Jason Solarek picture
Jason Solarek @ Bridge Aug. 22, 2018 • 12:51 PM • 2,045 days ago
Jason Solarek picture
Jason Solarek @ Bridge Aug. 22, 2018 • 12:51 PM • 2,045 days ago

What Does the Gump's Bankruptcy Mean for Your Business?

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As you likely know, Gump’s filed for bankruptcy. The famous San Francisco indie store's crash is having wide-ranging consequences for our industry. 41 Madison tenants likely lost more than $1,000,000 on Gump's.

Yet, the economy and stock market are doing very well. How to explain these contrarian events? Furthermore, you surely are asking: How did Gump's reach this low--and more importantly what does this mean for your business?

Started 157 years ago, Gump's had a 150 year lead to succeed in retail. In theory, it could have created any of today's successful retail companies: Amazon, Wayfair, even Apple--but, it didn't. Why?


Part of Gump's failure is that it failed to invest in and embrace new technology. Ever since the invention of the wheel, technology has been one of the best investments mankind can make. But Gump's seems to have bypassed this truism. As a symbol of its reluctance to adapt, a large part of Gump's revenue relied on a printed catalog that it mailed to customers. ...When is the last time you received a printed catalog from Amazon?

3 signs that your business may be headed towards Gump's fate:
1. If your business is not investing in your website daily.
2. If your business is conversely wasting money online (VR, over-reliance on social media).
4=4If you're reading this on an old mobile phone or computer. The technology you use says a lot about where your business is going. If you want the digital customer, you have to use what the digital customer uses.

And, even if you do the above steps, you are still tied to your colleagues. Reason: a rising tide lifts all boats, and likewise a lowering one hurts us all. Gump's mistakes cost its vendors' money.

In order to prevent the next Gump's and you losing, I believe we have to ask: how did Gump's get to the spot that it did?

I remember Gump's staff coming to the trade shows. They seemed to walk on water and were treated like royalty by brands.

You see, we can't just blame Gump's for its demise. We have to ask: What about the brands and trade show organizations that didn't help push Gump's (and other indie stores) into the 'Amazon Century'? All those cocktail parties and hor d’oeuvres but no time to innovate?

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NY NOW and other legacy shows need to innovate like NYC's Shoppe Object trade show

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The truth is: Gump's is part of a wider industry problem. Have you been to the trade shows in Atlanta, NYC, and Dallas? The show floors are essentially devoid of digital engagement and computers. If the future of retail is technology--which it is, then why are the brands, trade shows, and sales reps so far behind. Why don't the showrooms on the 8th and 9th floors of AmericasMart have rows of iMac computers to look at products online? The showrooms need to look more like an Apple store and less like Gump's. Currently at shows, there is no easy way to view websites, videos, or digital catalogs. Laptops and iPads are too small for two people to comfortably view products and catalogs on. And a booth can only fit so many products. Adding a large, flat digital screen opens a massive window to all of a brand's SKUs at minimal cost. Customers can come to the show and touch product as well as see the 100s of additional choices on the screen. Embrace merging the analog and digital world.

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Showrooms need to look more like an Apple store and less like Gump's.

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I feel that many in this industry have not pushed hard enough to give retailers the tools they need to succeed. For example, brands for years have spent lots of money on trade shows and advertising in dated print publications but have failed to invest in their websites, professional photos, or online strategies that help their retailers. I knew a brand that lacked website pictures for many of its products but still advertised in Tableware Today. It only recently realized what a money-losing approach that was. It nows spends that ad money instead on getting professional digital pictures that it can post online and distribute to retailers. I'd recommend a brand upgrade its 'digital house' and spend less on booth space, analog materials, and print ads. Why? Long after the trade show lights have dimmed and customers have thrown magazines out, your digital investments will continue to pay dividends with your retailers. Consider that Amazon didn't staff any booths at trade shows and now is all that people talk about at trade shows. Facebook doesn't advertise but is a household name in: advertising. Ask yourself: how do you grow your business like these companies?

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Scott Galloway's book The Four can help you avoid Gump's fate

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What's next in our industry? Amazon and technology are coming faster than we know. We don't have 157 years or 57 years or even 7 years. Amazon shook San Francisco. Amazon surely plans to help bring the same earthquake that it did to Gump's to your doorstep. If you want a preview, read Scott Galloway's book The Four. (Side note: I hope one of the marts invites Galloway to speak.)

What are you going to do about technology's dominant rise? I can tell you what Bridge is doing...
+ Starting 10 years ago, Bridge started digging our 'digital trenches' and creating a great e-commerce platform.
+ Today at Bridge, we're taking 800+ brands, retailers, and reps kicking and screaming into the Amazon Century.
+ On a daily basis, we're helping our members compete online and grow.
+ Sales are up 42% year over year for our members. That's a 42% boost for our retailers, brands, and sales reps.
+ Retailers that use Bridge report selling 13% more. Read the survey here.
42%
+ Orders placed via Bridge are up 42% year over year.
+ Retailers, brands, and sales reps are succeeding with Bridge software.

Together I believe we're stronger and can fight back. We invite you and your business partners to join us. Have suggestions or questions? Those are welcome, too. I'm at: 212-254-9654.


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To read the HFN article about Gump's bankruptcy here:
http://www.hfndigital.com/news/gumps-files-bankruptcy/