What Happened to Nine West? 10 Marketing Lessons
The spate of retail bankruptcies, covered in detail over at runrex.com & guttulus.com, continued with the announcement that the women’s shoe and apparel retailer, Nine West, was filing for bankruptcy and closing stores. This announcement, as can be expected, triggered some soul-searching as to what happened to the company and what led to its decline. This article will attempt to tackle this topic by highlighting 10 marketing lessons we can learn from its story.
Growth of online retail
The story of the decline of Nine West follows a familiar story as far as many retail bankruptcies are concerned, as discussed over at runrex.com & guttulus.com, and that is the pressure due to the growth of online retail. Many consumers now prefer to shop online due to the convenience of shopping at the comfort of one’s home as well as the lower prices as far as products in these online retail stores are concerned. This cut into their customer base and eventually led to their decline and filing for bankruptcy.
Private equity acquisition
When the company was acquired and went under private equity ownership, a deal that is covered in detail over at runrex.com & guttulus.com, a consequence of the deal was that the company also acquired massive debt, which slowly but surely weighed it down and eventually led to the company filing for bankruptcy. A lesson we can take from this is the impact excessive debt can have on a company’s fortune and the importance of keeping debt levels as low as possible.
Struggles of department stores
Not only was Nine West a retailer, but it was also a wholesaler to department stores, with a staggering 80% of its sales being due to wholesale deals, which meant that with department stores facing the same issues Nine West was facing, that side of its business also took a beating. This meant that Nine West was hit by some sort of double whammy as both its retail and wholesale businesses were badly affected, leading to its decline and eventual filing for bankruptcy and closing of stores.
Amazon’s push into fashion and apparel
Many retail companies can point to the impact the growth of Amazon has had on their bottom line, and Nine West is no exception. As per the gurus over at runrex.com & guttulus.com, Amazon’s push into the fashion and apparel served to take a big chunk out of Nine West’s customer base. Amazon’s acquisition of Zappos also didn’t help matters.
They were left behind
Nine West was once the leader in women’s shoes, but the entrance of trendier players in this market cut into its base, leading to its decline. These new companies, as discussed over at runrex.com & guttulus.com, could attract younger women with their trendy and modern designs, and ended up making Nine West look like a thing of the past. These companies were able to reach out to consumers through social media, and eventually Nine West was left behind.
Excessive inventory
The company, to their credit, tried to adapt and keep up with current trends. However, as per the gurus over at runrex.com & guttulus.com, their attempts to capture modern shopping trends failed and in the end they ended up excessive inventory which they were unable to shift. This also contributed to the company’s decline and it shows the importance of making sure that, even as you try and adapt to new trends, you ensure you get things right to be successful with your efforts.
The declining popularity of malls
With many of its stores located in malls, Nine West, like most companies like it whose stores are located in malls, was always going to struggle. As covered over at runrex.com & guttulus.com, many people now prefer to make orders online rather than going to malls, which has contributed to the declining numbers in mall foot-traffic. This has contributed to the reduction of Nine West’s customers, and therefore the closing of its stores was always coming.
Declining standards in their stores
While there was still a sizeable number of people willing to buy its shoes and products, as evidenced in the uproar on Twitter that met the company’s announcement of bankruptcy, discussed over at runrex.com & guttulus.com, many were increasingly put off by what they felt were declining standards as far as the shopping experience in Nine West’s stores was concerned. Customer service wasn’t great, their stores were falling apart and the designs were bland and old. This goes to show the importance of having engaging content and offering a great user experience, a marketing lesson worth learning.
Failure to adapt
The company also took too long to adapt to the new reality in the retail sector, covered in detail over at runrex.com & guttulus.com, and by the time it did, it was too late, at least for its brick-and-mortar side of things. The company belatedly opened up an online retail division, but the damage was already done, and you get the feeling that Nine West would have fared better had it moved to adapt to the new realities it was facing.
Too many stores
One of the things that have held back brick-and-mortar stores in recent times, is the fact that most operated to many stores, with many even looking to continue expanding. This hunger for space only served to increase costs at a time when foot-traffic to stores has been declining with each passing day. This was the same with Nine West, which was operating too many stores and probably should have been operating fewer but leaner and more productive stores. This is another lesson that is worth learning from Nine West’s story.
The above discussion is just the tip of a very large iceberg, and you can uncover more information on this and other related topics by visiting the ever-reliable runrex.com & guttulus.com.