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After Bed Bath & Beyond kicked off store closing sales and stopped accepting its infamous 20% off coupons in April, a home goods e-retailer launched by one of the bankrupt company’s former executives was among the many businesses that stepped up to honor the offer.

The discount was near and dear to Hank Reinhart, as the retail industry veteran from Teaneck worked at the company’s corporate headquarters during the heyday of the beloved oversized blue-and-white coupon as vice president of customer service.

Following news that Bed Bath & Beyond would no longer let shoppers use the offer – an announcement that Reinhart described as “the unavoidable end to an American advertising icon” – he not only gave customers 20% off an entire purchase, but he took it a step further.

Now, as the founder and president of Sabâvi Home, a B2C website offering a curated assortment of high-quality, ethically made products for the home and time-saving kitchen gadgets, Reinhart organized what he calls the “Big Blue Roundup.”

Instead of throwing away that stash of Bed Bath & Beyond coupons tucked away in a drawer, Reinhart encouraged consumers to mail them in through June 30 for a chance to win a $500 gift card from Sabâvi Home.

When asked how many coupons were collected, Reinhart said, “I will say only that, based on my knowledge of how many coupons have been distributed over the years, I am disappointed to not have received many more.”

As for the coupons he did receive, Reinhart plans to upcycle them so they don’t end up in the trash and is seeking creative reuse ideas for an item that is “part of our American cultural fabric.”

“I know what they mean to people,” he said. “I was actually in charge of making all of our customers happy. I was on the front lines and the coupons was a big part of that. I know customers have hordes of coupons in their glove compartments and junk drawers.”

Besides being “a very attractive thing from a pricing perspective with customers,” Reinhart said the coupon is “obviously something very close to my heart.”

“I was involved in coupon policy, I was involved in executing coupons both in the call centers and in all the stores because I was responsible for service all over. So, I have a pretty good understanding of the emotional attachment that many of Bed Bath customers had to the coupon,” he said.

Customer-centric focus

As vice president of customer service for the big box retailer, Reinhart was focused on expanding the customer base through strategic partnerships and new marketing programs, increasing transaction value and improving the overall customer experience across physical, digital and marketing channels.

“When I arrived at Bed Bath in 2004, they were still in a growth mode, but they were pretty big. They were probably around 600 stores – not yet at their peak of a little over 1,000. But they really were growing at their maximum rate and the business was trending very well. The brand was very healthy and so it really was a good position to be in,” he said, adding,” I also think the culture of Bed Bath, the senior management and the senior executives were really focused on customer service.”

“One of my primary responsibilities was really the culture of the company and maintaining and strengthening the culture of the company, which Bed Bath had a very strong one, until the last few years, obviously,” said Reinhart, who left the company in early 2020, just before the pandemic hit.

During his 16 years with Union-based Bed Bath & Beyond, Reinhart was instrumental in the success of some of the retailer’s most well-known initiatives: the gift registry program and the Big Blue coupon.

While the offerings were in place prior to his arrival in 2004, Reinhart took both to the next level, helping accelerate the chain’s growth in a customer-centric way that differentiated Bed Bath & Beyond from the competition.

Starting out with Bed Bath & Beyond as gift registry director, Reinhart sought to set the company apart from the pack by offering couples guidance from associates trained in helping them make selections to build their registry.

“You’re talking about a relatively young couple getting married and having the opportunity to pre-select items that others are going to buy for them is one of the very few socially acceptable times to do that,” said Reinhart, who added, “Maybe having a baby is the other time really.”

“It’s a wild concept, actually – that you can just go out, make a list of items at various price points and people will buy them for you. So, I spent a lot of time investing in redoing the training of Bed Bath and working on it, particularly the store experience,” he said.

“The analogy I like to use is pulling into the gas station. When you’re in New Jersey, you don’t get out of your car, someone helps you, but virtually everywhere else, you have to get out and do it yourself. Going to some of these other major competitors – while they’re great stores and great brands – if you were 25 to 30 years old getting married and you wanted to get some really good stuff that will last a long time but not sure of whether to get stainless steel cookware or aluminum, which coffee maker to get or the best towels, people needed help with that,” he said.

“We really worked on emphasizing that. I also brought in a brand-new agency to sort of rebrand the wedding registry within Bed Bath & Beyond to appeal to a younger customer and more of who we were after. And that strategy worked very, very well for many years, north of 10 years,” he said.

Feeling blue

The home goods chain’s everyday low prices, combined with its coupon, proved to be a successful strategy to lure in repeat shoppers, making Bed Bath & Beyond a fierce competitor in the world of retail.

