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What do you think will be the next Big Box to go under will be?
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- mikka2017
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- Jan 12, 2017
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- Scarberia
- playnicee1
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If it ain't broke, don't fix it!
- Cas77
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They could offer groupons for 95% off and still make a killing. This market segment's budget allocation is 99% marketing 1% product. Don't cost much in oil, water, coloring and scented oil to make a bar of soap with a $5 price tag on it. How much raw material do you think goes into a bottle of $60 cologne? What about filling a flat 1" x 1" box of clay/silica/cornstarch?EastGTARedFlagger wrote: ↑ Definitely can also include Sephora and Clair de Lune to that mix.
That market is overdue for a correction. A year or so ago I recall Body Shop sold GROUPONS to get people into their stores. A good clue of a failing business is when a store/restaurant that's been around for years suddenly gets into Groupon, since businesses that use those take a huge hit*. Groupons are fine for a new company trying to drum up business by getting you in the door. It's another story altogether when a business that's been successful for a quarter century does it. I'm surprised they're still around.
However, walking through my local mall over Boxing Week, one of the longest lineups to get into a store was at Lush. So somebody's buying that overpriced useless crap.
Frankly I don't get it. It's not like you can't get similar products at Walmart that work just as well. Or just go to the back tables at Winners and you'll see overstock of those products being liquidated. Loblaws could crush that segment into oblivion if they wanted - they have the drugstores (Shoppers) and a bunch of super/hypermarkets with inhouse pharmacies, plus a rewards program. All they gotta do is lower prices bigtime.
* Most Groupons are 50% off regular prices. However Groupon keeps half of what you paid for the voucher. So if you paid $50 to get a $100 voucher, that store is only pocketing $25 for you to get $100 in merchandise/food. Any business that relies on Groupon for foot traffic either has crazy markups ... or is already on its way to closure.
They have surprisingly little inventory to move to be very profitable...and are all backed by a centralized corporate marketing machine doing the work...that's why they're taking up 60% of any modern mall floor space and keep popping up like dandelion whenever another chain closes.
Last edited by Cas77 on Jan 31st, 2018 4:04 pm, edited 1 time in total.
- Simby
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- Sep 8, 2006
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- Edmonton
The article talks about Sak's off 5th doing poorly, not Sak's on 5th. Sak's off 5th sells designer brands at a discount, a mixture of Bay and some higher end brands. It's like a high end Marshalls. This store is more for the middle class in the context of this example.
Sak's on 5th sells the higher end designer brands, targeting the upper class.
- skeet50
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- Jan 15, 2017
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The Bay will be around for a few more years. It has lots of value in its real estate holdings that it can use to prop up the retail stores.
The Bay has lost sight of its key business. It's key performance indicators of its floor staff are the number of emails they collect, the number of credit applications they collect and the number of online orders they process. You work there and can sell, sell, sell all you want but your manager will want to know how many emails and credit apps you collected. Is there any wonder that sales continue to decline?
The Bay has lost sight of its key business. It's key performance indicators of its floor staff are the number of emails they collect, the number of credit applications they collect and the number of online orders they process. You work there and can sell, sell, sell all you want but your manager will want to know how many emails and credit apps you collected. Is there any wonder that sales continue to decline?
- EastGTARedFlagger
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Exactly why a big retailer with billions in the war chest like Loblaws could crush all those small fry in short order by selling identical soap, bath bombs, aromatherapy, bubble bath, etc at 60% off those prices. Sell that $5 soap (that cost 10 cents to make) for $2, with some bonus PC Points for good measure.Cas77 wrote: ↑ They could offer groupons for 95% off and still make a killing. This market segment's budget allocation is 99% marketing 1% product. Don't cost much in oil, water, coloring and scented oil to make a bar of soap with a $5 price tag on it. How much raw material do you think goes into a bottle of $60 cologne? What about filling a flat 1" x 1" box of clay/silica/cornstarch?
They have surprisingly little inventory to move to be very profitable...and are all backed by a centralized corporate marketing machine doing the work...that's why they're taking up 60% of any modern mall floor space and keep popping up like dandelion whenever another chain closes.
Last edited by EastGTARedFlagger on Jan 31st, 2018 5:30 pm, edited 1 time in total.
- EastGTARedFlagger
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- Feb 22, 2016
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I guess you can keep repeating that every few months and MAYBE 20 years from now you can finally come back to rub it in my face that you're right.
Until then, dream on... You're telling me Toys R Us will outlast Best Buy? Good luck with that.
- fryguy1987
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- Jan 3, 2017
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Well your point might be valid and perhaps one day I would rub it in your face after repeating it every few months except for one small little detail.EastGTARedFlagger wrote: ↑ I guess you can keep repeating that every few months and MAYBE 20 years from now you can finally come back to rub it in my face that you're right.
