Hudson's Bay to resurrect discount retail chain Zellers

Discount department store Zellers hopes to make a comeback next year, a decade after the Canadian chain shuttered most of its locations.

Hudson's Bay Co. says Zellers will debut a new e-commerce website and expand its brick-and-mortar footprint within select Hudson's Bay department stores across the country in early 2023.

The company says the relaunched Zellers will offer "a digital-first shopping journey that taps into the nostalgia of the brand."

In an email to CBC News, a spokesperson for Hudson's Bay did not confirm where the new Zellers stores will be located.

Initial inventory will include housewares, furniture and toys, with apparel to be introduced later in the year. The company also plans to launch a private brand, according to the release.

Lawsuit over Zellers brand ongoing

The return of Zellers comes as soaring inflation drives consumers to discount retailers in search of lower prices. It follows Tuesday's announcement fromHudson's Bay thatoutdoor gear retailer MEC will open shops in three Bay department store locations this fall.

It also comes amid an ongoing lawsuit over a Quebec family's use of the Zellers brand.

The Moniz family is behind various recent trademark applications and corporate registries, including Zellers Inc., Zellers Convenience Store Inc. and Zellers Restaurant Inc.

In a statement of claim filed last fall, HBC accused the Moniz family of trademark infringement, depreciation of goodwill and so-called passing off the deceptive marketing or misrepresentation of goods.

Bruce Winder, a Toronto-based retail analyst, said he believes the Zellers revival is partlya reaction to the lawsuit.

"They need to demonstrate that they are still interested in the brand and there's no better way to do that than actually open some stores," Winder said.

Mixed reaction

CBC News heard a range of responses from consumers with fond and not-so-fond memories of shopping at Zellers. Some are hoping for the return of the in-store restaurant and the brand's mascot, Zeddy.

Others expressed hope that Zellers could compete with big-box stores such as Walmart and Giant Tiger.

"I always thought the Zellers was the store that catered to everyone, and I was very disappointed to see it go," said Diane, a longtime resident of Toronto's Richmond Hill neighbourhood.

"And then we had Target. It didn't meet up to the Zellers standards. I would love to see it come back. I think it would service a lot of people from different incomes."

Others recalled bad customer service experiences, a shortage of advertised products and understaffed stores. Some expressed concern that the store wouldn't carry locally made products.

Mark Satov, a strategy adviser at Toronto-basedSatov Consultants who worked with Zellers in the past,is cautiously optimistic about the brand's resurrection.

"They probably have to spend a little less to resurrect this brand than to create a new brand," he said.

Satov added that he doesn't think the brand has a negative connotation among consumers but it wasn't a successful business, which is why it was sold, he said.

"I think it's an OK move. I'm not sure that this is going to be a home run, but let's see."

Others have lower expectations. While the move is meant to capitalize on consumers' nostalgia for the Zellers brand, many will associate the company with a negative shopping experience, according to Craig Patterson, the founder and publisher of retail media site Retail Insider.

"I think people are just excited to get something that was in their lives in the past, and that could be almost anything. But I'm not sure if this Zellers move is going to be a positive one long term for Hudson's Bay," Patterson said. "It really remains to be seen in how it's executed."

"I think that there is going to be an uphill battle in developing this new brand and creating these shops and stores, as well as this entire new e-commerce division for the Hudson Bay Company, which is, again, an expansion for that company."

Most stores closed by 2013

The Zellers department store was founded in 1931 and acquired by HBC in 1978.

It operated as the discount division of its flagship Hudson's Bay department stores, with the slogan "Where the lowest price is the law."

The store hit its peak of about 350 locations in the late 1990s, before losing ground to big-box competitors such as Walmart.

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

The retailer kept a handful of Zellers locations open as liquidation outlets until 2020.

The company launched a pop-up Zellers shop inside Hudson's Bay department stores in Burlington, Ont.,andAnjou, Que., in 2021.