The recent announcement that the Boohoo fashion group is being re-launched as the Debenhams Group is riddled with more irony than a Shakespearean play.
But firstly, the purchasing of the key assets of one of the UK’s most loved department stores was undoubtedly a stroke of genius by Boohoo. Even at its demise it was an attractive proposition to the customer, pulling enormous customer numbers through its doors and onto its website, it had a powerful beauty brand portfolio, and an excellent mix of private label and third party fashion brands.
Its demise was largely the result of the worst type of private investment, where every asset was ruthlessly stripped from the business, which was then ladened with so much debt in order to pay its shareholders, that it finally became unable to pay off even its interest.
Boohoo saw a bargain and an opportunity and it has turned Debenhams back into a viable online brand with potentially an omni-channel future.
Ironically at the time of Debenham’s administration Boohoo was storming ahead as the stella performer in the ultra-fast fashion world with a stable of socially driven online brands offering dynamic product drops for the lowest of prices.
But in a major twist of fate, whilst Debenhams was being restored to glory, and customers were rediscovering Debenhams, Boohoo fell fowl of multiple accusations of breaking workers rights in the UK, and soon every accusation against the ultra fast fashion industry became firmly stuck onto the brand’s glossy image.
Add to that, the intense competition from Shein & Temu, and Boohoo began a dramatic slide in both sales and value. Ironically it is the ailing Debenhams that has come to the rescue.
Will the rebranding of the group to Debenhams Group mark the end of Boohoo as a major player, relegated to a bit-role within the Debenhams house of brands? All of its misdemeanors, its dubious practices well hidden within the depths of the new company. Time will tell if those same rumours and accusations will emerge and taint the name of Debenhams itself.
Certainly, in terms of financial survival and reputation the renaissance of Debenhams has come just in time.
It is also an interesting comparison to look at the acquisition of House of Fraser by Sports Direct several years before. Once again a bastion of the UK high street, a famous department store that slipped into administration was snapped up by a business which although never accused of any wrong-doings, carried with it a bruising and uncompromising reputation that was certainly a deterrent for some customers. .
There are obvious differences. Sports Direct was, and continues to be, very successful in its own right. The deal saw House of Fraser remain vey much a physical chain of shops, where the traditional department store brands now sit side-by-side with the brands of Sports Direct, USC and Flannels.
But once again it is the group branding which is so interesting. The successful trading brand being substituted by the brand name of the failed department store. The Frasers Group.
It would seem that in both cases the respect and trust inspired by these much-loved department store brands, even in their lowest moments, was valued more by customers than the wheeling-dealing newcomers to the block, with their shady reputations.
Ironic indeed, as only a few years before, at the birth of ecommerce, it was the new shiny pureplay businesses that were predicted to become the cherished brands in customers hearts as names such as Debenhams, House of Fraser, Marks & Spencer and John Lewis crumbled into obscurity. Obsolete to today’s customers. The road has been rocky, but clearly these traditional brands retain more affection, authority and resilience than anyone might have thought possible.
So what next? Despite it’s recent renaissance and return to profit, perhaps the most trusted store brand ever on the UK high street might be the perfect foil for one of the world’s most disreputable and despised fashion businesses.
Could the future owners of John Lewis ever be Shein? Branded for fortune and favour as the John Lewis Group. A tarnished brand never knowingly undertold.
Do the many twists and turns of the mergers & acquisitions road still hold yet one of the biggest ironies of all.