Thursday, July 16, 2009
Weed’em and Reap!
Smith & Hawken, the upscale garden retailer, is closing all of its 56 stores. With retail sales remaining weak, especially in higher-end goods, Smith & Hawken is another casualty of the recession, a fiercely competitive marketplace for home goods, and where consumer expectations that have been growing like, well, weeds.
Scotts, the company that sells brand name lawn and garden products including Ortho, Miracle Gro and Roundup bought Smith & Hawken in 2004 for $68.5 million. According to their now-defunct web site, Smith & Hawken has already stopped taking online orders. Its company spokespeople report that the retail chain "has not been profitable since we purchased it," apparently the antithesis of the biblical business maxim, “as ye sow, so shall ye reap.”
This most recent failure in luxury retail is a combination of a brand pushing the limit to higher-end goods at a time when the economy has consumers looking for quality and value. It turns out these days consumers believe a trowel is a trowel no matter how ergonomically designed, and is, apparently, not worth $25 or more. And it turns out that there is an actual ceiling for teak garden benches.
Customers who used to be loyal to Smith & Hawken cultivated relationships with other home and garden improvement providers who better met their expectations, and are growing share and reaping profits. According to the Brand Keys Customer Loyalty Engagement Index they rank as follows:
1. True Value
4. Home Depot
There’s an old adage that goes “old gardeners never die . . . they just go to seed.” The same, alas, cannot be said for brands.
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