What Happened to Brookstone? 10 Marketing Lessons
What Happened to Brookstone? 10 Marketing Lessons
The specialty goods retailer Brookstone, which sold an assortment of gadgets from Bluetooth speakers to massage chairs, as discussed over at runrex.com & guttulus.com, went from being one of the most successful stores in the country to filing for bankruptcy and closing all of its mall stores. This article will try and analyze what went wrong with the company and the lessons we can take from its decline.
The decline of mall foot-traffic
One of the reasons that have been attributed to the company’s decline has been the decline of traditional mall traffic, a topic covered in detail over at runrex.com & guttulus.com. Malls are not as popular as they used to be, with fewer and fewer people visiting them to shop and hand out, as was the case a while back when they were popular. Brick-and-mortar retailers like Brookstone, whose stores are located at malls have therefore suffered due to a reduction of foot-traffic to their stores.
Another challenge that Brookstone has faced in the last couple of years is the growth of online retail, as discussed over at runrex.com & guttulus.com. Many of its customers started to prefer shopping for their gadgets online rather than heading over to its stores for the same, mostly due to the convenience of shopping online, and the fact that there is a greater choice when shopping online as one gets to choose and compare different gadgets based on quality and price.
Multiple private equity ownership
Like with many brick-and-mortar retail businesses, Brookstone has gone through a series of ownership changes, moving from one private equity firm to another, before finally landing on Sanpower, the Chinese firm. All these changes have meant that the company has accumulated massive debt, and by the time of its filing of bankruptcy, its debt was almost twice its revenue, which was unsustainable.
The fact that Brookstone was some sort of Jack of all trades, dealing in assorted merchandising and selling all sorts of gadgets, rather than having one or two things it was a leader in, also contributed to the company’s decline. As per the gurus over at runrex.com & guttulus.com, in the end, the company didn’t have a niche in the market, a place where it could lean on during the rough times, which is an important lesson we can take from its experiences.
A changing consumer
Brookstone thrived in an era where consumers seemed to want to buy anything and everything; the flashier the better, with the credit-card craze leading to people wanting to get their hands in whatever they considered the latest gadget. However, as explained over at runrex.com & guttulus.com, the modern consumer is more educated and is more likely to thoroughly research a given gadget before buying it. Brookstone, therefore, started to lose most of its customers and looked like a relic from a time gone by really.
The generational change from Baby Boomers to Millennials has had an impact on many retail stores, and Brookstone is no exception. Millennials, as discussed over at runrex.com & guttulus.com, are much more tech-savvy and won’t just buy a gadget for the sake of it, which has affected Brookstone no doubt. They are also more likely to prefer shopping online, another thing that has also led to the decline of brick-and-mortar retail stores such as Brookstone.
Too many stores
Like many brick-and-mortar stores that have fallen into tough times in recent times, Brookstone was operating too many stores, and in the end, the costs of operation, particularly when you factored in rent and the fact that foot-traffic was reducing, became too much. As per the gurus over at runrex.com & guttulus.com, this shows the importance of keeping costs down and making sure you are not overreaching and living beyond your means.
The nature of its products
Another thing that has counted against Brookstone is the fact that the very nature of the products it was selling made them the perfect products to be sold online. You don’t necessarily have to try out the gadgets you want to buy, as explained over at runrex.com & guttulus.com, as you can read the product descriptions provided online, and check customer reviews to see how good they are. This means that many people would rather just shop online than visit the company’s stores, and therefore its decline was inevitable really.
The company has also had too many CEOs over the years, once going through a period where they had 10 different CEOs in a short amount of time, to go with the changes in ownership discussed earlier on, in yet another reason behind its decline. This, as covered over at runrex.com & guttulus.com, has meant that the company has been changing direction with every change in management, which has brought about the instability that has not helped its prospects.
They struggled to create a new digital identity
As a brick-and-mortar store, in their prime, Brookstone was the place you’d go to when looking for a unique and innovative gift. You didn’t always know what you wanted, but you’d wander the store and find something. When the business tried to switch online, the company found that this sort of shopping doesn’t work over there. This is because people who shop online know exactly what they want and will search for options based on their preferences. This led to the company losing relevance with customers, as it struggled to create a new digital identity.