Described by The New York Times as “an oddball marketing achievement” in which “the promotion became a stand-in for the brand itself,” the coupons could be found in millions of mailboxes across the country at one point. It also evolved into a bona fide cultural phenomenon that popped up everywhere from notorious gangster Whitey Bulger’s junk drawer to the movie “Old School” to auctions on eBay.

“The coupon started many years before I got there – it was somebody’s idea to get people in our store back when the company was still relatively small and young,” Reinhart explained. “And what the coupon afforded the customer was the ability to choose what was on sale. Whatever you wanted to be on sale, is on sale.”

“And, in addition, the stores did not enforce the expiration dates on the coupons. So, number one, it was a sale on demand and number two, there was a psychological effect for consumers that they were sort of putting one over and getting away with something, even though the store condoned it and allowed it,” he said.

“But from a consumer’s perspective, it’s like, ‘Oh my God, I got this great deal. The coupon expired and they let me use it, and I got my toaster at 20% off,’” said Reinhart, adding, “So, that was a very powerful thing.”

However, as the retail industry changed, the once-popular marketing tool wound up backfiring for Bed Bath & Beyond by eroding profit margins. As e-commerce grew, coupons became a less effective way to get customers into the store because they could now compare prices across different sites to find the lowest one.

While known for reliably accepting coupons past expiration, Bed Bath & Beyond found there were challenges associated with bringing Big Blue online.

“The manufacturers and the brands that did not want their brands discounted could enforce it [expiration date]. Whereas when it was in the stores, everybody would look the other way. Even though it said these brands are excluded, most customers would come in and use it and get the discount on those brands. When it was online, they couldn’t do that because it was visible to the whole world, meaning you could just go in and try and put something in that brand and the brand would see it and the competitors would see it. So that put an end to that,” Reinhart said.

“And additionally, they enforced the expiration date because of the technology. They couldn’t just let it go on forever, with all these coupons out there,” he recalled. “The coupon limitations that were put in place online that didn’t exist in stores were a tremendous deterrent to shopping at Bed Bath and they never addressed that fully.”

“What actually happened is that if you went into Bed Bath & Beyond and used a coupon, you could buy the item below the MAP [minimum advertised price] and that was a competitive advantage that no one else had,” he said. “Now, when you took the business online, you lost that advantage.

“And, because Bed Bath could not sell below the MAP pricing online, they had to price the item, let’s say 20% higher than the MAP price. If someone’s searching for an item, all of the results would come up and Bed Bath would look like they’re overpriced, even though the customer had a coupon. And, if they priced it at the MAP price online, they couldn’t offer that 20% discount coupon. It was a little bit of a checkmate, and this is something that even before I left the company, I was involved in suggesting solutions,” he said.

A better home

Launched a year ago, Sabâvi Home sells a curated selection of around 4,000 items, ranging from kitchen to dining to décor to bed and bath, all of which come with a fair price commitment and aim to make home a place that is a more enjoyable and peaceful place to be.

According to Reinhart, almost every item on the site is sold at the lowest price allowed by the manufacturer, taking cost out of the equation so that a customer’s purchasing decision can be based on factors like customer service and trust.

“We saw it best during the pandemic, when people were really forced to spend a disproportionate amount of their time in the home,” he said. “During that period of time, the home business was fantastic because people had money – they were not able to really travel or even leave the house very much at certain points in time, so they invested in making their home a more comfortable environment.”

“The idea of my business is to present customers with really beautiful, high-quality products at the lowest price available on the market. And I’ve done the curating and the shopping for them, so they know when they come to Sabâvi Home, they’re getting items that are high quality,” said Reinhart.

To find up-and-coming products, Reinhart attends trade shows across the U.S. and Europe to discover cutting-edge items and sources from brands and companies that are sensitive to environmental and sustainability issues.

When he’s on the hunt, Reinhart seeks out items “that are unique and different – whether it’s decoratively really appealing, has an extra functionality or is something that’s new and novel,” said Reinhart. “Or products that might have been around for a while, but that customers may not be familiar with.”

One of Sabâvi Home’s best-sellers is a pair of pizza scissors made by Dreamfarm, an award-winning Australian design company that makes kitchen tools that “solve problems.”

“It’s a $35 item that works so much better than the traditional pizza wheel and is an item that I like to share with people and say, ‘Did you know it exists?’ Most households eat pizza – and some of them eat a lot of pizza. This is the kind of item I share with my friends, they buy one for themselves and then they buy two or three more for their kids,” Reinhart said.

‘Not out to become Amazon’

With “literally hundreds and hundreds of thousands of online and brick-and-mortar stores that sell goods for the home,” the home goods retail space is unlimited, making it crucial for companies to “choose a lane and define your brand,” Reinhart said.

