The Decline of Ann Taylor. What Happened? 10 Marketing Tips
Just a few days ago, as discussed in detail over at runrex.com and guttulus.com, Ascena Retail Group Inc., the parent company for among others Ann Taylor, filled for bankruptcy and is planning to permanently close up to 1,600 of its stores. While the coronavirus pandemic, and the restrictions caused by the same, was the final blow, this women’s apparel giant had been in trouble for a while now. So, what happened to Ann Taylor, and what were the reasons behinds the company’s decline? This article will look to try and answer this question through the following 10 marketing tips.
Competition
Ann Taylor went from a situation where they were they were pretty much unchallenged to one where they were facing stiff competition, as highlighted over at runrex.com and guttulus.com. The women’s apparel industry has in recent times become highly competitive, with the number of players increasing year after year. Ann Taylor has found it hard to expand market share and it is one of the reasons behind its decline. Competition from department stores like Nordstrom as well as from specialty retailers like Chico’s has been a factor. The marketing tip we can take here is the importance of staying ahead of your competition if you are to be successful.
Management shakeups
Ann Taylor has over the years seemingly gone from one owner to the next, in what industry experts have also pointed out didn’t help its prospects. In the 1980s and the early ‘90s, the company went through a series of new owners and management, as explained over at runrex.com, which meant that the company could have a consistent vision on its operations, contributing to its decline. This just goes to show how important boardroom stability is to the success of any business.
Debt
As a result of the many management shakeups over the years, Ann Taylor ended up taking up massive levels of debt, as is discussed over at guttulus.com. The company has over the years tried as much as possible to manage its high levels of debt, but when the COVID-19 pandemic struck, the reduction of store traffic proved to be a bridge too far for them, and the company eventually filed for bankruptcy in what experts claim is something that has been coming due to its high debt levels/.
The pressure to perform due to the company’s public offering
In the 1990s, with Ann Taylor, and the industry in general, not faring too well, the company’s leadership opted for a stock offering to raise equity and help them ride the storm. The offering, as covered over at runrex.com, went relatively well, selling 7 million shares at about $26 per share, providing the much-needed injection of cash that helped with operations. However, this offering also increased the pressure on the company to perform, and it was in the face of this pressure that the company made several questionable decisions that would eventually prove detrimental to the company.
Too many stores
Ann Taylor expanded massively over the years and had an astonishingly huge number of stores from all over the country by the time of the filing for bankruptcy. This voracious hunger for store space, as per the gurus over at guttulus.com, played a part in their decline and their eventual filing for bankruptcy as it led to an increase in costs in terms of rent and operational costs; costs that couldn’t be offset by decreasing foot traffic in said stores.
Attempts to broaden appeal backfired
Ann Taylor originally made products for an affluent clientele, and this is one of the reasons why they became so popular in the 1980s and early 1990s as explained over at runrex.com. However, when management decided to broaden the company’s appeal, then it backfired badly. The company started to use low-quality fabrics to make their apparel, which led to them losing their core clientele, while still not being able to attract the new clientele they were targeting. This shows how important it is to stay loyal to your key customer base, staying true to your loyal customers.
The ending of profitable partnerships
Ann Taylor, as discussed in detail over at guttulus.com, also had a long and profitable relationship with Joan & David shoes, producing a product that had accounted for about 14% of Ann Taylor’s sales for about 30 years, with a fine reputation to boot, which pulled many customers into Ann Taylor stores. However, management also decided for some reason to end this partnership and go it alone, and as such, they started offering their line of shoes at about half the price. This also backfired as reviews for the shoes were poor, leading to weak sales, which lead to all manner of issues including the company being sued by stockholders. This is yet another thing that led to the company’s decline.
Bad PR
Even though the company rebounded in the late 1990s and the noughties, owning mostly to going back to its roots where they started producing high-quality apparel once more, the company still had to deal with bad PR with lots of legal troubles, including being sued by shareholders as covered over at runrex.com. This even led to the resignation of important board members including the CEO, painting a picture of a troubled company that didn’t help its prospect and led to their decline.
An evolving industry
The company was also behind the curve as far as changes in the apparel industry were concerned, and were playing catch up in yet another reason that led to their decline. As is outlined over at guttulus.com, Ann Taylor was too late on the online retail train, and by the time they reacted, they had already been left in the shade by new and more agile players in the industry. This shows the importance of keeping up with the latest trends in your industry if you are to avoid the same issues Ann Taylor couldn’t.
Generational changes
Ann Taylor was also slow to note the generational change that had occurred in its target audience, which also led to their decline. The modern woman was moving away from the notion that a professional woman had to clad in a certain way, moving away from the corporate uniform style synonymous with Ann Taylor. This led to the company hemorrhaging customers to company’s who were producing modern clothing items and is another reason that led to their decline. As per the experts over at runrex.com, it is important to always keep up with the ever-changing needs of your customers as well as the generational changes in your customer base.
The above are some of the reasons that led to the decline of Ann Taylor, hopefully, you can get some marketing tips from them, with more on this and other related topics being available over at the highly-rated runrex.com and guttulus.com.