Until then, dream on... You're telling me Toys R Us will outlive them? Good luck with that.
I don't think I've ever mentioned it anywhere that I think Best Buy would be the next chain to go under, let alone repeat it every few months. I'm pretty sure this is the first time ever that I've ever said anything negative about Best Buy in any forum and the reason that I did even mention it this time was I happened to read this topic one day after finally getting fed up with Best Buy after another terrible shopping experience and the two happened two coincide .
- EP32k2
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- Jan 15, 2006
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What's wrong with their credit card as part of the KPI? HBC credit card actually makes them money, why do you think all retailers are trying to sell you one? It's a product that literally costs them nothing, they don't have to worry about distribution, merchandising etc.skeet50 wrote: ↑ The Bay will be around for a few more years. It has lots of value in its real estate holdings that it can use to prop up the retail stores.
The Bay has lost sight of its key business. It's key performance indicators of its floor staff are the number of emails they collect, the number of credit applications they collect and the number of online orders they process. You work there and can sell, sell, sell all you want but your manager will want to know how many emails and credit apps you collected. Is there any wonder that sales continue to decline?
As for emails. My mother is retired and has nothing but time. Every time she gets a HBC email with promos she heads over there...
Having worked in retail for 17 years this is the direction that everyone is going, so no they haven't lost sight.
- skeet50
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They are a retail business - not a credit granting business. Having sales associates focused on selling credit applications and not the stock that is in front of them is losing sight of its core business. The credit card is simply an add-on.EP32k2 wrote: ↑ What's wrong with their credit card as part of the KPI? HBC credit card actually makes them money, why do you think all retailers are trying to sell you one? It's a product that literally costs them nothing, they don't have to worry about distribution, merchandising etc.
As for emails. My mother is retired and has nothing but time. Every time she gets a HBC email with promos she heads over there...
Having worked in retail for 17 years this is the direction that everyone is going, so no they haven't lost sight.
As for emails, the whole point of collecting emails is to build a database for marketing purposes. Once you have the person in the store, your goal should be on sales, not on finding ways to market to them. Your customer is in front of you so stop advertising to them and start selling.
I agree with you that other retailers are going in this direction. It's also one of the main reasons that so many retailers are facing difficulty right now.
- gomashio
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- Feb 1, 2018
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EastGTARedFlagger wrote: ↑ Not that I buy the stuff but I'm sure most of the equivalent products sold by Loblaws/Shoppers are also marked "not tested on animals" in the fine print.
- EastGTARedFlagger
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PETA (that's who that is) lost all credibility by including IAMS in there. That logo jumped out at me. They make PET FOOD. How the hell would you test it, feed it to kindergarten kids?
Would I expect any less from PETA?
And again, who's to say Loblaws can't come up with their own line of "PC Humane" skin care products (and maybe pay the SPCA to put their seal of approval on the packages) to undercut Body Shop and Lush? That's what I was saying.
- mbg
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I'm not sure this has been true for a long time. At least 20 years ago, stores began shifting from "selling people things they need" to "selling a bunch of stuff as an excuse for people to buy it on credit" because the profit margin on financial services is so much higher.
I think they had to do this, because price competition didn't leave much else to work with. People stopped buying quality, more expensive things that had healthy profit margins embedded in them as they switched over to the lesser-quality, volume-driven products that most people complain about but most people preferred over higher-quality products that had a decent margin built in.
The only way those products work for the manufacturers is if you keep having to buy the same thing over and over again (planned obsolescence), and the only way it works for the retailer is if they can make money on services or other things related to the sale.
WalMart and Amazon are in a different category, I think - they have generally found a way to make money off high-volume in all categories - mainly with very efficient operations - similar to how supermarkets have to behave with food.
WalMart killed off so many retailers because of their highly-efficient computerized systems. Canadian Tire was very good at this as well. Amazon has one-upped them. Anyone who wants to be competitive now is upgrading their infrastructure to make warehousing and delivery more efficient.
- gomashio
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When searching for the image, I purposely picked one that didn't say "PETA" because I KNEW someone would immediately discredit it just because.EastGTARedFlagger wrote: ↑ PETA (that's who that is) lost all credibility by including IAMS in there. That logo jumped out at me. They make PET FOOD. How the hell would you test it, feed it to kindergarten kids?
Would I expect any less from PETA?
Sorry, I thought you were just referring to body products in general, hence my reply.EastGTARedFlagger wrote: ↑ And again, who's to say Loblaws can't come up with their own line of "PC Humane" skin care products (and maybe pay the SPCA to put their seal of approval on the packages) to undercut Body Shop and Lush? That's what I was saying.
