So what is Canadian Tire going to do with everything it bought from Hudson’s Bay?
Are people going to rush to stores for GlucksteinHome?
On Tuesday, a judge approved a plan for Canadian Tire Corp. (CTC) to buy up most of the copyrights, trademarks, and IP owned by Hudson’s Bay for $30 million.
Among the 350 pages of filings laying out exactly what Canadian Tire is buying are Hudson’s Bay names, marketing mottos, and logos, including the signature “stripes” pattern. It also includes several of its house brands, like apparel brand Hudson North, home furnishing brands Distinctly Home and GlucksteinHome, and appliance brand Beaumark.
Notably absent, however, is Zeller’s, which is arguably the most well-known and culturally relevant of the brands HBC owned.
Why it makes sense: Canadian Tire Corp. has spent nearly 12 years beefing up its selection of owned and exclusive brands, whether they were built from scratch or acquired. The big focus has been outside of its core automotive and hardware business, like Canvas home decor, Noma lighting, Paderno cookware, Vermont Castings grills, Sherwood hockey equipment, Denver Hayes clothing, Frank home goods, and MasterChef kitchen tools.
Okay, but: Where is CTC actually going to sell this stuff? Other than the striped merch, HBC’s private brands aren’t the kind of draw that are going to bring people to stores. But aside from that, while it’s easy to imagine HBC-striped products in any of its stores, others seem to be out of place. In some cases, that is because they would directly compete with CTC’s existing brands, but in others, they aren’t really a “brand fit.” Hudson North attempts to be more fashion-forward than the dadcore styles at Mark’s. GlucksteinHome furniture is more design-focused than the practical, limited selection of Canvas furniture in Canadian Tire stores.
One possibility, though, would be to take some of the HBC brands and position them as higher-end alternatives to some of its existing brands.
There is the possibility of opening new, smaller retail stores that are both more cost-effective than the massive HBC retail footprints and designed to make some of the HBC brands feel more at home. But no retailer is particularly eager to expand its physical retail holdings in the current economy — unless CTC plans on converting some of its existing Canadian Tire, Mark’s, or Sport Chek locations.
But maybe: The HBC stripes are all it needs to cover the $30 million bill, which is a bargain compared to some of Canadian Tire’s other recent acquisitions. Canadian sold the Helly Hensen outerwear brand for $1.3 billion earlier this year, after buying it for $985 million in 2018. It bought Party City’s Canadian assets for $174.4 million in 2019. It only paid $19.3 million for Paterno parent company Padinox in 2017, but that was for a single brand.
Oh, there’s also this: Included in the acquisition is all of the customer data collected as part of Hudson’s Bay’s loyalty programs. Like many retailers, CTC has identified bolstering its own loyalty program as a key priority for the years ahead, and ingesting more data will help it drive repeat purchases, sell/target ads, and boost its own AI capabilities.