THE BELATED TRANSFORMATION AND EVENTUAL DOWNFALL
As sales steadily dropped year after year, Bed Bath & Beyond finally decided to undergo a major overhaul. In 2019, the company’s two founders stepped down and Mark Tritton, the former chief merchandising officer of Target, was appointed CEO.
Tritton unveiled an ambitious three-year growth roadmap, outlining strategic initiatives aimed at rejuvenating the brand.
The plan included decisive actions such as the closure of underperforming locations, introduction of private-label brands, and remodeling of approximately 450 stores.The company also allocated $250 million to modernize their technology platforms and another $250 million to transform their supply chain infrastructure.
While Tritton’s massive innovation program was already difficult enough to pull off, implementing it just as the COVID-19 pandemic hit proved to be extremely challenging.
As the pandemic triggered disruptions in the global supply chain, the company’s own legacy supply chain infrastructure made it more difficult to stock already scarce products. Their store replenishment time was 35 days, and inefficiencies throughout the supply chain were driving high costs. Their ecommerce technology and processes were also not as advanced as their rivals, making them far less competitive at a time when purchases were mostly done online.
Pushing private-label brands, which worked at Target when Tritton was there, also proved to be unsuccessful as customers remained loyal to the known brands they were accustomed to buying.
In the end, Bed Bath & Beyond tried to do too much at a time when revenues were in decline and they were also facing external challenges. Profits continued to slide and the company could no longer keep up with debt payments, which led them to file for bankruptcy.
HOW CAN OTHER COMPANIES AVOID SUFFERING THE SAME FATE?
Bed Bath & Beyond's failure to meet customer expectations and adapt to the digital age serves as a cautionary tale for businesses today.
At our company FROM, The Digital Transformation Agency, we have witnessed the transformative power of investing in digital capabilities, conducting thorough customer research, and prioritizing initiatives effectively. By implementing these strategies, companies can stay ahead of the curve, deliver exceptional experiences, and achieve their desired business outcomes.