Picture yourself walking through the apparel section at Wal-Mart. You pass by the usual oversized sweaters, novelty T-shirts and a sensible pair of burgundy stirrup pants. Then, it catches your eye: a gigantic red, white and blue Tommy Hilfiger display.
"What is this doing here?" you ask in disbelief. "I'm a redneck woman, and I ain't no high class broad."
At least that was the first thought that went through my mind last week when a rumor surfaced in major newspapers around the country; Wal-Mart might purchase the Tommy Hilfiger label for around $2 billion.
The possible Hilfiger purchase is just one part of Wal-Mart's aggressive campaign to reinvent its image in the fashion design and clothing manufacturing domains. In the September issue of Vogue - hailed by many as "the fashion bible" - Wal-Mart purchased an eight-page spread, running ads alongside Gucci, Oscar de la Renta and Roberto Cavalli. And the company held its first fashion show during New York Fashion Week last month.
Wal-Mart has also expanded the offerings of a private label, George, which has done extremely well overseas and features dressy clothes for the whole family. USA Today reports that George is the No. 1 clothing brand in Britain, in terms of market share. However, the brand has largely failed to catch on in the United States so far.
At first glance, being carried at Wal-Mart seems like a considerable step down for Hilfiger, a line that has been sold exclusively at high-end department stores, Hilfiger outlets and Tommy.com. However, fashion experts recognize that the Hilfiger brand doesn't have the same luster it did during its peak in the mid- to late-1990s, in part due to overextension of product lines.
BusinessWeek notes that Hilfiger reported an income of $92 million in fiscal year 2005, down sizably from the $170 million reported in 2004.
Some of Hilfiger's exclusive retailers have expressed concern that sales and levels of prestige will drop if the same merchandise is carried at Wal-Mart or a similar, low-end chain. One possible compromise is that designer Tommy Hilfiger could reserve his traditional line of merchandise for the higher-end retailers and design a unique line for Wal-Mart stores. The only noticeable difference between the two lines would be that the trademark Hilfiger logo would be replaced with a big yellow smiley face.
In addition to prices, Wal-Mart customers should now watch for falling status.
In the best scenario, Wal-Mart will transform itself as Target has. Target's fashion sales have far outpaced those of Wal-Mart in recent years, especially since the addition of fashions by Mossimo Giannulli and Isaac Mizrahi. Shortly after the acquisitions, Target executives officially changed the store's pronunciation to "Tar-zhey."
Robert Passikoff, president of brand research firm Brand Keys, said, "I liken what Wal-Mart's trying to do in terms of fashion to turning around the Queen Mary at full steam."
Sherif Mityas, vice president and managing partner for consulting firm A.T. Kearney, is also skeptical: "Do what you do well. This is outside of what people know you for," he cautioned Wal-Mart. He also noted that adding a higher-priced fashion line could clash with the company's current image, potentially confusing and alienating customers.
As poor college students without much expendable income, we always value Wal-Mart's everyday low prices. Always. As a result, we should be worried about Wal-Mart's impending face-lift - nicer brands cost more, both to buy and to successfully carry.
Hardcore Wal-Mart regulars do not need brand name clothing. However, we do need toothbrushes, cooking utensils and two-liters of pop for 88 cents or less. If we notice prices rising as fashionable brands slowly take over the shelves, we'll be on the first MITS bus to LoBill Foods and the Dollar Tree.
But until then, y'all, I'll see you in aisle 12.
Write to Brian at
bggorrell@bsu.edu
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