BOSTON —, positioning itself to grab a slice of the $8 billion online apparel market, fired up its home page Tuesday morning with a shot of a fall George argyle sweater and placed an ad proclaiming “It’s Here! Apparel at” on Yahoo’s home page.

The world’s biggest retailer failed to profitably fulfill and ship apparel when it first began testing the category online in the late Nineties, leading to its decision to exit in April 2001. But Wal-Mart now sees huge potential. Its stores serve 138 million customers a week, and the company estimates two-thirds of them are online with a broadband connection.

“Apparel has been a top search ever since we exited the category,” said Jennifer Gosselin, senior director of merchandising for, based in Brisbane, Calif. “As well, online apparel sales have been growing quite rapidly, outpacing e-commerce growth in general.”

Gosselin called the current assortment of several hundred styles — spanning the retailer’s top women’s, men’s, girl’s and boy’s brands — “phase one” and said it will grow throughout fall. Maternity will be added within two weeks.

“By holiday, we will have an ‘above and beyond’ assortment, which will include items not offered in the stores,” she said. The “above and beyond” concept might translate to items such as cashmere sweaters.

“One of our roles at is prospecting for the rest of the company to see what could sell in the stores,” Gosselin said. “We get a read across broad geographic areas without having to take up space in the stores.”’s move into apparel means yet another arena in which to compete head-to-head with Target. Tuesday, while Wal-Mart had its Yahoo ad, Target had its cherry-red bull’s-eye planted on’s home page.

Mass market jeans label Levi Strauss Signature is one brand that may be caught in the crossfire. sells only men’s Signature, while offers just the brand’s women’s, junior and girl’s products. A Levi Strauss spokeswoman said the situation wasn’t prearranged but was “the way the buys worked out at this particular time.”

This story first appeared in the July 21, 2004 issue of WWD. Subscribe Today., the San Francisco denim company’s informational Web site, links consumers to both discounters’ Web sites for purchases.

“Signature has brought a new consumer into [Wal-Mart] stores, and we’re hoping that will translate online,” the spokeswoman said of the company’s placement on has a buying team, its own e-commerce warehouses and a simplified shipping policy that encourages multiple purchases: Shipping for the first garment is $4.97; each additional item is 48 cents. Wal-Mart corporate is backing the launch with a marketing campaign that includes Web ads, 30-second spots on Wal-Mart’s in-store television network and placement in the August monthly circular.

In terms of merchandise, has already scored a coup. Danskin Now, a new “ath-leisure” brand, launched Tuesday morning exclusively on, said Danskin chief executive officer Carol Hochman. The brand will be available in all Wal-Mart stores at the end of August. The New York-based dancewear company already has two flourishing lines at Target: Freestyle and ProSpirit. used brand-search data to select 16 national and private label lines to relaunch apparel. George, White Stag and Faded Glory are online along with Levi Strauss Signature, VF Corp.’s Wrangler and Riders, and the Mary-Kate and Ashley brand.

“The timing could be very good for Wal-Mart,” said Gary Drenik, partner with Columbus, Ohio-based The company’s July survey of 9,000-plus shoppers revealed that Wal-Mart shoppers had slightly higher consumer confidence levels and that they planned to spend online more aggressively in the next 90 days than the general shopping populace. About 66 percent of Wal-Mart shoppers who planned to spend more online estimated they would spend $100 to $400 on back-to-school clothing and accessories, said Drenik.

Mandy Putnam, vice president of Columbus-based research firm Retail Forward, called’s entry into apparel “a large splash in a small pond” because, he said, e-tail sales represent only a fraction of overall apparel purchases.