the closing of 1,100 stores, they will still have roughly 3,400 locations. That’s a lot of real estate. The new tag line — “It Can Be Done, When We Do It Together” — could work if they take it seriously.
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Glenn Taylor, Associate Editor: With the closing of more than 200 stores in addition to a new marketing campaign, Staples is well on its way into a brand shift. The retailer is doing something right online, particularly in North America, where sales grew 10% in 2013. This boost was spearheaded by an expansion of the online inventory, which saw the amount of available products increase from 100,000 to 500,000. I like what they’re doing with this, only because it sets them up with a model similar to Amazon. However, I think the catch-all approach does very little to stand out, so personalization is going to have to be leveraged in order to attract different kinds of business owners and individual consumers. If Staples can find a way to cater to restaurant owners and law firm partners via personalized product interfaces, for example, (as opposed to traditional store departments) the retailer could relate to specific businesses in a way Amazon hasn’t capitalized on yet.
Brian Anderson, Associate Editor: We have seen Macy’s refocus its efforts on the online channel at the expense of 2,500 employees and five store locations. The one thing I wish the retailer doesn’t do is focus too much on this one channel in particular. Instead, I’d like Macy’s to focus on creating a continuous experience across all touch points. I’m sure that a 150-year-old retailer is capable of handling a change in strategy, but what I’m hoping to see is some innovation on how the company integrates both the online and in-store channels in order enhance the customer shopping experience altogether. By boosting its M.O.M. strategy — which includes localization and omnichannel capabilities — I feel Macy’s is more than qualified to begin offering a seamless experience across all possible channels with very minimal negative repercussions.
