Big Exclusives in a Blah Market
By Jennifer Marks -- Home Textiles Today, 5/19/2008 12:00:00 AM
The current calendar year has no shortage of brand launches. Private labels, captive brands and iconic industry brands have already begun rolling out, with more on the way.
The Class of 2008 includes:
Wal-Mart: Canopy, Better Homes & Gardens;
JCPenney: American Living, Linden Street;
Bed Bath & Beyond: Royal Velvet;
Macy's: the second wave of The Martha Stewart Collection;
Unfortunately, they're all hitting the stores in an environment that is proving singularly poor for the home department. So when Macy's reports Martha Stewart is doing "OK" and JCPenney asserts American Living is being well-received, it's hard to know whether that means the labels are exceeding expectations, meeting plan – or simply doing better than other brands in a generally anemic category.
Even the bright spots don't seem to be lifting home out of the basement. At Kohl's, women who buy Simply Vera Vera Wang merchandise (launched last fall) are the most apt to cross-shop other departments and open credit accounts. Yet the home department remains at the bottom of the heap in terms of performance.
You can't fault retailers for attempting to inject new storylines into their assortments. They are to be applauded for it. These brand launches were planned well in advance of the housing debacle, and only two months ago many economics were still debating whether the country was in a recession or headed for a recession. Some are still arguing the point.
The larger question is whether the malaise will dampen retailers' appetite for planning big, in-house-generated launches for 2009. Looking back, the mild 2001/2002 recession jack-knifed what had been a frenzy of new prototype launches (Big K, Home Compass, ShopKo2000 and others). Today's underwhelming climate may have the same effect on brands.
Which doesn't mean the era of exclusives or private labels has ended. Rather, I think it likely that retailers will look more closely at brand opportunities served up by suppliers. Brand launches in '09 may become more discrete, more targeted within individual categories — more Dog Whisperer Cesar Millan pet beds than Big Name Multi-Category Home Statement.
There are already plenty of fresh Big Name Multi-Category Home Statements on shelves awaiting a better economy for the opportunity to prove their full worth. 2009 may well be the year that retailers fill in the nooks and crannies of their assortments with brands that are smaller – and whose risks and minimums fall on someone else's ledger.
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