Closure: Coming to a store near you

Posted in Retail
By Laura Leslie on January 21, 2015

Woolworths store closing last day everything must go It’s no secret that there is something serious going on in the Canadian retail industry and the winds of change don’t particularly seem positive. It didn’t feel like too long ago that Sears regretfully informed Canadians of major cutbacks and the iconic Eaton Centre store prepared for shutdown. Now in the last few months Canadians have had to brace themselves for not one, but three retail deaths including Mexx, Sony Canada and the oh-so hopeful Target Canada.

Thousands of jobs are being lost while an unmanageable amount of real estate opens up. With Target’s multi-billion dollar mistake, international retailers may find expansion into Canada to be daunting and ominous. Generally a weaker Canadian dollar means less consumer spending in the US which could have had Canadian retailers in high spirits but instead a formidable cloud hangs over the Canadian retail industry as a whole.

Why couldn’t they make it?:

So what went wrong? Sony and Mexx have notoriously high quality products, while Target promised epic savings. Each company appeared to have their own reasons for success, yet each floundered somewhere. Here is the publicly stated breakdown for each company’s tragic demise:

Sony Canada:



Blame Canada:

Michael lablanc, Senior VP at the Retail Council of Canada, thinks Canada is a very competitive market to be in, he explained that cross-border shopping and e-commerce could be considered detrimental factors. The more international stores making their products easily accessible via their websites, the less obliged Canadians are to keep their money local. However, with the weakened Canadian dollar we may see cross-border shopping slowing down.

From a marketing standpoint Canada also experiences various challenges. Canadians are said to behave uniquely with different demands and expectations from retailers.  Marketing from one province to the next also varies greatly requiring robust marketing strategy and opportunities for failure.

The real reason they couldn’t make it:

The new Sears CEO, Ronald Boire, said it best: “When you focus on the consumer you win”. Although Sears had its struggles to remain in the Canadian market, understanding it was time to cater to the consumer kept them around.

We live in world where people can shop from their homes. Brick and mortar stores can take this as a hinderance, or they can strategize to capitalize on every opportunity across all available channels.

That means recognizing that the millennials are no longer walking into Sony’s brick and mortar stores to buy CD players. Fancy displays donning higher-than-average price tags are only catering to a small demographic that refuses to take advantage of the Internet. Last year consumer electronics sales were reported as flat overall, although in previous years they have been quite volatile. The steady increase in online sales is what mitigates the rapid decline in in-store sales. However, much like Best Buy and RadioShack, Sony is still feeling the blow in-store, and having trouble picking up the slack online.

Target Canada’s website is not made for online shopping; it’s limited and lacked search functionality. Essentially it is acting as an online flyer while Canadians demand in-store inventory checks and online purchasing capabilities. merely lists nearby store locations. Loyal customers said goodbye to their e-store at last Feburary when Mexx decided to regress their offerings and limit their understanding of their customers.

Burberry is a great example of a retailer eager to succeed and willing to risk all in the name of innovation. Despite being over 150 years old, their techniques are anything but antiquated with features like audio-visual displays and RFID chips in store. All sales associates are given iPads to use while helping a customer. That way they are able to login to the customer’s profile and view their activity from every outlet, reminding them of past purchases and helping them with size and availability.

Retailers who want to succeed inside and outside of Canada have to accept that the Internet has changed retail. Omnichannel offerings allow retailers to collect valuable data from multiple channels. The opportunity that lies within that data is limitless. Knowing what a customer has done from their mobile, to their computer and then lastly, in-store is the key to optimizing marketing efforts and increasing revenue.  Omnichannel isn’t going anywhere, choosing to remain loyal to traditional ways of selling means choosing to fail.