Retailers on the Extinction List

This post has been removed by editors, pending investigation of claims of material error.

Comments

[GR Bell:]

Pacific Sunwear is not owned by The Talbots. Your mistake is fairly well known, I would think....At least by Retail finance people.

Jan 19 10:14 AM

[pinknoise:]

Talbots does now own PacSun. Also, J. Jill is not closing all stores. Talbots is selling J. Jill in order to focus their finances completely on their own brand.

Jan 19 11:50 AM

[pinknoise:]

ugh. does not* own PacSun.

Jan 19 11:51 AM

[gspet:]

When I read a financial blog that deals with companies that I know nothing about I take the information at face value. I assume the blogger knows what he's talking about. Occasionally I read an article on a company that I actually know something about, and if the article is contrary to what I know, I realize the blogger doesn't have a clue about that company. So, why would I believe anything else from that author? This particular author offers an opinion on Blockbuster, and if I were uninformed I would stay away from BBI (and BBIB) or perhaps even short them. Fact is Blockbuster is in good shape, especially at their current price (there's some recent articles from knowledgeable folks supporting my contention). There is very good evidence to support the belief that their stock price will double this year. There is also very good evidence that at some point down the road reality will hit everyone's darling, Netflix, and their share price will plummet. There's no point in my trying to "prove" my point in this comment. Do some research or make a note and watch what happens this year. I'm long BBIB (at least until it gets to $2.00.)

Jan 19 12:09 PM

[Vox Rationalis:]

Maybe it's the SA editor's fault, but titling this "Retailers on the Extinction List" and including Home Depot does little for your credibility. Why don't you provide data to back up your assertion that these store closings are a result of companies "over-expanded during the previous economic cycle"? Many of these companies would not have survived with or without new stores, and some closing retailers haven't been expanding, but have been just trying to stay above water for some time.

BTW, Home Depot's still planning to open 36 stores in the US this year.

Jan 19 01:46 PM

[SPP:]

www.snopes.com/politic...

Jan 19 02:24 PM

[PROXIMO:]

Thanks for your expert opinion. There's a reason it sells for a buck thirty -nine a share. Not that any of their brilliant strategic initiatives, like their aborted run at Circuit City, reflect in any way on the competence of management. There is a reason Netflix is eating their lunch. Good luck with your position. You'll need it. Actually you'll need a miracle.


On Jan 19 12:09 PM gspet wrote:

> When I read a financial blog that deals with companies that I know
> nothing about I take the information at face value. I assume the
> blogger knows what he's talking about. Occasionally I read an article
> on a company that I actually know something about, and if the article
> is contrary to what I know, I realize the blogger doesn't have a
> clue about that company. So, why would I believe anything else from
> that author? This particular author offers an opinion on Blockbuster,
> and if I were uninformed I would stay away from BBI (and BBIB) or
> perhaps even short them. Fact is Blockbuster is in good shape, especially
> at their current price (there's some recent articles from knowledgeable
> folks supporting my contention). There is very good evidence to support
> the belief that their stock price will double this year. There is
> also very good evidence that at some point down the road reality
> will hit everyone's darling, Netflix, and their share price will
> plummet. There's no point in my trying to "prove" my point in this
> comment. Do some research or make a note and watch what happens this
> year. I'm long BBIB (at least until it gets to $2.00.)

Jan 19 02:28 PM

[kris23:]

Welp, I still don't know if Tailbots owns PacSun, but either way the list of closing down or out of business stores is astonishing. I think the point this article makes is that the list is looooooong and will probably get longer if companies don't develop efficient and effective business models.

Jan 19 04:02 PM

[bobomite:]

Yea I'm not sure about this article.

Gap is listed here as doomed but I know: a) closing 85 stores is nothing and b) the company is doing fine compared with it's peers.

Jan 19 07:16 PM

[brombonz:]

It's also bilge that CACH is closing all stores. Here's a link to the company's IR web page, with links to press releases, a presentation to analysts only last week, financial info., etc.

Jan 19 07:30 PM

[jinht:]

No heard that CACH will close all its stores. I am longing CACH and has watching news for it every day.

Jan 20 12:42 AM

[Joseph Sherman:]

Anjan Chhetry and Joseph Sherman
World Mediterranean MBA
Euromed-Marseille, Marseille, France

Identity-based Branding: avoiding the Extension List

What can companies to to reshape their image to thrive when everyone is trying to simply survive? Consider retail banks with respect to Functional v. Symbolic Branding, Physical Structures and People.

The global trend for market liberalization in the banking sector has increased the competition in the banking sector. The convergence of interest rates within Europe has contributed to making banking a commodity service. Consumers have the power to choose across similar banks where the fees charged on accounts and interests paid on loans comparable across borders. In this situation where the products and prices are becoming more similar, it is easer to see how experiential marketing can have a place in generating revenues for banks.