- bluebellrose
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Tell them that lol. They pay the cashiers 2.50 in hbc rewards for every store credit card they sign up and 10 000 hbc rewards ( I'm guessing it works out to a 1 dollar now since the points revamp ) for converting people from the store card to the hbc mastercard.skeet50 wrote: ↑ They are a retail business - not a credit granting business. Having sales associates focused on selling credit applications and not the stock that is in front of them is losing sight of its core business. The credit card is simply an add-on.
As for emails, the whole point of collecting emails is to build a database for marketing purposes. Once you have the person in the store, your goal should be on sales, not on finding ways to market to them. Your customer is in front of you so stop advertising to them and start selling.
I agree with you that other retailers are going in this direction. It's also one of the main reasons that so many retailers are facing difficulty right now.
Source: worked for them in 07 for a short stint
- playnicee1
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- Feb 9, 2012
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Don't you think it would have happened by now?EastGTARedFlagger wrote: ↑ And again, who's to say Loblaws can't come up with their own line of "PC Humane" skin care products (and maybe pay the SPCA to put their seal of approval on the packages) to undercut Body Shop and Lush? That's what I was saying.
If it ain't broke, don't fix it!
- EastGTARedFlagger
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- Feb 22, 2016
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Give them time, Loblaws has successfully cloned enough other stuff under the PC label already, why would this be any different? I'm no Loblaws fan but it is surprising they haven't done this yet.playnicee1 wrote: ↑ Don't you think it would have happened by now?
- playnicee1
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It would have been in all their Joe stores by now, if not in all their RCSS stores...long before now.EastGTARedFlagger wrote: ↑ Give them time, Loblaws has successfully cloned enough other stuff under the PC label already, why would this be any different? I'm no Loblaws fan but it is surprising they haven't done this yet.
It's not their focus.
FYI Bay had a Nector soap store inside their stores for a little while to tackle Body shop and it failed miserably.
(They heavily pushed their red bar of soap at the time, but who knows why they failed-they just did.)
FWIW, Bodyshop is having trouble currently. Maybe the new owner will be able to keep the stores going...maybe not.
If it ain't broke, don't fix it!
- cardle
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I wasn't imagining things and years ago Joe Fresh did try: https://imabeautygeek.com/2009/11/10/ba ... e-showers/playnicee1 wrote: ↑ It would have been in all their Joe stores by now, if not in all their RCSS stores...long before now.
It's not their focus.
FYI Bay had a Nector soap store inside their stores for a little while to tackle Body shop and it failed miserably.
(They heavily pushed their red bar of soap at the time, but who knows why they failed-they just did.)
FWIW, Bodyshop is having trouble currently. Maybe the new owner will be able to keep the stores going...maybe not.
I remember trying one of those, but they have been gone for a while now so I guess they didn't work too well.
Edit, here is the full range:
Body Wash - a fresh foaming body cleanser (250 ml, $4);
Body Balm - a creamy, exotic scented lotion (250 ml, $4);
Body Polish - a foaming and cleansing, gentle gel-based exfoliating scrub
that helps remove dead skins cells, leaving skin feeling soft and smooth
(250 ml, $4);
Body Mist - a light, refreshing mist that leaves skin feeling soft and
fragrant (150 ml, $4);
Liquid Hand Soap - a hand soap that works into a rich, fragrant
lather ($4);
Scrubbie - available in an array of colours for all over body use ($2).
- EastGTARedFlagger
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Thank you for this, and from what you posted it is blatantly obvious why they failed. They got too greedy -- they barely undercut Body Shop et al with those prices. Those aren't predatory prices. You're not gonna draw Body Shop customers in by giving them a measly $1 discount on each item. That isn't an RFD customer base you're dealing with. Those people are very brand-conscious* and you need to be a hell of a lot more aggressive if you want to win them over on price alone.cardle wrote: ↑ I wasn't imagining things and years ago Joe Fresh did try: https://imabeautygeek.com/2009/11/10/ba ... e-showers/
I remember trying one of those, but they have been gone for a while now so I guess they didn't work too well.
*prices snipped*
Similarly, Loblaws could try to open a bunch of coffee houses that look like Starbucks but if they try to charge just $1 less than the Seattle green monster does, they're DOA. That's what happened here.
If you want to hurt a market leader (by trying to siphon off their overly loyal customers) you need a better product at a much lower price. McDonald's McCafe taking aim at both Starbucks (cheaper espresso drinks) and Tim's (cheaper and better tasting regular coffees, better promos, loyalty card program) is a good example of this.
*let's also not forget holiday gift giving, or other occasions. Sorry, any store brand would make the gift giver look like a cheapskate. That's something Loblaws can't overcome -- other than for babies/young children who don't know any better, you wouldn't give Joe Fresh clothing as a gift, so why would you give Joe Fresh skin care products? To that end I'm sure Body Shop et al make most of their money at Christmas/Valentine's/Mother's Day.
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