What Fashion Brands can Learn from Sears' Downfall

Hey guys! I know I don't normally post opinion articles on my blog but, this story has been on my mind lately. Let me know what you think in the comments!

Sears Holding Corp. has been on a downward spiral that caught the attention of the finance world in 2015, when reports suggesting that the company was no longer viable came out and really hurt the retailer’s already shaky image. However, many Wall Street analysts have written that the company’s true downfall started long before. According to an article from Business Insider published on January 8^th the retail giant has been suffering under the direction of CEO Edward Lampert. Lampert became CEO in 2013 although he had been involved with Sears for many years prior. According to the article, Lampert has been trying to turn the retailer into a data collection service that resembles tech companies like Amazon and Uber. The Sears Shop Your Way program, launched in 2009, spearheads this strategy. Lampert has been criticized for selling off the company’s assets, such as the well-liked Lands End clothing brand as well as real estate, to prop up the business. Unfortunately, the company’s financial statements from last quarter showed further losses and little hope that a turnaround is on the rise.  

What happened to the 123 year old American heavyweight? I’ll leave the numbers to Wall Street and the SEC but, I can say that Sears is a prime example of how retailers have been failing at branding. This narrative is not unique to Sears and many fashion brands have joined the race to vie for the notoriously flighty attention span of young millennial and gen Z consumers. However, some companies are all too eager to give up their brand in order to “evolve” and appeal to the younger generation. This often results in one of two unhelpful outcomes. Either, a very inauthentic marketing campaign directed at young people that is usually received by the audience as arrogant or out of touch or, an attempt to remake the brand’s image that just ends up confusing core customers and new comers alike.

 Lampert has been quoted as comparing his vison for Sears to companies like Apple and Microsoft which are well known for their cult following of loyal millennial customers. He is not the only one who has noticed this phenomenon though and many brands believe that the success of companies like Apple lies with their “cool” and “hipster” image as well as their aggressive branding strategy. For example, their strategies include putting the simple Apple logo on everything and diligently ensuring every piece of the company, from retail stores to commercials, projects the easily recognizable sleek aesthetic of the Apple brand. While these tactics are definitely factors in these companies’ success what many have failed to recognize is that the companies true appeal for young people lies with their inspiring story of success and the perseverance their young founders exhibited through many rejections. Gen Zers in particular are a generation of entrepreneurs and respect the entrepreneurial spirit of some of the more recent and well known founders and their companies. Ask almost anyone under 35 how Apple was started and you will most likely get an answer that includes “by Steve Jobs in a garage”

How many people under 35 know who founded Sears? J.C. Penny? Macy's? Nordstrom?

Millennials, especially young millennials and gen Zers who grew up during the recession, are often portrayed as being a generation of cynics who don’t believe in the American dream. Whether it was intentional or not many companies have responded by burying their brand’s roots in a jumble of other “ironic” advertising and PR campaigns that are supposedly more trendy. Others, especially newer brands, have gone the opposite direction overbranding their company with “storytelling” to the point of inauthenticity.

Some companies’ appeal is simply due to their “cool” factor and in that case the founding of the brand isn’t really that important to their audience. But, for a company like Sears, with a rich history of innovation and company culture, leaving that behind and trying to be the next “it brand” can lead to disastrous consequences. The line between remaining relevant and exciting and, retaining the core brand story is thin and blurry however it shouldn’t go unnoticed. While it would be easy to blame Sears entire demise on Lampert, I believe their troubles started long before he was involved. Revenues were falling as early as 2001 and the company was already facing a rapidly shrinking customer base by the time Lampert came onto the scene. The company, like so many others, relied on word of mouth among their older customers for their brand's reputation and failed to carve out a clear cut purpose in the minds of new customers making them increasingly irrelevant. Leaving customers to wonder things like: "What does Sears do?" won't lead to the success of any new initiatives the company may have on the rise. Making sure that a company’s purpose and direction is clear to consumers before attempting any experimental marketing or business strategies is very important for new and existing brands alike.