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Contents the End of Eaton's: Retail Evolution Contents The End of Eaton's: Retail Evolution The changing retail marketplace, the inevitable passage of time, and what many see as the natural decline of an institution unable to change with the times are just some of the issues that this story represents. It is not, however, simply a business story, since for 129 years Eatons represented a quintessentially Canadian institution and part of the national identity. For some, the disappearance of an icon with direct connections to personal and family traditions is to some extent a loss of a collective sense of self. To younger Canadians, it may simply be the way of the world. Whatever ones reaction, the demise of this family business signals social and economic changes that affect how Canadians shop and how marketers redefine the nature of retailing. Introduction Mythology and Merchandising The Changing Retail Environment All In The Family? The Basics of Bankruptcy Discussion, Research, and Essay Questions . Comprehensive News in Review Study Modules Using both the print and non-print material from various issues of News in Review, teachers and students can create comprehensive, thematic modules that are excellent for research purposes, independent assignments, and small group study. We recommend the stories indicated below for the universal issues they represent and for the archival and historic material they contain. The Bay Stops Selling Fur, March 1991 Olympia & York: A Business Giant Stumbles, May 1992 Superstores: Is Bigger Better? November 1994 Eatons: Canadas Store? May 1997 Other Related Videos Available from CBC Learning Does Your Resource Collection Include These CBC Videos? Credit Card Interest Rates Wal-Mart Introduction The End of Eaton's: Retail Evolution The announcement that many economists, customers, and the Canadian public in general anticipated, and that many people considered inevitable, finally came on August 20, 1999. Eatons, the venerated icon of Canadian retailing, was filing for a proposal to creditors under the Bankruptcy and Insolvency Act. Many of its customers were saddened by the news, but few were surprised. After all, Eatons has been on shaky financial ground for most of the last decade. Two years before, the company had filed for protection from its creditors, a kind of stay of execution in the words of Laurence Booth, finance professor at the University of Toronto. At that time, the creditors approved a $419-million restructuring plan, and Eatons hired Brent Ballantyne, an experienced turnaround specialist to take over as chairman from George Eaton. On June 10, 1998, Eatons went public for the first time in its long history, issuing 11.7 million common shares at $15 a share. The Eaton brothers still held 51 per cent of the shares, thereby keeping the controlling interest in the company that bore their name. Under new management, Eatons started to close many of its departments such as electronics, appliances, and in most stores, furniture and rugs. Instead, management focused on a new look and on selling higher-profit fashion merchandise. In order to save costs many Eatons employees were let go. Despite these changes, the company still reported a $72-million loss in 1998, and share prices plummeted. In an attempt to lure younger and more affluent consumers into its stories, Eatons launched a new, hip advertising campaign and started to change its merchandise to meet this demographic groups need. In marketing terms, this was not the conservative, inclusive, family image that Eatons, Canadas store, had projected for almost 130 years, and in a renewed advertising campaign, the company played up this trendy new image in a slightly self-deprecating manner. Unfortunately, despite the suddenly revised image and product lines, the store was unable to compete for younger consumers in a marketplace with an abundance of faddish and stylish specialty stores. Rather than attracting new customers, the store ended up alienating those who comprised its loyal, traditional, and generally older customer base. Eatons new marketing initiatives encountered the age-old generation gap. They forgot about us, lamented 71-year-old customer Grace Simmons. Were the old-timers. Were the ones who built the place. I cant imagine how much money Ive spent in here over the years. We bought everything here: the clothes for our kids, the clothes for the grandkids, the furniture, everything. In early October 1999, Sears Canadathe company that is 55 per cent owned by U.S.