Wal-Mart Sells Out Metro 7 Line

Discussion
Mar 09, 2006
George Anderson

By George Anderson


A new and hipper Wal-Mart is “starting to make a statement,” according to its senior vice president of marketing Stephen Quinn.


That assertion, made by Mr. Quinn during a Bear Stearns Webcast, is a confirmation that Wal-Mart’s plan to upgrade its apparel offerings with the introduction of new clothing lines such as Metro 7 is being well received by the chain’s shoppers.


Mr. Quinn said Wal-Mart “was completely sold out” of its initial stock on the Metro 7 line and was planning to expand into complementary product categories such as shoes and jewelry with the brand.


Calling the Metro 7 introduction “a very important experiment to offer fashion-forward merchandise,” he added, “We found that if you make the fashion apparel available to them, they will buy it.”


Wal-Mart plans to have Metro 7 merchandise in 800 of its U.S. stores this spring. 


Moderator’s Comment: What do you take from Wal-Mart’s initial success with the Metro 7 line? How important is apparel
to the chain’s stated strategy for upgrading its image with consumers who only shop its stores for everyday staples?

George Anderson – Moderator

Please practice The RetailWire Golden Rule when submitting your comments.

Join the Discussion!

12 Comments on "Wal-Mart Sells Out Metro 7 Line"


Sort by:   newest | oldest | most voted
Doug Fleener
Guest
14 years 11 months ago

I think the ability to offer a fashion product that the current customer wants is important for Wal-Mart to maximize their customer base. The trick is to do this with the up-market customer they aspire to bring in. (Read: Target customer.) My guess is, for Wal-Mart to be able to sell that customer clothes, they will first need to be seen as fashion forward for the home. Only after Target was seen as the place to buy well designed and fashion forward for the home did customers make the leap to clothing. Ultimately what’s important is that the consumer thinks Wal-Mart is “hipper” and not that Wal-Mart says so. While Wal-Mart has a long ways to go, it sounds like the Metro 7 line is a good start.

Bill Bishop
Guest
Bill Bishop
14 years 11 months ago

We were in Bentonville just last week and saw the new 187 supercenter that includes a very attractively merchandised (low profile, wooden floor, different quality signs) section featuring the George line of clothing that Wal-Mart has brought to the states from Asda.

This new apparel section was the cornerstone of a bright and more inviting look that spread across the entire store.

From the work we’re doing, shoppers — particularly younger shoppers — want to find “more of what they’re looking for” at the same store, and apparel, be it George or Metro 7, plays a key role in the lifestyle of these important shoppers.

So, Metro 7 sounds like it’s another important building block in Wal-Mart’s future and one that will be difficult for conventional operators to respond to in a direct way.

Gene Hoffman
Guest
Gene Hoffman
14 years 11 months ago

The Metro 7 line is just the first step in a future line-up of image-enhancing contemporary fashions that will grace Wal-Mart stores in the future. When Wal-Mart decides to do something, they usually do it quite well and upgrading their image with current and future consumers is their current obsession. Thus I’m not inclined to bet against them.

Mark Lilien
Guest
14 years 11 months ago

It’s unclear if selling out the new line is an accomplishment because it’s not clear that the line’s profit exceeded what it replaced. Wal-Mart’s domestic profit growth is slowing down. The best way to stop that problem is to gain profitable dominance in the competitively weak categories. Otherwise, growth has to come from more marginal domestic locations and higher-risk locations overseas. To use a cliché, the low-hanging fruit is already picked.

Camille P. Schuster, PhD.
Guest
14 years 11 months ago

Wal-Mart has incredibly rich data through which they can gain great insight into their consumer’s shopping habits. If the data base is used well, Wal-Mart should be able to design new products and sell them AND on a regular basis.

Ryan Mathews
Guest
14 years 11 months ago
And I’m not inclined to bet against Gene…but…I think we have to ask ourselves what lies at the core of Wal-Mart’s brand equity. Is it providing access to mildly aspirational consumer goods at low prices? Is it creating a homogeneous sense of shopper community? Or is it catering to a well defined demographic segment? Kmart made a mistake with Gitano years ago and maybe Wal-Mart is better off trying to grow brands (ala Target) than adapt them (ala Gitano and Kmart). I’m just not sure. Wal-Mart has to extend beyond its comfort zone for growth, but is this really the right direction? Bill Bishop believes more teens want to source products at a single store (fashion’s answer to one stop shopping?). I think I may agree with that in principle but not necessarily in application. It may be true, for example, if that store is Abercrombie or Hollister, but is it still true if that store is Wal-Mart? This is one of those “time will tell” stories, but my bet is that the road to… Read more »
Don Delzell
Guest
Don Delzell
14 years 11 months ago
The phrase “completely sold out” is very strange to hear in the world of apparel merchandising. Achieving a 100% sell through on a fashion delivery is generally accomplished by anyone who uses time-phased markdowns to stimulate final stage sell off. Usually, the metrics used for success in fashion merchandise have to do with x% sold over y period of time…rapid sell through at full price being the best metric for trend-right merchandise. Metro 7 was a huge step forward for WM. The merchandise was carefully designed, priced appropriately, and featured in the most advantageous part of the apparel floor. Massive PR was spent to hype the line. The larger question is what Metro 7 did to overall apparel sales? Was it incremental, or cannibalization of George? Metro 7 is supposed to be an on-going brand. How do you “sell completely out” of an on-going brand? Why would you want to? Apparel merchants often have items, collections, or features which sell through very rapidly. The distinction for WM, probably, is that rather than react to the… Read more »
Phillip T. Straniero
Guest
Phillip T. Straniero
14 years 11 months ago

