Zellers Brand Check-up: Nostalgia Without a Front Door
Zellers closed its last two stores in January 2020. In March 2023, Hudson’s Bay brought the name back as shops inside its own department stores, with food trucks, a throwback logo and a new private label. As of January 28, 2025, we look at whether a well-loved Canadian discounter can live on nostalgia and borrowed floor space.
Key takeaways
- Zellers was squeezed by Walmart and other discounters, and in 2011 Hudson’s Bay agreed to sell leases for up to 220 of its stores to Target for C$1.825 billion.
- The 2023 revival put Zellers into 78 Hudson’s Bay stores, but a Leger poll in April 2024 found only 9% of Canadians had shopped or browsed it.
- Only 19% of Canadians in that poll agreed Zellers offered better value than Walmart, Marshalls, HomeSense or Dollarama.
- The brand depends on a host that was reported to have fallen behind on supplier payments in 2023 and was recapitalized in December 2024.
Download the full Zellers Brand Check-up (PDF): vital signs, timeline, diagnosis, treatment and sources.
A discounter built on price
From 1988, Zellers advertising said the lowest price is the law. By 1998 the chain had 298 stores, and Retail Insider puts its 1990s peak at over 350. Walmart entered Canada in 1994 by buying 122 Woolco stores, and the Financial Post listed Walmart, Giant Tiger, Costco, Dollarama and Amazon as the competitors that pushed Zellers out.
In January 2011, Hudson’s Bay Company (HBC) agreed to sell leases for up to 220 Zellers stores to Target for C$1.825 billion. HBC closed the rest in 2013, except three. The last two, in Etobicoke and Ottawa, closed in January 2020.
The 2023 revival
HBC announced the return in August 2022. On March 23, 2023, the first 12 Zellers shops opened inside Hudson’s Bay stores in Ontario and Alberta, along with a new zellers.ca site. By September, HBC said pop-ups would bring Zellers to 78 Hudson’s Bay stores. The 24 main shops (a 25th was coming) run 8,000 to 10,000 square feet. Most pop-ups run 1,000 to 2,800.
The launch leaned hard on memory: a throwback logo, food trucks serving dishes from the old Zellers restaurants, and whole-dollar prices. The product side was smarter. Zellers secured exclusive distribution rights to Anko, a private label developed by Kmart Australia. Shoppers come back for product and price, not for a logo.
Symptoms
- No standalone Zellers store has operated since January 2020.
- Awareness is high and trial is low. In an April 2024 Leger poll of 1,605 Canadians for Retail Insider, 56% knew about the new shops, but only 9% had shopped or browsed them.
- The value claim is not yet believed. In the same poll, 19% agreed Zellers offered better value than Walmart, Marshalls, HomeSense or Dollarama, and 19% disagreed.
- The host is under strain. Retail Insider reported in 2023 that Hudson’s Bay had fallen behind on supplier payments.
Diagnosis
Nostalgia did its job. It earned news coverage and a first look. But memory buys one visit. A discount store needs a reason to come back every week, and that reason is price and range. Zellers spent its relaunch on stored memory and has not yet built the sales activation that turns a visit into a habit.
Placement is the second problem. A discount brand sits inside a department store whose own position is unclear. York University marketing professor Ela Veresiu, speaking to CBC News, contrasted Zellers’ discount image with a Bay seen as “a confused retailer that doesn’t know what it is anymore.” In some malls, including Scarborough Town Centre, Zellers sits on an upper floor. A value shopper has to walk through a department store to find it, which weakens the brand’s positioning before the first price tag.
Third, the brand was left unguarded while it slept. The Zellers trademark was expunged in September 2020 after HBC reportedly failed to renew it. A Quebec family registered Zellers companies and opened Zellers-branded stores, and HBC reportedly went to court over a name it had shelved.
Prognosis
As of January 28, 2025, Zellers depends on its host. Hudson’s Bay was recapitalized and financed separately from Saks Global when that company closed its Neiman Marcus purchase on December 23, 2024. We would watch whether the Bay keeps shelves stocked and suppliers paid, and whether Zellers can turn high awareness into repeat visits.
Treatment
- Choose one job to be done, such as low-cost home and kids’ basics, and make Zellers the obvious answer for it.
- Prove the value claim on a short list of everyday items, priced against the discounters shoppers already use.
- Use nostalgia to earn the first visit, then lead with Anko design and everyday low prices.
- Track trial, repeat visits and sales per square foot by location, and close pop-ups that do not earn their space.
What growing companies can learn
An old brand memory is an asset, but it is not a plan. Before you revive a name, check that the old job still needs doing and that you can do it better than the rivals who filled the gap. Put the brand where its customers already shop. And keep renewing the trademarks for any brand you might want back.
This check-up uses public information available on January 28, 2025. It is brand and marketing analysis, not investment advice.
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