12 Brands Likely To Disappear

As the recession deepens, economic forces continue to drive consolidation in the retail industry, debt comes due and increasingly discerning consumers buckle down on discretionary spending, an analysis by 24/7 Wall Street predicts that a number of well-known brands are likely to disappear before the end of 2010.

To determine which brands are most likely at risk, 24/7 Wall Street examined 100 large brands it believes are in trouble and, for each, looked at public financial records, sales information, analyses from industry experts, the competitive landscape in each’s industry and the likelihood that a brand could be sold off in the case of parent-company financial trouble.

The analysis points to the most serious peril for the following 12 brands which, 24/7 Wall Street says are most likely to disappear by the end of 2010:

1. Budget rental cars: Though Budget’s parent company currently says it will continue to operate both the Avis and Budget brands, increasing debt problems, a weakening travel industry and intensifying competition will nonetheless cause the demise of the Budget brand, 24/7 Wall Street predicts.

2. Borders books: Declining sales, heavy losses and pressure from competitors Barnes & Noble and Amazon - especially from new e-book readers - may prove too much for the brand when large amounts of debt come due in April 2010.

3. Crocs footwear: The decline in stock price from $72 per share in late 2007 to $2 today, ongoing financing issues, consumer belt-tightening and the end of a fad, leads to to 24/7 Wall Street’s declaration that “Crocs won’t make it through the year.”

4. Saturn vehicles: As General Motors faces bankruptcy, 24/7 Wall Street said it will almost certainly shutter the brand, whose sales dropped 59% in the first quarter of 2009.

5. Esquire Magazine : While the Esquire brand is plagued with ad revenue declines and intense competition in the crowded men’s-magazine market, parent company Hearst faces problems on both the newspaper and magazine fronts and will not hesitate to close down underperforming brands such as this one to bolster its overall position.

6. Old Navy apparel: 24/7 Wall Street said that parent company Gap - which currently markets the Gap, Old Navy and Banana Republic brands - is “a three-brand company living in a two-brand body” and cannot continue to sustain all three in the midst of steep, across-the-board sales declines. Old Navy, which is the weakest brand, will most likely not survive.

7. Architectural Digest Magazine: Amidst drastic cutbacks in high-end home sales and expensive redecorating, the once-healthy publication has lost 47% of its ad pages this year. Faced with other financial problems in its newspaper and magazine businesses, parent company Conde Nast will not be able to sustain the brand, according to 24/7 Wall Street.

8. Chrysler brand cars: Facing similar problems to GM as it teeters on the edge of bankruptcy, Chrylser LLC will not be able to support product design, manufacturing and marketing for a brand with many less sales that Dodge or Jeep as it gears up for restructuring.

9. Eddie Bauer: Faced with declining sales, a stock price under $1, major debt problems and a CCC- rating, analysts say its lack of differentiation in the marketplace could prove the last straw. 24/7 Wall Street said it could be out of business by mid 2009.

10. Palm: A brand that 24/7 Wall Street says has been “at death’s door for some time,” faces life-threatening competition from RIM and Apple, and can only survive in the unlikely event that it can expand the smartphone market by increasing demand for its “Pre.” Dismal financial results and association with Sprint, the already-#3 US wireless carrier, will spell complete disaster.

11. AIG: The once-venerable insurance giant’s highly publicized financial problems, involvement in the financial crisis and subsequent bailout and indebtedness to the federal government, make it the “one large brand in America which almost everyone would like to see disappear,” according to 24/7 Wall Street. Because many of the company’s operating units do not bear the AIG name, they will continue to do business as they distance themselves from the “toxic” AIG parent brand, which eventually will go away.

12. United Air Lines: As the travel industry faces unprecedented overcapacity in light of the recession, two of the large US carriers will soon need to merge to avoid bankruptcy. While it is not clear yet how such a consolidation will shake out, the stocks of UAL, American and US Air have plummeted. 24/7 Wall Street believes that United - the weakest of the carriers, soon faces a “merger,” which will most likely mean the end of the line for the brand.

source

Re: 12 Brands Likely To Disappear

Nooooo, no more Borders???

Re: 12 Brands Likely To Disappear

i have noooooo problem letting go of the Crocs brand AT ALL.

i do love me some old navy -- i hope they don't absorb the brand into Gap stores with Gap prices!

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I thought I heard that the Gap stores were closing??

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I find it hard to believe that Old Navy would go away over Gap. They've been closing Gap's all over out here in AZ (can only find one in 2 malls in all of Phoenix) but they keep building new Old Navy's.

Re: 12 Brands Likely To Disappear

Interesting but I'll be shocked if all those companies listed disappear.

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Old navy and Saturn surprise me- I thought that Old Navy was actually the strongest of the brands

I had also heard that Saturn was not going to be part of GM after this year- that they were spinning out on their own since they were doing so well

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Saturn makes me sad...I always thought they were a quality car company, very customer focused...like that commercial they have on - where if you lose your job they make your pmts for a certain amt of time..

Borders scares me bc I work for a book publishing / distribution company.. but luckily B&N is one of our largest customers.

Re: 12 Brands Likely To Disappear

I have to say none of them surprise me, except Old Navy. Love ON, especially for my kids!!

Saturn is already a done deal. They are only going to operate for the next 5 years and then that's it.

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It's sad to see ANY businesses fold. I remember when Eddie Bauer was a bigger brand and in all the malls Old Navy has gone way downhill in recent years

Still sad

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You can take all the ON's in the world away but please don't ever take away my Gap

Re: 12 Brands Likely To Disappear

Posted by azoodie

You can take all the ON's in the world away but please don't ever take away my Gap

Re: 12 Brands Likely To Disappear

I would think Old Navy would be stronger than the Gap.

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I haven't shopped in the Gap since HS. The style there has never changed. Same things.. over priced & the quality has gone downhill. I never find anything in there ever.

I will be really sad to see Old Navy go. I shop there for summer stuff every year.

Re: 12 Brands Likely To Disappear

I haven't shopped at the Gap for myself in years either (well, other than their maternity section). I do still pick up some things at Old Navy--their quality is equal to the Gap IMO, but the cost is lower. I'd be sorry to see Borders go too. All the others, eh.

Re: 12 Brands Likely To Disappear

FYI - AIG backs Best Buy's warranties so please keep that in mind!

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Oh man....I love borders..

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It will be a shame if Palm goes under because the Palm Pre is going to absolutely SMOKE the iPhone.

It won't even be close. The Pre will have everything the iPhone currently has, along with a ton of things that iPhone should have put in.

I can't wait for the Pre... will be my next phone.

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Posted by azoodie

You can take all the ON's in the world away but please don't ever take away my Gap

Re: 12 Brands Likely To Disappear

The majority of that list I have never bought from and the ones I have I have not bought in years, so I'm not surprised. I'm sure there are alot more than that.

Re: 12 Brands Likely To Disappear

Posted by dpli

Nooooo, no more Borders???