2018 was the year that many iconic retail brands went bankrupt:
Toys R Us
And most recently Gymboree and Payless Shoes
A few weeks back Tru Kids, the new parent company of Toys R Us, announced its plan to pursue e-commerce sales while focusing on technology, in-store customer experience and customer service to revive the iconic toy brand. Leveraging off the brand equity of Toys R Us/Baby’s R Us, the former executives are confident that their new business plan will solve the problems of old that resulted in the retailer’s demise.
Does this strategy sound familiar?
Does it remind you of Circuit City, Sears and RadioShack?
Nostalgia is the Private Equity’s Achilles heel. These failed brands invoke childhood memories in many of us. Going to the neighborhood RadioShack to buy a co-axial adapter. The yearly back to school shopping at Sears. Buying that console TV at Circuit City.
Unfortunately, these retail brands no longer hold intangible value.
Omnichannel marketing, BOPIS (Buy Online Pick Up in Store) and online product searches dominate shopping behavior. Large floorplans and one stop shopping are days of the past. Shoppers are retailer agnostic.
Resurrecting these retail brands with the focus of what successful retailers have been doing for years, while relying on past brand equity to spur sales is destined to be a failure.
Retail has evolved. It’s time to lay these brands to rest.