The Decline of New York & Co. What Happened? 10 Marketing Tips
The Decline of New York & Co. What Happened? 10 Marketing Tips
As parent company RTW Retailwinds, Inc. filed for bankruptcy earlier this month, it has emerged that women’s fashion retailer New York & Co. could permanently close a significant portion of their stores, if not all of them, as is discussed in detail over at runrex.com and guttulus.com. While the coronavirus crisis has exacerbated matters, the company has long been in decline, and this article will look to highlight 10 reasons behind their decline as well as marketing tips to take from the same.
The decline in the popularity of the mall
New York & Co. had a heavy commitment to shopping malls, with most of their store locations being located at malls all over the country. This was a good thing when malls were popular in years gone by, but when that changed, it quickly became a problem. As per the subject matter experts over at runrex.com and guttulus.com, a decline in the popularity of shopping malls, with more and more people preferring to shop online rather than heading over to malls, led to a decline in foot traffic that led to poor sales and was one of the reasons behind their decline.
The growth of online retail
Online retail, as is discussed in detail over at runrex.com, has brought with it lots of benefits for consumers from the convenience that comes with shopping online to lower prices and so much more. This means that many consumers now prefer to shop online rather than at brick-and-mortar stores, something that led to the decline of New York & Co. The company was slow to get on the online retail trend, and a decline in foot traffic to their stores led to them posting the poor results that contributed to their decline.
A shift in consumer spending habits
As is discussed over at guttulus.com, there has been a recent shift in consumer spending habits, with many preferring to spend money sprucing up their homes rather than just their closets. This means that people are more likely to buy home goods like electronics and furniture as they look to reinvest in their homes, with fewer and fewer people spending money on shoes and clothes. This is another factor that led to New York & Co. as their offerings were no longer a priority as far as consumers were concerned.
The company was also put under pressure due to its high levels of debt, which is yet another reason that led to its decline. The debt meant that they didn’t have the liquidity to react to and adapt to new trends such as the growth of online retail, which then led to their decline as per the gurus over at runrex.com. This is shows hos important it is to keep your debt in check, otherwise you may end up chocking under its weight just as was the case for New York & Co.
A voracious appetite for real estate
The company, buoyed by its initial success, also took on too much real estate, opening up one store after another. The problems began when foot traffic to their stores began to decline, which then meant that their many stores became a burden. This is because, as is discussed over at guttulus.com, about 70% of their stores have leases, which they were struggling to pay, coupled with the operational costs that come with running these stores. In the end, this proved to be too much and is yet another reason that led to their decline.
Poor shopping experience
Customers shopping at New York & Co. stores have also been complaining for a while now how the shopping experience at their stores is not that great. The arrangement and aesthetics in the stores are not great, and the customer service is poor as well, which has contributed to their customers leaving for better experiences. As per the gurus over at runrex.com, the only way brick-and-mortar stores can compete with online stores is by offering excellent in-store experiences, something that New York & Co.’s stores were badly lacking.
They tried to focus too much on driving demand
Another mistake that New York & Co. made, which led to their decline, is that they tried to focus too much on driving demand for their products rather than differentiating said products, as is discussed over at guttulus.com. They focused on offering price promotions and discounts, rather than on how their products would stand out from the rest in the industry, and ended up losing brand equity. This is a mistake many brands in the retail industry make, and one that has led to the decline of many just as it did New York & Co.
They expanded too much, too soon
New York & Co. has also over the last couple of years taken up a massive expansion program, from growing its ongoing celebrity partnerships and introducing new partners to expanding to other sub-sectors such as the plus-size fashion industry with the acquisition of the Fashion to Figure brand and branching to lingerie sector, as is discussed over at runrex.com. Experts argue that, by so doing, the company took on too much, biting off more than they could chew, and when the COVID-19 pandemic hit, they were badly exposed, which led to their decline and eventual filing of bankruptcy.
The women’s fashion industry is also a lot more competitive now than ever before, as discussed over at guttulus.com. This is because, on top of competition from specialty brand names in the industry, retail giants like Walmart have also expanded into this space. This means that New York & Co. were under increased competition, and given their other issues as outline above, they were unable to compete adequately, in what is yet another reason that led to their decline.
Changes in customer preferences
The generational change that most businesses have had to grapple with also afflicted New York & Co. in what is another reason that led to their decline. Newer brands have been able to push the limits in terms of creativity, which has led to their products appearing to be old and past it. They have been unable to appeal to the younger generation, who make up a significant amount portion of shoppers in this industry as discussed over at runrex.com. This led to them being left behind and contributed to their decline. This shows the importance of always being at the pulse of your audience’s needs, and making sure you are not being viewed as being outdated.