8fbd035081bd09934004bfc61d79c31c5d5d9ee4

Why Walmart’s new bet on fashion brands, home decor threatens specialty chains, ET BrandEquity

Price-conscious shoppers flock to Walmart Supercenters to pick up $1 potato chips and $3 gallons of milk, but the world’s biggest retailer will now try to sell them $298 cozy swivel chairs and $50 Wrangler jeans, too.

Using low-cost and low-margin groceries as a draw, Walmart is adding more than a dozen new lines of pricier, more profitable merchandise including six through partnerships with celebrities like Drew Barrymore and Sofia Vergara.

The company wants to change its image from merely a steep discounter to a destination where customers can also purchase fashionable home goods and clothing.

T-shirts from Reebok, accessories from Justice and men’s dress shirts from Chaps are among the national brands Walmart is highlighting in its renovated “Stores of the Future.” Most of the goods are priced between $15 and $50, Denise Incandela, vice president of apparel and private brands, disclosed at a June 6 conference with investors.

Walmart historically has marketed mostly its own brand of clothing: basic George t-shirts, shorts and pants, typically priced at $15 or less. But Incandela, a former Saks and Ralph Lauren executive, said Walmart’s research showed that 80% of its customers were purchasing higher-priced clothes elsewhere.

She told Walmart investors its strategy is to “democratize fashion” or convert the company’s core, price-conscious shoppers into style-conscious shoppers.

“It is a huge transformation on the apparel side,” she said.

Americans shop for clothing, footwear , chairs and lights from millions of mom-and-pop stores, regional chains and online platforms every day, analyst say, giving no one retailer outsized dominance in the highly fragmented markets for home decor and apparel.

But smaller retailers have a hard time competing with Walmart because of its scale and size and its well-known history of squeezing suppliers on prices by promising them volume sales.

Walmart’s strategy “is a

Read the rest

Analysis: Why Walmart’s new bet on fashion brands, home decor threatens specialty chains

June 15 (Reuters) – Price-conscious shoppers flock to Walmart Supercenters to pick up $1 potato chips and $3 gallons of milk, but the world’s biggest retailer will now try to sell them $298 cozy swivel chairs and $50 Wrangler jeans, too.

Using low-cost and low-margin groceries as a draw, Walmart is adding more than a dozen new lines of pricier, more profitable merchandise including six through partnerships with celebrities like Drew Barrymore and Sofia Vergara.

The company wants to change its image from merely a steep discounter to a destination where customers can also purchase fashionable home goods and clothing.

T-shirts from Reebok, accessories from Justice and men’s dress shirts from Chaps are among the national brands Walmart is highlighting in its renovated “Stores of the Future.” Most of the goods are priced between $15 and $50, Denise Incandela, vice president of apparel and private brands, disclosed at a June 6 conference with investors.

Walmart historically has marketed mostly its own brand of clothing: basic George t-shirts, shorts and pants, typically priced at $15 or less. But Incandela, a former Saks and Ralph Lauren executive, said Walmart’s research showed that 80% of its customers were purchasing higher-priced clothes elsewhere.

She told Walmart investors its strategy is to “democratize fashion” or convert the company’s core, price-conscious shoppers into style-conscious shoppers.

“It is a huge transformation on the apparel side,” she said.

Americans shop for clothing, footwear, chairs and lights from millions of mom-and-pop stores, regional chains and online platforms every day, analyst say, giving no one retailer outsized dominance in the highly fragmented markets for home decor and apparel.

But smaller retailers have a hard time competing with Walmart because

Read the rest