To move into an experiential strategy, the bank must move from being functional to symbolic. Carù and Cova1 divide brands between functional and symbolic. Traditionally functional brand are focused on thinking and low involvement based on learning, memory, habit, perception, and minimization of effort. Banks focusing on process, atomization and internet based transactions without human interaction tend to be functional.

Symbolic Brands2 however have a clear personality or identity. They are rich in cultural meaning, personality, relationship and trust. These brands are high in involvement with the customer and creating a feeling. Rather than focusing on the banking process involved in transactions, symbolic branding in banks emphasizes an emotional connection with the bank.

For example, promotions for customer orientation, large bank service with small, personal service has been strongly promoted in the US. For large multi-national banks this is taking a different shape. After establishing strong processes to facilitate transactions and services across countries, their main area for growth is feelings and the experience.
Physical Structures

To create a distinctive identity and an image of trust and culture, banks use physical architecture and furnishings.

The Citibank in Milan, Italy draws an aura from the a building in rich architecture of the past, both from the magnificent design of the nearby Galleria Vittorio Emanuele and the simpler but still elegant structure of the bank itself. For Italy, a country with many old and ancient structures an elegant building is fairly common – so the decorative building creates a link with a good past. This creates a feeling of security through authenticity.

In other countries the feeling of security comes from modernity. Citibank, NA Bejing Kerry Sub Branch at the Kerry Center Shopping Mall, the Miguel Angel office in Madrid, Spain and Casablanca, Morocco occupy modern buildings emphasizing glass and technology. Rather than focus on historical architecture – China, Spain and Morocco have rich architectural traditions – they focus on the modern to look to a bright future for security.

The furnishings and office equipment in all four countries are nearly the same – light wood tones and blues in a highly organized but soft layout are dominant. Small hints of local taste appear – especially in Morocco with a large red sofa and a photo of King Mohammed VI in a prominent place on the wall.


People

Buildings and furnishings are relatively easy to maintain consistency compared with the human aspect of banking. The feeling of security, trust and comfort created by the atmosphere lasts only until the client reaches the corporate representative, be it an account officer or bank teller. For international commercial banking primary importance must be given to technical, linguistic, and cultural competencies.

Technical skills – the ability to process transactions - are the easiest to train and make uniform as the level of human interaction is low.

Languages, not only English but increasingly a variety of languages based on regional integration and trade – such as the rise in importance of Mandarin being spoken in Europe – are critical for facilitating transactions. In order to develop a relationship for symbolic branding, the banker must not only speak a language that the client speaks, he or she should speak the client’s preferred language in a way that is comfortable to the client. English speaking banker for example should be able to relate not only to clients from the London, New Delhi, Cape Town or Toronto with ease of regional differences, but also with professionals who speak English as a foreign language.

Cultural competences – often termed “the way we do things here” (reference) are the hardest and most critical to develop. Bankers must be able to represent their institution serving clients traveling internationally with the same service and comfort as they would receive at their local branch. They must be personally invested in their clients’ success by not just completing transactions and paperwork but by doing the work with passion. This is difficult to develop at a traditional international bank where the average banker never knows even a minority of the clients they are working for. Many banks including Citibank have the technical and linguistic qualifications. But to carry out these competencies in a say respectful to culture – both corporate and national, in a way that represents the core values of the bank evenly across countries can be vastly improved for most branches around the world.

Jan 20 01:24 AM

[MrsLinarcos:]

I notice Sears (SHLD) isn't on the list...it's because Lambert is doing everything quietly to keep the stock up, then WHAM!!!!!!!!!!!!!!!, it's gone.

Jan 20 08:24 AM

[One of many:]

Nobody in Chicago is surprised that Macy's finds it necessary to close stores. We have attempted repeatedly to tell them we are dissatisfied with their products, management and general apathy toward the condition of their stores (not to mention eliminating our Marshall Field's when customers never wanted to get rid of it in the first place). Macy's management simply turns a deaf ear, and acts like either nothing is wrong or any problems are the fault of the economy. Such state of denial is not exactly a formula for success.

Jan 20 10:25 AM

[TheCaptain:]

This is the most inaccurate article written. Much of the information here is false and I cannot believe SA would do such a poor job of knowing its facts.

Jan 20 12:33 PM

[User 341529:]

The comment that cache is closing all of their stores is mis-spoken. I urge you to check out their balance sheet and see just how many millions they have in cash on hand, as with any business, during any business cycle, they will close stores that are not profitable, and open additional locations. Cache isn't going anywhere. I am shocked that this article was actually allowed to be published and the writer should really check the facts.

Jan 21 11:35 AM

[jiet:]

Any one kwon some usa great software retailer:)

Feb 12 01:40 AM