Wal-Mart’s Apparel Project
By Tom Ryan
Described by Women’s Wear Daily as its "perennial Achilles
once more changed direction in its struggling apparel business.
"We are going back to basics in many ways," said Eduardo Castro-Wright,
who oversees Walmart’s U.S. business, at a press event
Friday following Wal-Mart’s annual meeting. "Basics as in business basics
but also basics literally in terms of the product itself. Socks and underwear
to jeans and T-shirts — that’s where we excel … We’re not a department store."
article in WWD recounted three recent incarnations of Wal-Mart’s
apparel strategies. First, it mimicked cheap-chic by launching Metro 7 and
George ME by Mark Eisen in 2005. Both collections were quickly discontinued.
Then, a hybrid approach called for low-cost basics accompanied by some exclusive
well-known national brands such as L.E.I., Starter, OP and Danskin. A lifestyle
collection by the designer Norma Kamali as well as a Miley Cyrus & Max
Azria juniors collection debuted last year.
In May, however, Mr. Castro-Wright
admitted that apparel was performing "below
expectations and continues to be a work in progress," apparently leading
to an even greater basics push.
"Management is convinced that apparel at mass merchants is not brand
driven, and that instead, Wal-Mart has been ‘chasing too much glitter,’" Bill
Dreher, an analyst at Deutsche Bank, told WWD.
stand out in light of its main rival Target’s success. Observers told WWD that
Wal-Mart has never embraced designer collaborations that have worked for Target,
which requires a big advertising push and high in-store visibility. Part of
the issue, they say, are concerns that high-end fashion alienates its core
shopper. One observer believes that they don’t
want any brand to "overshadow" the Wal-Mart brand.
A source close to Wal-Mart told WWD that
the key is more color, "They
sell a lot of goods to mainstream [shoppers]. Their customer is not the fashion
elite." The key to Wal-Mart’s apparel strategy, said the source, "is
to take basics and give them more color, not think about acquiring brands."
Suzanne Hader, principal at 400Twinconsulting, argued that Wal-Mart needs
to explain the benefits of shopping for apparel alongside groceries, and that
might only be possible through branded partnerships.
"Wal-Mart could do low-priced, totally affordable basics in a lot of colors
and shapes in a vast range of sizes," said Suzanne Hader, principal at
could occupy that space, but what story would they tell around that? Wal-Mart’s
story always defaults to price. With apparel, you need more."
Discussion Questions: Why do you think Wal-Mart has struggled in its apparel
business? How important is it for Wal-Mart to make fashion apparel work in
- Wal-Mart’s U.S. apparel a work in slow progress – Reuters
- Wal-Mart’s Uphill Battle With Apparel – Women’s Wear
- Wal-Mart Shuffles Apparel Executive Responsibility – Bloomberg