Stressed shoppers looking for a comforting reminder of days gone by will welcome the return of Zellers when the discount store reopens its doors in Ottawa next week, one retail analyst argues.
Barry Nabatian, director of market research at Shore-Tanner & Associates, said issues like inflation, the war in Ukraine, and a host of economic, political and environmental worries are “pushing people to familiar, well-known stores of which they have good memories.”
“People’s values and tastes and desires have changed a lot in the past 15 years or so. During this time period, high-end as well as discount stores have done quite well, and now people are slowly going back to mid-quality/discount and familiar products,” he said. “Zellers fits these desires perfectly.”
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Earlier this week, the Hudson’s Bay Company announced that Zellers stores within the Hudson’s Bay locations at St. Laurent Shopping Centre and across Rideau Street from the Rideau Centre will open Thursday, March 23. The Zellers.ca e-commerce platform will launch the same day. There is also a Zellers planned for Les Promenades Gatineau on Maloney Boulevard in Gatineau. The date for that has yet to be announced.
Nabatian says people are shopping more locally since the pandemic and are looking for increased connection with others – they want “more interaction with other people, with known people, products and services,” he said.
Adding to the nostalgia will be the Zellers Diner on Wheels, a revamp of the Zellers Family Restaurant. The food truck will visit various store locations over the opening days as part of a “throwback event” before making a tour across Canada, according to a press release from HBC. “Canadians are craving a taste of nostalgia and Zellers is dishing it out,” the company wrote.
While in-store diners won’t be possible with the new setup inside Hudson’s Bay stores, the truck is polling customers via Instagram to narrow down the familiar menu favourites, with options like the “Big Z Burger” to satisfy sentimental shoppers.
Ian Lee, an associate professor at Carleton University’s Sprott School of Business, told OBJ in January that “nostalgia marketing” has its merits but he’s not convinced such an approach will have mass appeal, especially to younger shoppers who aren’t old enough to remember when the brand was a dominant force.
He said the discount retail space is “significantly more competitive” today than it was 10 years ago, with players such as Dollarama and Giant Tiger. Also in the discount space, Amazon and Walmart have developed sophisticated infrastructure that uses big-data analytics to track consumer spending and target merchandise at specific customer groups – tactics that Zellers will be hard-pressed to duplicate, Lee explained.
“I think (Zellers) is going to have a tough, tough time,” he said. “The Bay does not have the resources of Amazon or of Walmart, which are both gigantic companies.”
In a news release issued earlier this week, HBC said Zellers will serve customers across “key lifestyle categories,” including kitchen and bath, accent furniture and home decor, organization and storage, baby and kids toys and apparel, pets, and apparel basics for men and women.
“We know Canadian shoppers are smart and savvy and will be looking for both value and an elevated aesthetic in the products they shop us for. Instead of limited time sales or discounts, Zellers shoppers will know they are getting the best price, every day, no matter when they shop,” said HBC in a news release, adding that the Zellers experience will feature “a hint of the nostalgia that Canadians know and love.”
The Zellers stores within the Hudson’s Bay locations will be between 8,000 and 10,000 square feet, depending on the location.
Zellers was founded in 1931 and acquired by HBC in 1978. It operated as the discount division of its flagship Hudson’s Bay department stores, with the slogan “Where the lowest price is the law.” The store hit its peak of about 350 locations in the late 1990s before losing ground to big box competitors such as Walmart. In 2011, HBC announced plans to sell the majority of its remaining Zellers leases to Target Corp., closing most stores by 2013.
The retailer kept a handful of Zellers locations open as liquidation outlets, including a store at 2065 Robertson Rd. in Nepean, until 2020.