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Target signals emerging retail trend: new lines only available online

Retailers of all sizes are seeking to find the delicate balance between online competition and offline competition without one threatening the other – could Target be on the precipice of finding the right formula for the retail industry?

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target online

Target forges new partnerships, but only for online shoppers

In recent years, Target has experimented with brand partnerships, like Missoni whose fashion items were so popular, the retailer had to place limits on how many each shopper could buy since they were ending up on eBay for two or three times their original price. But not all partnerships have succeeded, like the massive marketing push and shelf space devoted to the partnership with Neiman Marcus, which Target assumed would be another Missoni, only to end up with overfilled shelves at the end of the season with a large amount of inventory they ended up selling at 70 percent off.

With mixed success with brand collaborations, the retailer is experimenting once again, but perhaps in a more safe-guarded way: online. The company has announced the debut of six new brands that will be sold exclusively through their website, including bedding (Room365 and Boho Boutique), women’s apparel (Labworks), baby clothing (Zutano Blue), and home décor (TOO by Blu Dot and MudHut).

The new products are affordable and in line with Target’s existing offering, so the partnerships are more of an enhancement of the company’s existing brands rather than an experiment, even Blu Dot which tends to be above Target’s average price point, but the company will be offering an affordable line exclusively through the Target website.

In a statement, Target divisional merchandise manager Theresa Schmidt said that the retailer was “excited about these new brands,” especially because they will help differentiate Target’s site from other e-retailers. “We know our guests are increasingly connected and are shopping online more, so we wanted to offer guests something new, unique and unexpected.”

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Why online? Because Target has come to compete

Earlier this year, Target announced that they would price match Amazon, Walmart, and Best Buy website prices but would extend the price matching offer for all of 2013, whereas competitors ended online price matching earlier this month.

Seeking to maintain a healthy market share, the company is not blind to the fact that shoppers are spending more time and money online, and while many other companies offer “exclusive” brands that only they sell, Target is signaling an emerging retail trend of actually pushing consumers to exclusive options only available online – if they’re there anyway, the idea is to serve them no matter where they want to use their credit card.

If the lines do well, the retailer could consider adding select lines to their physical stores, and if they flop like the Neiman Marcus endeavor, they simply end the line and pull the plug with little cost.

What this signals for all business

There is a delicate balancing act for retailers of all size right now from the big box to the one-person-shop, and finding the perfect balance between online sales and offline sales in light of stiff competition is difficult, and right now is very much in flux. Big box retailers can afford to experiment as they find a norm, but smaller businesses may not be able to risk it.

In the coming years, it makes sense for more retailers of all size to test products online first before dedicating shelf space to them, and brand collaborations also make sense, so Target’s big moves these last few months truly signals that the retail industry is desperately seeking to find the right balance between online and offline.

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Written By

Marti Trewe reports on business and technology news, chasing his passion for helping entrepreneurs and small businesses to stay well informed in the fast paced 140-character world. Marti rarely sleeps and thrives on reader news tips, especially about startups and big moves in leadership.


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