It seems to me that as Wal-Mart extends its store openings into more urban locations and into more populous geographies (e.g., California) they will need to do a couple of things: the first is to improve its clothing and other fashion offerings to better compete with Target Stores; and the second is to improve its overall appeal to higher income shoppers to develop the numbers of shoppers and revenues needed to payout the higher investments associated with urban store locations.

Art Turock
Guest
Art Turock
14 years 11 months ago

I question not only the Metro 7 launch but Wal-Mart’s overall move into the more upscale market where Target has been so proficient. This type of move violates Wal-Mart’s long-standing strategic principle of finding minimally contested market space. It began in 1962 with Sam Walton locating stores in rural America. It continued in the entry to the supermarket industry by offering “discount groceries” at a price that the conventional stores can’t compete with.

When Wal-Mart has gone head to head, their results haven’t been great. Witness Sam’s Club when it formerly focused on consumers (not small business) and fell short against Costco.

I predict that in a few years we’ll see the same result – Wal-Mart will be an inferior version of Target in most categories where style and aspirational consumables are involved.

will graves
Guest
will graves
14 years 11 months ago
Wal-Marts wants to be the best at everything it does. But they won’t have this one! Target is so far ahead of Wal-Mart in its understanding of what “trend right” upscale discounting is all about. Recent shipments of Metro 7 apparel to my local Wal-Mart offered styles that seemed forced, trying too hard to replicate Mossimo clothing offered at Target. The fact that Wal-Mart is “selling out” of its new brands is especially troubling. How can it establish strong brand relationships with its customer if it isn’t consistently providing them with the merchandise they need? Successful clothing retailing implies shipping the new styles to the stores before the other ones run out, and then marking down the old. Furthermore, size selection is important. Target is very skilled when it comes to keeping the various sizes of each style stocked. In fact, it is so sophisticated that it has planogram labels for each size and color on each folded table and lingerie rack! Does Wal-Mart have any such method of inventory management to ensure that sizes,… Read more »
Stephan Kouzomis
Guest
Stephan Kouzomis
14 years 11 months ago

Wal-Mart is just beginning to head in the right direction in order to capture the absent, higher income and/or more affluent shopper, like Target.

But, keep in mind, it will take more than the clothing upgrade, that not always translates to new image, to move WM’s current business and low price image. Interestingly, the use of clothing, Branded and of better quality, doesn’t always succeed to a) change the perceived image of a business, and b) bring a new shopper that is higher in income and, more than likely, education.

The new 187 format can assist the quest of WM to gain and add a new shopper base. But the marketing effort needs to be heavily skewed to advertising in the many needed mediums (to include the internet) in order to communicate to the consumers what WM’s new store is providing, differently, than the others.

Right now, it is still a significant missing link. Hmmmmmm.

Karin Miller
Guest
Karin Miller
14 years 11 months ago
The Wall Street Journal reported Thursday that Wal-Mart is planning to trim selection in categories such as coffee makers and dog food to make way for more fashion items in the apparel and home areas. Smart. A personal observation: they would not have lost my recent laundry detergent sale if they had only offered half the selection! In executing a strategy to upgrade their fashion image, most important is for Wal-Mart to first ensure that the opening price point customer is not alienated. They must maintain unquestionable leadership in this segment of merchandise, keep it visible, and not ignore the need to keep these products updated. For new fashion merchandise, accurate identification of the broad fashion mega-trends and execution of them with similar quality to specialty retailers at noticeably lower prices would be a good place for continued emphasis. Rotating promotional, fun, impulse-driven non-replenishable fashion merchandise will upgrade the store’s coolness factor, and give the customers a reason to come back more frequently. This will also provide Wal-Mart a low-risk way to build an information… Read more »
wpDiscuz

Take Our Instant Poll

How important is apparel to Wal-Mart’s stated strategy for upgrading its image with consumers who only shop its stores for everyday staples?

View Results

Loading ... Loading ...