Zeller is back. Can retro branding survive in today’s retail landscape?
The day nostalgic Canadian shoppers have been waiting for has arrived: Zellers Department stores are back – kind of.
Hudson’s Bay Co locations. in Ontario and Alberta officially launched their Zellers pop-up experiences on Thursday, some complete with visits from a food truck outfitted with classic recipes from home family favorite Zellers.
The brand also launched its e-commerce platform on Thursday.
Zellers-branded hoodies are sold alongside other clothing and homeware items inside the stores.
Zellers are back in Calgary
However, on the first day of online sales, some items, including the red hoodie, appeared to be out of stock. There were already long lines for the Zellers Diner at Edmonton’s Kingsway Mall, with several menu items sold out, prompting the brand to announce that the best-selling restaurant would reopen. again on monday on friday.
Retail experts say the return of the discount brand is well-suited to today’s inflationary era, but the Zellers’ return story may prove less of a department store resurgence and more of a resurgence. was their last gasp.
Zellers, owned by HBC since 1978, largely moved out of shopping malls and independent stores a decade ago when US-based Target took over its stores amid a growing market crisis. Canadian school was briefly attacked.
The relaunch comes with an online store and 10,000 square feet of retail space inside existing HBCs, with 12 of the first 25 launching in-store experiences on March 23.
Hudson’s Bay Co. spokeswoman Tiffany Bourre told The Canadian Press that further store openings would be done in phases and the retailer did not rule out the possibility of independent locations.
Joe Aversa, an associate professor of retail management at Toronto Metropolitan University, said that after disappearing from the Canadian shopper psyche for years, the Zellers brand has built up a bit of “nostalgia”.
That could leave consumers eager to recapture some of those retail memories at the mall in the coming days, he said, driving traffic to Zellers, HBC and surrounding stores.
Aversa told Global News: “I think there will probably be a honeymoon phase.
Aversa said HBC’s pop-up approach to relaunching Zellers is “safer” than bringing back stores with a lasting mark, as brand owners can “make a mark”. price” interest in the return without having to commit extra space.
“They’re looking for a way to get attention and get people to come back to those big places. I think that might say more about how they’re trying to find new ways to reinvent their existing space,” he said.
Retail author and analyst Bruce Winder agrees that Zellers will be “the news” in the coming days and that could provide a sales boost for HBC in the short term, but in the long run, he’s not sure Canadians will become regular shoppers at the resurgent retailer.
“They can buy a Zellers shirt or something like that. But my concern is, next week, the week after that, when the rumors have subsided, is this a viable business venture?”
Winder told Global News he doesn’t see nostalgia as a retailer’s “sustainable competitive advantage.”
“The only thing that can help them is if for some reason it gets hot, like (if) it’s fashionable to wear a Zellers sweatshirt. Then they might get lucky like that. But actually, you know, I don’t think it’s going to translate into sales,” he said.
Zellers return, but will it last?
Zellers make a comeback as inflation pushes consumers to lower retail prices
However, both Winder and Aversa say today’s retail environment is ripe for a discount brand to appeal to Canadians.
While inflation has shown signs of cooling down in recent months, a year of skyrocketing prices and rising interest rates has eaten away at the disposable income of many households.
Retailers like Dollarama and Walmart have seen their discount business boom during this time, and Aversa said he sees more opportunities for other low-end retailers to compete in the market. that market segment.
“In my opinion, there’s definitely space for another discount chain,” Aversa said, before adding, “I just don’t know if Zellers is necessarily that chain.”
Winder is also uncertain that Zellers will be able to create a niche of its own to lure shoppers away from established retailers like Walmart.
While the “lowest price is the law” tagline is more in line with Zellers’ earlier iteration, Winder says that today the brand is targeting more at mid-priced, somewhere across products. Dollarama product.
While he says he hopes Zellers succeeds and provides an affordable alternative for shoppers to increase competition in the space, he doesn’t believe the experiment has any power. what persistence.
“I’m really not sure they have anything that would draw consumers to them right now. I may be wrong, I’ve been wrong in the past, but my heart tells me how this is going to work out,” Winder said.
Department stores don’t attract customers like they used to
The return of Zellers comes the same week that another department store chain, US-based luxury brand Nordstrom, started liquidation sales after announcing earlier this month that it was leaving out of the Canadian market, leaving gaps in shopping centers around the country.
While Winder said that the exit from Nordstrom had caused a “shock wave” in the retail sector, he said the store closures in Canada had more to do with Nordstrom itself than with the market.
Winder said luxury brands have performed well despite times of high inflation, with affluent consumers less affected by rising prices and higher interest rates.
Liquidation sales at Nordstrom in Vancouver begin but some people are disappointed by the discount
He argued that Nordstrom may have “over-expanded” in Canada, quickly rolling out more than a dozen locations and learning that Canadian shoppers don’t equate to Americans. However, that perception could make other international retailers hesitant about expanding into Canada and filling the gaps left by Nordstrom in malls.
“There will be international retailers that can rethink Canada,” says Winder.
Although the two retailers serve different markets, Aversa believes Nordstrom’s departure has more to do with the category it and Zellers share – the one-stop department store model that thrived in the era post-World War II period.
In the 1960s and 1970s, he said, department stores were “the quintessential factor that would drive traffic” to a shopping mall.
“If you look at department stores overall, they’ve had better days,” says Aversa. “They don’t generate the kind of traffic they used to. And it has had an effect on malls.”
How Nordstrom’s departure will affect Canada’s retail landscape
With the advent of e-commerce and no shortage of choices about where to spend their scarce money, today’s shoppers can “decide” more on what they want from stores, Aversa said. than before.
This means that malls are increasingly turning to “experiential” and “unique” offerings to engage customers, he said – Zellers’ pop-up experience is the latest example.
Despite Nordstrom’s departure and skepticism that the Zellers will make for a lasting comeback story, neither Winder nor Aversa are too sour on the mall’s prospects.
Nordstrom is closed in Canada. What will fill the big shopping mall vacancies left behind?
Winder expects Nordstrom’s soon-to-be-empty storefronts to eventually be filled with entertainment-focused service or by breaking it up into smaller stores while international retailers remain “cautious.” on the Canadian market, Winder expects.
“These are great points. They are targeting high-end consumers,” he said. “There will be a lot of profit if you find the right tenant.”
– with files from the Canadian Press