The news world had a feeling this was going to happen yesterday but our design intern Carys has had the feeling for quite a bit longer: Republic, the Leeds-based fashion retailer went into administration yesterday (13th February 2013), putting around 2,500 jobs at risk.
The company bowed out of the retail race with this parting tweet: “We did all we could but it’s simply too tough out there.”
And it definitely is tough out there. Republic is yet another name in an already uncomfortably long list of retailers who have also gone into administration this year.
So what caused the collapse of Republic?
Having had a unique insight into Republic’s headquarters for a second year University group project in 2011 as part of a marketing and innovation module, our Carys may have an answer or two. Here’s what she did and what she found out…
“After attending a day’s workshop getting to know the Republic company and their ‘important people’ at its head office in Leeds, with our university’s permission we set about undertaking a mass of research and our own large scale, public customer surveys focusing on the Republic brand.
“Surprisingly our search revealed little about the company’s history, only that it was founded in 1986, it started out as a men’s-only denim retailer in Leeds (who knew?). Our survey also revealed some other interesting results. After asking an 89 strong group of Republic’s target audience (18-25 female’s) it revealed that:
- 8% had never heard of Republic
- 48% said they had never shopped there
- 52% of people didn’t know Republic also sold its own branded clothing
- Only 28% of people had noticed Republic’s (at the time) new-look website.
The most common response when we asked people: “who do you think shops at Republic?” was “young girls buying cheaply priced party wear”. Not the kind of response Republic was aiming for and it became clear to us that our marketing strategy which we were to provide Republic with as part of the university project, needed to address these people’s perceptions of the brand and ultimately market Republic in such a way to change these off target perceptions.”
This misalignment between Republic’s perception of their target audience and their audience’s perception of Republic that existed when Carys undertook this project in 2011 could arguably be one of the very early indicators that this brand was destined to struggle. Any marketer knows a well-developed brand- helps build a company’s, reputation and customer base, and seemingly the Republic brand was not building the right reputation and customer base.
“When the day came, we went to Republic’s head office armed with all 120 questions and their respective answers we’d gathered from our public survey, along with the information we gathered about the company’s history.
Personally, my first question to put to the head team was: “If your head office is in Leeds and you claim to be a Leeds based company, proud of your roots….why isn’t there one Republic store in Leeds City Centre?” The answer I received: “We haven’t found the right retail space yet, we need a prime spot on the high street and those are very expensive”. A fair point I had to admit. Sure enough though, sometime later on 13th September 2012 a Republic store did pop up on the busy Briggate high street in Leeds City Centre.”
Here lies a second insight into where Republic might have gone wrong with their company expansion. To open a flagship store in your ‘home town’ so to speak, over 20 years after the brand initially launched seems counter-intuitive at best. Moreover, Republic’s demise has been attributed to the excessive rates, bills, staffing and other fees associated to owning and running over 120 retail stores. Had these stores been fewer and better placed in key cities (like Leeds) could the brand have simultaneously reduced outgoings and improved sales, thus surviving the current market place? Alas, we’ll never know.
What Carys’ time at Republic in 2011 demonstrates is that no business goes in to administration as quickly as it sometimes appears and indeed in the case discussed here, it would seem Republic was having problems as early as approximately 2 years before. Clearly there are subtle warning signs brands should be looking out for if they are to survive the current pace of both online and offline retail, such as brand awareness and brand perception.
Our advice is to keep an even closer eye on your business objectives, how you are aiming to achieve them and most importantly, if in fact you are achieving them
The motto: Plan, Test and Review.