Sabâvi Home seeks to “fill a niche in the marketplace by identifying and building a business around items that can really enhance your home and your life at home,” said Reinhart, adding “I’m very intent on providing a global assortment of merchandise, but with real small-town values, a real family-owned store kind-of approach in terms of service and making sure that people are happy, being responsive and treating customers the way I always expect to be treated.”

He went on to say, “I’m not trying to compete with Amazon and I’m not out to become Amazon. My ideal is to have a small community of customers who I can treat really well, who shop regularly – whether it’s for their own home again or for gifts for any occasion – and that I can provide that for them and service them at a very high level. And I think we’re well on our way to building that brand, but it’s certainly not an easy or a quick process.”

“I’m starting from scratch, literally sitting at an empty desk and a blank screen – not walking into a billion-dollar corporation and saying ‘How do I make things better?’ Here, it’s like ‘What am I trying to make and how do I get it done?’ I had started my own business once before back many years ago and I had a partner. That was a good experience,” he said, adding, “I’ve always been an entrepreneurial spirit in a large corporate entity … Every decision I’ve ever made in any company was ‘What would I do if this were my business?’ It’s just the way I’m wired – I’m probably fortunate to get that thinking and approach from my father, who had his own business, albeit not in retail.”

While a brick-and-mortar storefront has not been ruled out, Reinhart said the focus right now is on smart growth.

“I spent many months before that building the infrastructure, but it’s really like any new business, it’s quite an evolution in terms of site functionality, in terms of merchandise assortment, in terms of marketing,” he said. “I’ve done very little marketing and I’m about to try to increase that, because the site and the business operation is in a position where it can handle it.”

“Because of my experience, I’ve been trying to build everything in a position to scale so that if the business grows multifold – which I’m counting on and doing that – the infrastructure, the operational processes, the systems, everything that’s being done internally can handle that growth and it’s not going to break. It’s sort of like a restaurant that can handle four tables, but it gets really busy one night and they can’t handle that,” he said.

Moving on

As recently as 2018, Bed Bath & Beyond had more than 1,500 stores across the U.S. And during the Great Recession, when many retailers closed for good, Bed Bath & Beyond grew. But, as internet and mobile shopping became more popular, the chain failed to embrace digital, losing business to rivals with more established online platforms, such as Target and Amazon.

Reinhart said, “When we were competing in stores, we were pretty much the best in terms of all of our major competition. When we went online, if you think about what really differentiated Bed Bath & Beyond, specifically with registry in terms of the customer experience, in terms of the coupon and pricing and in terms of the assortment of merchandise, all of those were either neutralized or negated by the growing popularity of the internet,” he said. “And quite frankly, Bed Bath never did a great job responding to that and pivoting.”

By the late 2010s, sales were dropping, and the company launched a series of turnarounds under Mark Tritton, a former Target executive. Faced with a prolonged slump, the Bed Bath took steps aimed at propping up the business, including scaling back its coupon program, closing underperforming stores and replacing national brands with its own store label products.

Despite new Chief Executive Officer Sue Gove’s attempt to save the business, Bed Bath & Beyond continued to struggle with losses and cash burn, prompting it to issue a going concern warning in January and then eventually file for Chapter 11 bankruptcy protection three months later.

After being unable to find buyers willing to keep Bed Bath & Beyond stores and Buybuy Baby locations up and running, the company has taken several steps in recent weeks to end its 52-year-old business.

On June 27, e-commerce site Overstock.com’s all-cash $21.5 million bid for Bed Bath & Beyond’s name, intellectual property and digital platforms received court approval.  Meanwhile, on July 11 a bankruptcy judge signed off on the $15.5 million sale of Buybuy Baby’s trademark and digital assets to one of the banner’s former vendors, Piscataway-based baby goods retailer Dream On Me Inc.

As for Bed Bath & Beyond’s brick-and-mortar footprint, the company is in the process of auctioning off its 250 namesake stores and 120 Buybuy Baby locations.

Burlington has since emerged as one of the top bidders for vacant Bed Bath & Beyond properties, with the South Jersey-headquartered off-price retailer spending $13.5 million to secure the leases for 50 stores.

Reinhart said, “It’s a sad time to see a business unwind and really draw down the way Bed Bath has over the last few years. Most of all, it’s very sad for the people that were still there or are still there, but it’s also a little bit sad for customers. Things change in life. It’s sad to see it happen, but we all learn to adapt and move on. And I’ve done the same personally and in launching this business [Sabâvi Home] and I’m hoping that more and more customers will do the same and check us out.”