Buybuy Baby Celebrates Return to Brick and Mortar
Buybuy Baby was always the stronger retail banner when compared with its former parent Bed Bath & Beyond.
Crib manufacturer Dream On Me Inc., which acquired the baby banner last July, made good on its promise to bring back the nameplate online and in the brick-and-mortar channel. BuyBuy Baby’s website relaunched in November, in time for the holiday shopping period. And the 11 retail doors Dream On Me acquired reopened for business on Nov. 18. Those stores include four in New Jersey in Paramus, Cherry Hill, Bridgewater and Iselin; two in New York in Scarsdale and Amherst, and one each in West Hartford, Conn., Newark, Del., Rockville, Md., Braintree, Mass., and Springfield, Va.
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On Saturday and Sunday, the company will be kicking off a week-long series of events to celebrate the reopening of those doors and the “official unveiling” of its digital site. The events are aimed at showcasing live events, safety workshops and its baby registry.
“Buybuy Baby is proud to reclaim the top spot as the leading specialty retailer in the baby space by offering customers an elevated shopping experience, a curated assortment anchored with the best brands and the guidance and expertise to support parents at each milestone,” Pete Daleiden, CEO of Buybuy Baby, said. “We believe there is no substitute for the combined power of our in-store experience and our digital platform to help parents make the most informed decisions for their families.”
The crib manufacturer was a former supplier to the baby retailer when it was owned by the defunct Bed Bath & Beyond Inc. Following Bed Bath & Beyond’s filing for Chapter 11 bankruptcy court protection in April 2023, its assets were auctioned off. Dream On Me acquired Buybuy Baby’s intellectual property and other digital assets for $15.5 million. It subsequently acquired the leases to 11 store locations for $1.17 million. Overstock.com acquired the Bed Bath & Beyond non-store assets for $21.5 million.
Bed Bath & Beyond attempted several “Hail Marys” to buy itself more time to avoid a full-blown collapse after self-inflicted missteps. One that it has been criticized for was its failure to sell the Buybuy Baby banner in Fall 2022 when it was valued for around $630 million to $910 million. While it would have given Bed Bath & Beyond a much needed cash boost, it might not have made much difference in the end other than to push out the timing of its Chapter 11 filing.
Overstock last August rebranded itself as the new Bed Bath & Beyond, hoping that the better known nameplate would help it shed its liquidator image. Overstock began life as an excess or closeout site, selling inventory across multiple categories that included home, apparel, shoes, lighting, handbags and luggage. The company went public in May 2002. Jonathan Johnson took over as CEO in 2019. He pivoted the business model in 2021 to focus on home goods and furniture.
“Overstock has a great business model with a name that does not reflect its focus on home. Bed Bath & Beyond is a much-loved and well-known consumer brand, which had an outdated business model that needed modernizing,” Johnson said in August. “Through this rebranding, we’re breathing new life into Bed Bath & Beyond, positioning it as an asset-light, e-commerce retailer with an expanded home furnishings and furniture assortment. Think of it as Bed Bath & a much bigger, better Beyond.”
But the shift hasn’t been as easy one, with the former Overstock operation still undergoing growing pains. And the verdict is still out on whether the change was the right decision.
The company posted third quarter-earnings results—it widened its net loss to $63 million on an 18.9 percent revenue decline to $373.3 million—in October. Johnson said during a conference call that the company would relaunch its old Overstock.com name for a site dedicated to closeout home goods. But one month later, the company’s new corporate name became Beyond Inc. and Johnson exited the firm, replaced by president David Nielsen who took on the expanded role of interim CEO. The company last year also parted ways with its chief marketing officer and chief technology officers. A search is underway for a new CEO, CMO and CTO.
Jefferies hardlines analyst Jonathan Matuszewski last October reiterated the “Hold” rating on shares of Overstock, noting that while there was ongoing progress, challenges remained. He cited a concern regarding the “backdrop of recession-like conditions for home furnishings.” In his December report, Matuszewski said Beyond has the “most on its plate” in 2024, with agenda items that include plans to relaunch Overstock.com, offer warranties and services, and bolster its presence in the trade community.
The home furnishings category was particularly hard-hit in 2023, with many of the retail bankruptcies last year occurring in the sector. Credit experts have cited the home furnishings category as the one with the highest default risk across retail since 2021, according to data from S&P Global Market Intelligence.
