Target Corp. to its vendor partners: Better pricing strategy is needed.
A research note by Deborah Weinswig, retail analyst at Citigroup, said Target recently sent a letter to its vendors indicating that to compete effectively with Amazon and Wal-Mart, it was changing its pricing strategy and is challenging its vendors to “work with [Target] to develop an assortment and pricing strategy that will allow Target to be competitive and profitable across all channels.”
The letter was sent to Target’s “most important vendor partners” and was signed by chairman, president and chief executive officer Gregg Steinhafel and executive vice president for merchandising Kathee Tesija, according to Weinswig.
A copy of the letter could not be obtained, but certain highlights were noted in the research note. According to Weinswig, Target emphasized the need for “brick-and-mortar retailers to partner with their vendors to ensure that their stores are not used as ‘showrooms’ for online-only retailers.”
In one of the excerpts, Target said it isn’t willing to let online-only retailers use its stores as a showroom and then “undercut our prices without making investments, as we do, to proudly display your brands.”
In another excerpt, Target’s letter said that on possible vendor collaboration ideas, the specifics of the programs could include differentiated guest-focused assortments from online-only retailers that still include best sellers, pricing the same as online-only retailers and “developing membership- or subscription-based pricing online to compete with online pricing models in the markets.”
In her analysis, Weinswig concluded that the industry should expect more brick-and-mortar retailers to rethink their pricing strategies this year, as well as increasingly demand support from vendors to better compete with lower-priced online retailers.
She explained that the membership- or subscription-based model Target refers to includes programs such as Amazon’s Subscribe and Save, which offers discounts on regular shipments of merchandise.
The analyst also noted that price transparency has shifted due to the Internet and mobile commerce. In addition to Target’s letter, she noted that J.C. Penney Co. Inc. is also shifting its pricing strategy,implementing an “Everyday Fair Value” model compared with the promotional pricing associated generally with department stores.
@kering_official is spinning off its stake in puma in an effort to focus on its luxury brands, the brand operator announced yesterday. “We are proud to have supported the turnaround of Puma, which now has unrivaled capabilities to take full advantage of the specific dynamics of its global markets and is poised to achieve substantial growth,” said François-Henri Pinault, Kering’s chief executive officer and chairman. Artémis will become a “long-term strategic shareholder” of Puma with a 29 percent stake. #wwdnews #wwdfashion (📷: @jilliansollazzo)
The fashion world mourns for celebrated street style photographer, Nabile Quenum, who died at age 32 in Paris.
Quenum, creator of the fashion blog “J’ai Perdu Ma Veste,” was a fashion week fixture, and regularly shot for New York magazine’s The Cut, among other outlets, and brands such as Louis Vuitton, Moncler and Adidas. He was also actively involved in the #NoFreePhotos initiative, which kicked off in the fall. Read more about Quenum in @kbsmoke's story on WWD.com. #wwdnews
@verwanggang and @maisonladuree have teamed up on a dessert collab called Vera Wang Pour Ladurée. The collection, which launched this week, features a specialty macaroon, as well as a wedding cake inspired by one of the designer’s gowns. “I could not imagine a more delicate or sophisticated creation to grace any couple’s celebration,” said Wang. #wwdfashion
“I’m Russian and I love to use all these little tricks that I got from my grandma or my mom. We didn’t have a lot of money for creams or anything like that so we would use a garden as a beauty treatment regime. We’d put cucumber in the fridge and do a cucumber mask,” says model @irinashayk on one of her beauty hacks. WWD asked celebs what their go-to self-care rituals are. See what Naomie Harris, Freida Pinto and more said on WWD.com. #wwdeye #wwdbeauty (📷: @zefashioninsider)
Exclusive: @viktorandrolf are teaming up with @Zalando on a collection made from leftover clothing. The lineup, which lands at the retailer February 1, includes 17 pieces adorned with sliced up and repurposed overstock from the retailer’s private label collection. Pictured here is a look from the collection –– see more on WWD.com. #wwdfashion #wwdnews
@duewestnyc is the newest bar joining the collection of intimate neighborhood-focused spaces in the West Village. The cocktail menu, which includes bitters and syrups made in-house, offers a “Build Your Own Old-Fashioned” – like the one pictured here – where guests can choose from a list of spirits and unexpected sugars and bitters. #wwdeye
Spotted at last night’s National Board of Review gala in NYC: Angelina Jolie. Jolie – along with Meryl Streep, @lupitanyongo and more – continued the all-black dress code from Sunday’s Golden Globes. #wwdeye (📷: @lexieblacklock)