Big Retail Brand Stages Remarkable Comeback After Bankruptcy
According to The Street, In today’s retail landscape, going out of business and being liquidated no longer signifies the end of a brand. With name recognition playing a crucial role, many companies are being revived under new ownership, leading to a phenomenon known as “zombie brands.” These revived entities often capitalize on the nostalgia associated with their predecessors, but the experience they offer may fall short of the original.
The Evolution of Recognizable Brands
A prime example of this trend is Sharper Image, which once featured vibrant, hip stores that captivated customers. After closing its retail locations, the brand was revived to sell a range of lower-end gadgets, games, and office novelties, leveraging its name recognition without recapturing the original shopping experience.
Similarly, Toys R Us has undergone multiple transformations since declaring bankruptcy and liquidating. While the brand name still resonates with consumers, it now exists primarily within the toy sections of larger retailers like Macy’s. This reimagined presence is a far cry from the iconic standalone stores that many fans fondly remember.
Bed Bath & Beyond is another noteworthy case. Just after its closure, its intellectual property was swiftly acquired by Overstock.com, which purchased the Bed Bath & Beyond name, albeit without plans to restore its former retail footprint. Recently, Overstock has been repositioning itself under the name “Beyond” and is even considering reviving another once-thriving brand.
A Comeback for Zulily
Zulily, an online clothing retailer targeting moms and children, has taken a unique route. Although it never officially declared bankruptcy, the company laid off most of its staff and initiated a liquidation process without court involvement. On December 22, 2023, Zulily entered into an Assignment for the Benefit of Creditors (ABC), allowing a third-party fiduciary to oversee its asset liquidation and orderly wind-down.
This abrupt decision angered many customers, particularly those with unpaid orders, as the company announced it could not issue refunds and required customers to file claims for outstanding amounts. However, shipped orders would be honored as planned, offering some solace to customers.
Beyond’s Plans for Zulily’s Revival
Despite its struggles, Beyond has acquired the Zulily name and is poised to relaunch the brand soon. The company has seen its own operating losses swell from $4 million to $47 million compared to the previous year, yet it remains committed to reinvigorating Zulily.
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During a recent earnings call, Beyond’s Executive Chairman Marcus Lemonis shared insights into the relaunch strategy. “We completed the architecture and POV on Zulily, and signed over 100 legacy vendors with another 100 suppliers in the onboarding pipeline. The site is now in the internal testing phase, and we are targeting to launch Zulily on September 10.”
CEO David Nielsen emphasized the importance of retaining experienced staff from the original Zulily to understand its customer base better. “We hired a team of experienced merchants who were with legacy Zulily, know the Zulily customers, and have established working relationships with important brand partners. Their efforts are bearing fruit as we’ve made significant progress on onboarding key legacy vendors while also adding some new ones.”
The relaunch plans include exciting flash sales and a consistent assortment of essential items on the site, accessible through a member login, thereby enhancing the profitability of the new venture.
Conclusion
The resurrection of brands like Zulily and the continued evolution of others exemplify a new era in the retail industry. While these “zombie brands” may not recapture the magic of their original iterations, they offer a fresh approach to leveraging established names and catering to evolving consumer preferences. As the retail landscape shifts, the ability to adapt and innovate may ultimately determine the success of these once-great brands.
