The Art of Brand Resurrection: Turning Retail Graveyards into Gold Mines
In the unpredictable world of retail, where trends come and go, some brands find themselves facing an untimely demise. Yet, in the shadows of bankruptcy, a peculiar resurrection dance unfolds, orchestrated by masterminds who specialize in breathing new life into fading giants. Welcome to the lucrative world of undead brands, where the likes of Forever 21, Juicy Couture, and Pier 1 refuse to rest in peace.
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Photo by Artem Beliaikin on Unsplash |
A Symphony of Revival: Authentic Brands Group success
In the graveyard of retail, the corpses of once-beloved brands are not left to decay. Instead, they become the canvas for a unique form of artistic resurrection. Consider the case of Forever 21—a fashion giant that, just four years ago, filed for bankruptcy. Fast forward to 2020, and it found itself in the arms of an unusual savior: a coalition comprising America's largest mall operators and a mysterious entity known as Authentic Brands Group.
Under this new ownership, Forever 21 didn't just survive; it thrived. Last week, in a bold move that could redefine retail landscapes, it announced a partnership with fast-fashion behemoth Shein. This is not a mere coincidence but a strategic play orchestrated by those who specialize in the art of reviving dying brands.
The Necromancy Of Reviving Dead Brands and Retail Taxidermy in Business
The process of brand resurrection operates on a simple premise: when a company collapses, it's often sold in pieces, and among the fragments is its intellectual property—the brand, the designs, the customer data. Enter the necromancers of retail, those who buy this intellectual property to perform a kind of retail taxidermy.
James Cook, the director of retail research at JLL, succinctly captures the essence of this dark art: "Not everybody knows the store is closed." In the age of perpetual digital existence, people continue to Google these brands, creating a demand that savvy entrepreneurs seek to satisfy.
Online home-goods retailer Overstock.com is currently attempting this with the intellectual property of brands like bankrupt Bed Bath & Beyond. It sheds its old identity, embraces the acquired brand, and voila—a new lease on life. This isn't a mere game of smoke and mirrors; it's a calculated strategy to capitalize on the residual allure of a familiar name.
Authentic Brands Group Portfolio: Masters of the Undead
In the realm of undead brands, one entity reigns supreme—the enigmatic Authentic Brands Group. With a portfolio boasting over 50 labels, some of which may surprise you with their brushes with bankruptcy—Nine West, Quiksilver, Juicy Couture, Nautica, Barneys, Brooks Brothers—the group has mastered the art of brand necromancy.
What sets them apart is their refusal to dabble in the mundanity of traditional retail. "We don't manage stores, inventory, or supply chains," declares the company to prospective investors. Instead, they focus on the essence of a brand—the intellectual property. They buy it at a bargain, and then, like puppeteers, sell licensing rights, earning royalties.
Consider the reincarnation of Brooks Brothers, once declared bankrupt in the throes of the COVID-19 pandemic. The shirt you buy carries the label, but it's Authentic Brands Group that owns the soul, the cool factor that makes the brand resonate.
Authentic Brands Group valuation: All the Cool, None of the Boring
Authentic Brands Group, under the visionary leadership of CEO Jamie Salter, has embraced a niche, risky, and undeniably profitable business model. They don't manufacture; they curate the cool. Alex Terseleer, a principal at Kearney, notes, "Authentic is the sole owner of basically everything that makes a brand cool."
Their value and portfolio extends beyond fashion labels; they control global branding for iconic figures like Elvis Presley, Marilyn Monroe, David Beckham, and Shaquille O'Neal. Even Sports Illustrated rests in the hands of this brand sorcerer.
Brand Revival Risks and Rewards: Authentic Brands Group revenue
Stripping away the retail overhead and focusing solely on the resurrection of brands has proven to be a lucrative yet risky venture. Authentic Brands Group, a little over a decade old, revealed 2020 revenues close to $490 million, with nearly half of it being profits. It's a testament to the innovative approach of looking at retail, a daring ballet on the edge of risk and reward.
However, they are not alone in this dance. Retail Ecommerce Ventures, another player in this mystical realm, acquired the intellectual property of brands like RadioShack, Pier 1, and Dressbarn. The dance floor is crowded, with each player attempting their pirouettes in the delicate art of brand resurrection.
The Quest for Immortality: Retail-Brand Taxidermy
As Authentic Brands Group contemplates becoming a publicly traded entity, the industry watches with bated breath. Distinguishing between good retailers and good brands becomes the litmus test for success in this peculiar business of retail-brand taxidermy. Jamie Salter, the founder, and CEO emphasizes the need for a brand to transcend its original confines, to sit in other retail stores, expand into other categories, and most crucially, go global.
It's a constant leap of faith, a daring tightrope walk between the realms of the living and the undead. Not every brand possesses the immortality required for this peculiar form of resurrection. It's a game of strategy, a chessboard where each move holds the fate of a brand.
The Epitaph: Lessons From Undead Brand Success
In the ever-evolving world of retail, the brand is dead—long live the brand. The resurrection of once-dead names, the orchestration of retail taxidermy, is a testament to the artistry that exists in the shadows. As long as there are nostalgic consumers and a hunger for the familiar, the undead brands will continue to dance, guided by the puppet masters of Authentic Brands Group and their ilk.
In this intricate ballet between the living and the undead, one thing remains clear—retail's graveyard is not a final resting place; it's a stage for a grand performance of resurrection.
FAQs
How does a brand survive bankruptcy?
Surviving bankruptcy involves strategic acquisitions, often by companies like Authentic Brands Group, which focus on reviving and licensing intellectual property.
What happens to the intellectual property of brands (bankrupt companies)?
Intellectual property, including branding, designs, and customer data, is typically sold when a company goes bankrupt. Buyers may attempt to revive the brand through retail-brand taxidermy.
Who are the key players in reviving dead brands?
Companies like Authentic Brands Group specialize in reviving dead brands. They acquire intellectual property, strip retail overhead, and license the brand to generate revenue.
Why do some brands become undead while others disappear?
Successful brand revivals hinge on factors like brand recognition, global expansion potential, brand expansion strategies and the ability to sit in different retail categories. It's a leap of faith for companies like Authentic Brands Group.
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