-based Sears, Roebuck and Company, and which had already announced the purchase of eight of Eatons stores for $55-millionissued a further announcement that it would also be purchasing five of the Eatons downtown locations. The stores, which are among Eatons best performers in terms of sales, will be refurbished and reopened as Eatons stores and will return to the traditional Eatons full department stores marketing Eatons brand merchandise. Sears will also relaunch the Eatons catalogue. In the end, though, the Canadian retail industry was still faced with a significant shift in the marketplace. At Eatons flagship store at the Toronto Eaton Centre several faithful shoppers stopped to rub the foot of the bronze statue of Timothy Eaton, the man who started the retail dynasty over 130 years ago, a tradition bringing good luck. Unfortunately for Eatons, the luck has run out. Introduction Mythology and Merchandising The Changing Retail Environment All In The Family? The Basics of Bankruptcy Discussion, Research, and Essay Questions . Mythology and Merchandising The End of Eaton's: Retail Evolution She started to leaf through the catalogue the Eaton company sent us in the mail every year. My mother was proud. She didnt want to buy our clothes at the general store; the only things that were good enough for us were the latest styles from Eatons catalogue. From Roch Carriers short story The Hockey Sweater Roch Carriers short story The Hockey Sweater was originally written in French as Le Chandail, later translated into English, and then it became a charming animated National Film Board film. It tells the tale of a young French-Canadian boy growing up in a small town in Quebec. He, along with every other young boy in the town, is an ardent Montreal Canadiens fan and dreams of the day that he can be exactly like the star player, Maurice (Rocket) Richard. Every day during the cold Quebec winter, the boys congregate at the outdoor ice rink to play hockey; each wears the Montreal Canadiens jersey; each wears Maurice Richards famous number 9. One day the boys mother notices that his hockey sweater is getting old and torn and decides to buy him a new one from the Eatons catalogue. Unfortunately, in error, Eatons sends the mother a sweater from the traditional rival team, the Toronto Maple Leafs! Being too proud to return the sweater and afraid that she might offend Monsieur Eaton because Monsieur Eatons an Anglais; hell be insulted because he likes the Maple Leafs, Rochs mother makes him wear the sweater. And so the boys troubles begin. The Hockey Sweater is also a story about fitting in, and about the two solitudes within Canada: the French and the English. It is a story about hockey; it is a story about icons. And in Canada, as we see in this story, Eatons is one of those icons. Many in Canada grew up dreaming about all the wonderful things displayed in the Eatons catalogue. Many watched the wonders of the Eatons Santa Claus parade and remember its fairy-tale Christmas windows. Long before Toys R Us opened its doors in Canada, children would flock to the Eatons toy department to marvel at all the shiny new toys. Eatons was seen as part of our popular history. In recent times, how real was the historical role? Was it simply nostalgia for the good old time? Eatons money-losing catalogue was discontinued in 1976, and Eatons pulled out of its sponsorship of the Santa Claus Parade in 1982 in an attempt to cut expenses. A whole new generation of Canadians grew up without these traditions. And as a result of changing demographics, many families, new to Canada, did not grow up identifying with the Eatons culture. Critics say that, in many ways, Canada changed but Eatons did not or could not. Sacred Eatons Before viewing the News in Review segment on the fall of Eatons, look up the word icon in the dictionary, particularly a recent one such as the Oxford Canadian Dictionary, and discuss its original meaning as well as its secondary meaning as it is used in popular language. Follow-up Discussion and Activities 1. The traditional meaning of the word icon is an object of religious worship. What does the use of the word in reference to Eatons say about Canada, as a culture, if one of our icons is a retail department store? 2. Read The Hockey Sweater by Roch Carrier and then locate and view the NFB film version. Write a one-page commentary in which you describe the icons in the story. 3. What icons exist today in Canadian culture with which you identify as a Canadian? Write your own short story celebrating one of the icons you have identified. Create a display of your work. Introduction Mythology and Merchandising The Changing Retail Environment All In The Family? The Basics of Bankruptcy Discussion, Research, and Essay Questions . Changing Retail Environment The End of Eaton's: Retail Evolution Economists have said that the collapse of the Eatons retail dynasty was the result in part of Eatons slow response to changes occurring in the retail marketplace. Many of these changes have occurred at a staggering pace, given that in markets, historically, goods, services, and the advertising of them required more time to reach the consumer than is usual today in marketplaces enhanced and accelerated by television and the Internet.
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