It’s been a tough few years in the retail ranks, with lots of once-high-flying chains trimming their store counts and multiple nameplates disappearing altogether from Main Street and malls.

But many of those brands still have equity, and a range of strategies is being employed to leverage them into licensed product, ecommerce sites or other ventures.

While the licensing of retail brands isn’t new – Sharper Image, for example, has been applied for products almost since its retail stores closed in 2008 – the number of retail names being liquidated seems to be increasing exponentially, as their owners (or creditors) look upon those names as leverageable assets.

The FAO Schwarz name has been through this dance a couple of times. It was purchased by Toys R Us (TRU), which itself exited retail in the U.S. and UK this year and closed the iconic flagship Fifth Avenue location in Manhattan 2009. ThreeSixty Group bought the brand from TRU in 2016, and recently opened a new 20,000 sq. ft. store in Rockefeller Center, with plans to franchise around the world; it has a franchise agreement with Chinese toy distributor Kidsland, which is readying a 27,000 sq. ft. location for Beijing in early 2019. It also granted a license to Hudson Group to open airport stores in the U.S.

ThreeSixty also is weighing a franchise program for Sharper Image (which it purchased in 2016), though it’s currently focused more on licensing the brand for merchandise. ThreeSixty affiliate MerchSource currently makes and distributes the bulk of Sharper Image branded product, but licensees Conair (curling irons, hair dryers) Mystic Apparel (apparel, bedding, toys) and Aerus (air purifiers) are all slated to deliver them in 2019.

Brookstone and the UK-based fashion label/retailer Bench were snapped up by BlueStar Alliance and Gordon Brothers, respectively, in October. And American Legacy Brands purchased the A&P and Waldbaum’s IP in May, potentially to revive them for food products. A&P, which owned Waldbaum’s, liquidated in 2015. But American Legacy plans to launch a new A&P web site by year-end in an effort to gauge interest in the brand, says CEO Steven Shamula.

“In many cases the brand is coming with a built-in base of consumers who can be accessed” through email lists, social media and other means, says Gordon Bothers’ Ramez Toubassy, whose firm purchased and is seeking to revive the Wet Seal and Bench brands. “The assumption is that you can continue to communicate with them and let them know the brands are coming back, and that helps in relaunching something that is compelling to them.”

“Sometimes,” notes Concept One’s CEO Sam Hafif, whose company licensed Authentic Brands Group’s Aeropostale brand for luggage and bags​, “consumers don’t even realize there has been a change, so there is still strong brand equity and a base to build from.”​

Approaches to reestablishing what may be a tarnished or faded retail brand are both similar and different:

Wet Seal

Gordon Brothers bought the Wet Seal brand in 2017, after the 171-store U.S. apparel chain liquidated. “With Wet Seal, there wasn’t a wholesale business, so we needed to establish the web site first” to regain customers, says Toubassy.

The brand first jumped back into retail via crowdsourcing. Mexican fashion company and licensee Osom established a Wet Seal web site last fall, selling apparel and footwear it sourced and using third-party licensees for sunglasses and fragrance.

The target for the crowdsourcing was the same – 13- to 24-year-old consumers – as before the chain filed for bankruptcy, but the approach was different. Osom and Gordon Brothers took the best customers – a customer list, as is usually the case, was part of the acquisition– and had them preview upcoming designs for the line. Based on their feedback and purchases, the companies decided which pieces to put on a broader web site. In the beginning, a minimum of 100 styles were introduced for feedback and celebrities and influencers were enlisted to add cachet. The process reengaged consumers with the brand and reestablished ties that may have frayed during bankruptcy.

“The online presence has been great, but we are still scratching the surface. We are still figuring out how Wet Seal best serves the needs of the customers and who the best customers are,” says Toubassy. “Once we have established our brand and proven our business model, we can go to wholesale with certain categories and later on consider stores.”

FAO Schwarz

With FAO Schwarz, which ThreeSixty acquired from Toys R Us in 2016, in-store locations were established at Hudson’s Bay, Macy’s, Bloomingdale’s and others largely as a Q4 promotions in 2017 and lay the base for the brand’s return. ThreeSixty next launched an internally developed FAO.com ecommerce site and this fall, in addition to opening the New York store, gained distribution at Kohl’s for the first time.

While MerchSource makes the bulk of the FAO Schwarz toys, licensee Wild and Wolf launched a 33-piece wooden magnetic train set on Amazon. And franchisee Kidsland, in addition to opening a flagship store in Beijing, is planning one for Shanghai and will add upwards of 50, 5,000-sq.-ft. locations throughout China. Licensee Hudson Group opened its first location in November at LaGuardia Airport in New York.

“There is wholesale, franchising and licensing. The store and FAO.com sit in the middle of all three [of those models] and serve as a blueprint for how we want the brand the show up at retail, whether it’s a flagship or a 1,000-sq.-ft. location,” says Three Sixty’s David Conn.

To insure continuity, each of the franchised locations is to include elements of the iconic FAO Schwarz flagship, such as the huge piano keyboard or clock tower, says Conn. At the same time, the brand also is being positioned to meet a new generation of customer. Model Gigi Hadid redesigned the trademark uniforms for the toy soldiers at the New York store, opting for Moschino suits in red, white and black. And product packaging was redesigned to meet current trends.

“You have to be able to identify packaging graphics that feel true to what FAO is all about, but at the same time it has to be more contemporary and new,” says Conn.

Brookstone

Brookstone is being quickly being revived by BlueStar Alliance, just months after it filed for bankruptcy in August. And while there are no plans to reopen the 101 mall-based locations that closed, BlueStar plans to expand presence in airports and China, where there are 550 stores.

BlueStar also is raising the brand’s profile with consumers through marketing and social media and recently signed licensing agreements with Kalorik (small kitchen electrics, floor care), Southern Telecom (electronics) and Lifeworks (mobile and PC accessories)

Bebe

BlueStar took a similar approach with retailer Bebe, which closed its stores in 2017. It struck a licensing agreement with apparel supplier Global Brands Group (GBG) not along after buying the brand. (Coincidentally, there’s a Bebe store across the street from GBG’s headquarters in New York.)

While keeping Bebe top-of-mind with consumers is being done through integrated marketing, social media and ecommerce, it has been equally important to keep a foot in brick and mortar retail, says BlueStar COO Ralph Gindi.

“Having retail stores always elevates the brand experience first-hand, but shop-in-shops and pop-ups are also a good tool to keep in touch with the consumer,” says Gindi. “Time is of the essence” with retail brands and “it is really important to have a presence at retail at all times. The window of opportunity to keep a brand relevant must always be a very high priority.”

Contacts:

Authentic Brands Group, Nick Woodhouse, Chief Marketing Officer, 212-760-2410 x2411, nwoodhouse@abg-nyc.com

BlueStar Alliance, Ralph Gindi, COO, (212) 290-1370, rgindi@bluestarall.com

Concept One, Sam Hafif, CEO, 212-868-2590, sam@concept1.com

Gordon Bros Brands Division, Ramez Toubassy, Pres., 310-243-6766, rtoubassy@gordonbrothers.com

ThreeSixty Brands, David Conn, CEO, (917) 660-1198, david@threesixtybrands.com