Bed Bath & Beyond is probably going bankrupt soon.
Founded in 1971, the company became a staple for affordable home decor, kitchenware and college dorm room furniture. It’s known for ubiquitous blue coupons ranging from $5 off one item to 20% off everything you bought. The cavernous stores have merchandise stacked to the ceilings.
The company already announced the closing of 140-plus stores. Those whose job it is to follow such things predicted this ending long ago. Still, many consumers are stunned to learn BB&B is in trouble.
We suspected it months ago, because of the coupons. Bed Bath & Beyond was always discounting and accepted expired coupons. The purchase-by dates meant nothing.
And last fall we noticed fewer promotional mailings arriving. The postcards and catalogs were on less expensive paper.
Car dealers know customers expect promotions as the norm. Customers missing one holiday sale will wait for the next one before making their purchase. Full retail prices mean nothing in such a situation, as BB&B has learned.
Financial analysts refer to it as a drug addiction.
As Bed Bath & Beyond now tries to figure out its next move, consumers have changed the way they shop. In an effort to save time and gasoline, buying commodity items like sheets and towels makes much more sense at Target or Walmart while shopping for groceries, cosmetics and greeting cards.
Or they can just shop at Amazon, have it delivered, and be done with it. Visit the store? I don’t think so!
So, just as Fry’s Electronics, Modell’s Sporting Goods and Payless Shoes closed or moved online, BB&B is apparently on the same path.
Relying strictly on its never changing promotional strategy without shifting rapidly enough to internet sales mortally wounded this company. And any organization concerned about its future must regularly examine its marketing strategies to best understand what customers are doing … and why.
Bed Bath & Beyond could still pull it out, of course. Testing different kinds of promotions might keep customers’ interest. Organizing high-profile events at stores should drive traffic, as would cause-related efforts and some strategic alliances.
Remember Albert Einstein’s words: “Insanity is doing the same thing over and over and expecting different results.”
Let’s face it: We’ve all gotten so many of those coupons, we don’t even see them anymore.
With that said, I wish you a week of profitable marketing.
Get ahead of the curve at www.askmrmarketing.com.
