How Bed Bath & Beyond Reversed Its Comparable Sales Slump

Crank “The Final Countdown” and stretch for some stair sprints. It’s time for a turnaround montage, courtesy of an unlikely home goods retailer.

Bed Bath & Beyond reported its comparable sales rose 6% in the three months ended August 29—the first time the all-important metric has increased at B-cubed since 2016. Its e-comm sales jumped 89%.

Right place, right time. Anyone in the redecoration biz is enjoying a quarantine boost, Bed Bath & Beyond included. Across retailers, housewares sales increased 28% in the three months ending in August, per the NPD Group.

But unlike other home retailers, many of BBB’s two million newly acquired customers were TikTok majors with a minor in dorm decor.

• Sales of items geared toward college students increased by 21% from May to September.
• A new discount pass for undergrad shoppers generated 400,000+ transactions.

Montage, take two

This comeback wasn’t totally dependent on the Extreme Makeover: Home Edition marathon we’re all living in. New-ish CEO Mark Tritton has followed up last fall’s headcount-cutting strategy with a rush of strategic initiatives, including...

Store overhauls. The company is parting ways with unprofitable stores; 63 are due to close this year. 25% of remaining stores were converted to online fulfillment centers. That’s essential to the next step...

Omnichannel expansion. Bed Bath & Beyond implemented curbside pickup just as consumers’ confidence in their bread baking abilities rose. After adapting early, BOPIS services made up 15% of digital sales; stores fulfilled 36% of online orders in Q2.

• Tritton said BOPIS transactions share in-store sales’ thick profit margins.

Precise discounts. Coupon expenses declined during the quarter, even with the aforementioned collegiate discount program’s debut.

Looking ahead...Bed Bath & Beyond is delving into private label brands and same-day delivery—two initiatives that track well with customers.

My takeaway: We can’t call Bed Bath & Beyond’s renovation complete until its sales gains extend for more than a quarter. And Twitter knows it still has stores to clean up.