More than 4,000 retail stores are set to close this year—and we’re only four months into the year. While the dominance of online shopping sites like Amazon is partially to blame, there are still a few lessons business owners can learn from these giant retailers’ mistakes. Here are the biggest brands that will be shuttering their doors this year and some key takeaways. Need help boosting your business? Our Apex digital marketing company can help you rank higher in search engines.
Gap, Inc. Closing 230 Stores
Once known for being the height of cool, sporty fashion, Gap couldn’t survive a market that changed drastically in its 50-year history. The brand announced that it will be shutting 230 stores this year, splitting into its still-steady Old Navy brand and another, still-unnamed company.
The Lesson: Keep the “Cool Factor”
Gap once had a strong “young and trendy” brand image, which it maintained through high-end ad campaigns fronted by the likes of Madonna and Missy Elliot. Over the years, though, Gap lost its awareness on what the young and fashionable want, as the demographic gravitated towards cheaper brands like brands Zara, H&M and Forever 21. The lesson? Pay attention to your target audience, and try to keep up.
Victoria’s Secret Closing 53 Stores
L Brands’ Victoria’s Secret is planning to shut 53 stores this year, as the lingerie retailer struggles to appeal to women. The once-popular brand closed 30 stores in 2018, and has been closing roughly 15 stores each year. Meantime, up-and-coming lingerie brands like Adore Me and Lively have taken the market share that Victoria leaves behind.
The Lesson: Adjust to a Changing Climate
The Victoria’s Secret Angels may have been stunning icons of femininity when the concept was new, but after the novelty wore off, the brand was plagued with controversies about body image, diversity, sexism, and objectification. The Victoria’s Secret business model didn’t adapt to fit the #MeToo era, and its declining sales reflect that. The lesson? No matter what your personal opinions may be, it’s good business to keep an ear open to the political climate that surrounds your shoppers.
Pier 1 Closing 45 Stores
Pier 1 closed out 2018 with an unimpressive holiday shopping season that saw sales drop 13.7% from the previous year. The company has been identified as one of a dozen retailers that could be on its way to bankruptcy in 2019, a projection encouraged by the fact that in March, the retailer hired attorneys and consultants to help it with debt restructuring.
The Lesson: Assess Your In-Store Experience
As companies like Amazon, Walmart, TJ Maxx, and Wayfair continue to expand into the home goods category, it’s getting harder for Pier 1 to compete. Industry insiders like the company’s former CEO, who stepped down in March, have noted Pier 1 shoppers describe it as being cluttered and overwhelming. Today’s customers are accustomed to finding what they need immediately, and Pier 1’s store layout doesn’t accommodate that experience.
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