How Target and eBay are Making Their Buyers' Jobs Easier
It was the best of times, it was the worst of times. My apologies to Charles Dickens, but this opener from Tale of Two Cities could be applied to the current retail landscape (think lots of optimism from stores but shoppers are still cautious). And the two cities in question are eBay (EBAY) and Target (TGT) as each tries to further hone their fashion strategies for next year.
The Sure Thing
Target's Go International capsule collections have become legendary among fashionistas (and shoppers who happen to push their cart past irresistible looks from iconic designers on their way to the kitty litter) practically since their launch five years ago.
Since then, the Minneapolis-based retailer has elevated its hype-to-rack strategy to high art and has been imitated (not always successfully) by the likes of Walmart (great Norma Kamali line, not great distribution), Kohl's (Simply Vera Wang = great; Lauren Conrad = not so much) and other department stores. Target's numbers have reflected the strength of its apparel assortment. While comps hit rocky times during 2008-9, total sales dipped only twice during the same period. Women's apparel sales for September (just after the debut of Gaby Basora's Tucker line!) led that segment with a mid single-digit increase. Go International reportedly represents more than $100 million in sales according to WWD.
Now, rather than reinvent the wheel, Target's going down the road of so many music superstars and issuing a "greatest hits" collection. Can you say better margins? Indeed, the effort -- dubbed Designer Collective -- means Target already has the sourcing in place to trot out 34 dresses from 17 previously featured designers including Proenza Schouler, Erin Fetherston, Rodarte, Zac Posen and Tucker in plenty of time for the debut March 13, 2011. What's more, the buyers have hard sales data to help make stocking enough of each style less of a guess.
Following the Crowd
eBay's made some interesting moves in fashion lately. Some of which were undoubtedly smart (think Narciso Rodriguez' eight piece diffusion line), others left me wondering (LookBook contest).
There's no doubt eBay's throwing a lot of stuff against the wall to raise its fashion quotient. Mostly these initiatives are adapted from other successful ventures and given the eBay twist. For its latest turn on the runway, eBay's going for a mélange of tactics. It's rolling out another capsule collection, this time by well-respected (but not terribly well-known out of fashion circles) designer Derek Lam to debut at NY Fashion Week in the spring. The twist (similar to one used by e-commerce up-and-comer ModCloth) is that shoppers will be able to vote for their favorite pieces on eBay. The winning styles will go into production.
Hooray for the wisdom of crowds. Derek Lam doesn't have to agonize over which pieces to produce how many to manufacture and eBay's practically guaranteed buyer/seller transactions (although no word yet from the auction giant as to how big a cut it'll take on the sales). Still, borrowing ModCloth's Be the Buyer, eBay can capitalize on a cost-cutting measure that will do wonders for its bottom line.
Image of Tucker for Target via Target
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