I was not surprised to learn that Eddie Bauer had filed for bankruptcy in this article. Eddie Bauer is a great example of a company that abandoned its roots, drifted into a different operating model, and never really connected with a core set of customers (which is in many ways similar to what GM has done to itself) in the new operating model.
The retail clothing chain got its start in Seattle where I grew up, and I have vivid memories of going into their great big downtown store in the early 1970s with my Dad, seeing camping equipment, shotguns, fishing rods, and lots of down jackets. For many years their quilted down jackets (which Eddie Bauer himself patented) were their signature item and it seemed as though every grownup had one.
I remember going to their store when I was in high school in the 1980s and overhearing that they were getting rid of their gun department. Then as the 1990s approached, they eliminated their fly fishing department. Fishing and hunting departments were replaced with sweaters and golf clothing. Since then, I have gone into the odd Eddie Bauer in a mall from time to time hoping to find a last minute Christmas gift, and every time I go in, I see that it has become a not-so-special store and I wonder why people shop there (I haven’t had any success with the last minute Christmas gifts). Clearly no one has filed any product patents on behalf of the store for a long time.
I am not saying it’s a mistake for a company to shift, or expand focus. Eddie Bauer actually started his shop as a tennis shop, and Nordstrom started out as a shoe store (though in the case of Nordstrom, shoes remain a big part of their brand). My issue with Bauer’s is that as they got away from sports, fishing, and camping, they failed to establish a deep connection with customers in their other products, which is why they have been adrift and flirting with bankruptcy for so many years.
The first of the three business value pillars that I talk about in the Rethink book, is being clear about which specific blocks of work in your organization are most valuable to your customers, your partners, and your employees – those are the ones that make up the brand and identity of the organization. I am not suggesting that bringing back their gun department will solve their problems – times have changed, I do think there’s plenty of room for innovation in outdoor clothing, and I would probably start there, and use that differentiation to connect with customers who value whatever it is they come up with.
It’s a perfectly rainy day in Seattle today, I am going take my son fishing – the perch are really biting in the lake at this time of year.
-Ric
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