Will this year’s Zellers relaunch be a success?
Posted January 12, 2023 7:19 am.
If you’re in the market for a $6 kettle or enjoy the smell of gravy while shopping in a department store, a one-time big-name low-cost retailer is making a comeback.
Zellers continues teasing it’s re-entering the market very soon, although an exact date has not been announced yet, and there are questions about whether this will be a success.
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At a time when the cost of living and inflation remain out of control, Retail Advisor David Ian Gray with DIG360 says the timing is perfect.
“From a marketing point of view, it will probably be successful. If it’s about building a rebirth of a brand or chain, there’s a lot of barriers in place there to overcome before that would be a success and I have my doubts.”
He explains if they’re going to try and take advantage of people being nostalgic — it simply won’t be enough.
“That nostalgia will probably resonate most with Boomers who typically are not the big spenders in retail. If we go to Gen X or so, they may remember there was a Zellers, but the recollection was when it was in its long decline, and it was so poised for Walmart to knock it off its perch as the discounter in Canada. People like nostalgia but they like to talk about nostalgia, whether they buy nostalgia is a whole other question.”
He doesn’t think Zellers re-opening will worry stores like Walmart or any dollar stores. Price points for Zellers haven’t been released but Gray thinks it’ll be comparable to Walmart.
Gray says the focus for all retailers right now is on value.
“The last year into the next few years [is] being at the discount end of the spectrum with value, not necessarily cheap and poor quality, but value is a great safe play for retail right now. Consumers are already tightening their spending.”
When Zellers resurfaces it will be in the form of in-store in The Bay and online. Gray says Hudson’s Bay Company picking this up is a smart move as it’s long been documented the Canadian retailer has struggled financially and needs to freshen things up.
“It’s an interesting, creative move. I think right now I’m going to treat it as a good marketing move. Whether it’s a business model that can catch on and have a life of its own, contributing to the Hudson Bay bottom line in a meaningful way — we’ll see how that plays out.”
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Whether this opens the doors for other stores to make comebacks, Gray says unless they can put the energy and money into making it a success, it’s not likely. He also doesn’t feel there’s a gap in the market right now that stores need to continue re-launching, especially when there are big online names like Amazon saturating the market.
There’s no word on the restaurant in Zellers re-opening. The discount retailer closed its doors in 2013.
