Retail “concept” stores, all the rage a year ago, are being shut down, as chains focus on their main brands instead of dozens of niches, according to a story in the Wall Street Journal.
As recently as a year ago, retail “concept” stores were hot, offering the feel and prices of boutiques and taking aim at tiny slices of the youth market. Today, however, many of these teen stores are shutting down, as retailers make a harsh reassessment of slicing the market into dozens of niches, according to a story in the Wall Street Journal.
The story, written by Nicholas Casy, says Pacific Sunwear of California has closed two concept store brands in the past 18 months. Abercrombie & Fitch Co. and American Eagle Outfitters Inc. also both heavily invested in concept stores aimed at slices of the young adult market, but none performed well and are now siphoning resources from their parents.
At big chains, concept stores offered a way to experiment with new products and merchandizing trends, often doubling as the parents’ research and development labs.
Consumer spending cutbacks, however, have forced retailers to wind down these experiments to preserve cash. Earlier this month, the story says, Tiffany & Co. disclosed plans to close its 16 Iridesse stores, which sell pearl jewelry and were launched in 2004. In January, Home Depot Inc. nixed a specialty chain called Expo Design Center that would sell high-end home furnishings.
Teen retailers once built entire strategies around concept stores, opened skater-themed, surf shops and dark-themed boutiques modeled after nightclubs.
Now, those niches are taking their toll, as chains report losses.
WSJ Online subscribers may read the full story here.