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“Strange Bedfellows” and “Opposites Attract” blared the headlines when Target and Neiman Marcus in July unveiled a joint collection of designer holiday gifts. The new odd couple said they were simply two retailers with an appreciation for great design, developing inspired products and exploiting each other’s strengths.
In Target’s case, it’s exposure and production know-how. With 1,781 U.S. stores, Target can put the collection in front of 2.5 million pairs of eyes daily. It also knows how to manufacture without paying an arm sleeve and pant leg. Neiman’s, for its part, brings cachet to the table. The retailer operates 42 stores in affluent locales and has the clout to work with most designers, who consider it fashion retail’s holy grail.
Target + Neiman Marcus is an unprecedented effort. Not only did a mass merchant and luxury specialty store hook up, but the number of designers and products was daunting — 24 Council of Fashion Designers of America designers created at least 50 gifts.
“We have never been involved with anything like this with another retailer,” said Kathee Tesija, Target’s executive vice president of merchandising. “Certainly, Neiman Marcus has great relationships with all of these designers. Twenty-four at one time might have been a little tricky for us.”
“Target really has the supply chain to help get these products designed and manufactured at the quality level we both want,” said Karen Katz, president and chief executive officer of Neiman Marcus. “We don’t do very much direct sourcing. That is not necessarily a strength of ours. We could give lots of introductions to all the designers, but from a supply chain perspective, [Target] is extremely well-equipped.”
Target has a long history of working with designers, first through its Go International program and more recently with The Shops at Target. The mass retailer has also partnered with luxury retailers in the past. Target in 2008 introduced its first line of eco-friendly apparel designed by Rogan Gregory, putting it on sale first at Barneys New York.
Both Target and Neiman’s revved up the hype machine. No expense was spared for the ad campaign, with Craig McDean photographing print ads and directing TV commercials. Karlie Kloss was featured, prancing in black vinyl leggings among the gifts and popping out of a white box, gift-like, with a huge bow on top of her head. “The Target + Neiman Marcus collaboration needed an execution that was at the highest level of fashion,” said Robin Derrick, executive creative director at Spring Studios.
The program has garnered a few sour reviews, however. In a Dec. 6 research note, Deutsche Bank analyst Charles Grom concluded that “the collection is indeed off to a much worse-than-expected start” and selling better at Neiman’s than at Target. In response, a spokesman for the mass retailer said, “This collection was never intended to be a one-day shopping event. A lot of the media have been benchmarking this program to [the popular September 2011] Missoni partnership, and it’s not. We more than doubled the inventory for Target + Neiman Marcus and put product limitations in place” so consumers would be able to shop the collection through the holiday season.
The Target spokesman said anywhere from a handful to 150 people lined up at most stores on Dec. 1, the day the line launched, and traffic online was similar to Black Friday. “This is the first time we pulled a collection into one area, like a shop within a shop,” he said. “We heard from some guests that it wasn’t as easy to find, so we worked quickly to relocate the shop and make it more visible.”