Hudson Bay revives Canadian discount retail chain

Canadian department store Zellers hopes to make a comeback next year, 10 years after the discount chain closed most of its stores.

Zellers plans to launch a new e-commerce website and expand its brick-and-mortar footprint inside select Hudson’s Bay department stores nationwide in early 2023, according to HBC.

The revamped discount retailer offers a “digital-first shopping journey that leverages brand nostalgia,” the company said.

Zellers Chief Business Officer Adam Powell said: “Zellers is a brand deeply rooted in the Canadian experience.”

Zellers’ resurgence comes at a time when soaring inflation is driving consumers to cut retailers in search of lower prices and face stiff competition from incumbents such as Walmart, Dollarama and Giant Tiger.

Reviving the brand could help Zellers gain market share when people are looking for ways to save money, said executive director of McMaster University’s Master of Public Policy in a Digital Society. said Vass Bednar,

“We are in this period of inflation and people are more price conscious than ever,” she said. “Shoppers who remember the Zellers brand will associate it with saving money.”

Zellers’ resurrection plans are also amid an ongoing lawsuit over the use of the Zellers brand by a Quebec family.

The Moniz family is behind various recent trademark filings and company registrations, including Zellers Inc., Zellers Convenience Store Inc., and Zellers Restaurant Inc.

In a statement of complaint filed last fall, HBC accused the Moniz family of trademark infringement, goodwill depreciation and so-called passing off (false marketing or product misrepresentation).

Retail analyst Bruce Winder said Zeller’s reintroduction is likely due in part to the lawsuit.

“This is most likely related to legal issues with trademarks,” he said. “For Zellers to really say, ‘This is ours,’ he has to show that he uses it.”

Zellers will face a tough competition in the discount retail market, he said.

“It might be a niche opportunity and I hope it works, but I don’t think it will be a hit all at once.”

Zeller’s Department Store was established in 1931 and was acquired by HBC in 1978.

The company operated as a discount division of its flagship Hudson’s Bay Department Store with the slogan, “When the lowest price is the law.”

The store peaked in the late 1990s with about 350 locations before being overtaken by larger competitors such as Walmart.

In 2011, HBC announced plans to sell most of its remaining Zellers leases to Target Corp., closing most of its stores by 2013.

The retailer has kept several Zellers locations open as clearing outlets through 2020.

The company recently launched a pop-up Zeller’s shop inside the Hudson’s Bay department store in Burlington, Ontario. and Anjou, Cue.

Brett Vandale

canadian press