Cheap chic discounter Target (TGT) and upscale department store Neiman Marcus are teaming up on a holiday fashion, home and accessories collection that will be sold at both chains -- marking an unprecedented partnership between two retailers.
Strange bedfellows? Not really. The two have more in common than meets the eye.
Target has sold some of the same luxury brands as Neiman Marcus, Kevin Ryan, CEO of Gilt Groupe, the nation's biggest private-sale website, tells Daily Finance.
While you'll never find Neiman Marcus' $995 Jean Paul Gaultier dress in Target's stores, a $59 frock from Gaultier has indeed dangled from the discounter's racks. And it's no secret that Target enjoys an upscale cachet unlike any other mass merchant.
Since the late 1990s, Target has brought high fashion and hip design to the masses with exclusive collections from tony designers and upscale names, like Gaultier and Missoni, offerings once unheard of for a discount chain.
Today, the demographic of Target loyalists includes the more affluent consumers who also shop Neiman Marcus. And when the co-branded collection debuts Dec. 1, Neiman Marcus, with only 42 stores, will gain a new level of exposure in Target's 1,763 stores, Gilt Groupe's Ryan says. "It gives them scale."
What's more, "It's a big win for Neiman Marcus, which definitely needs to become more relevant to younger, more contemporary customers," Mark Cohen, professor of marketing in the retailing studies department of Columbia University's business school, and former CEO of Bradlees and Sears Canada, tells DailyFinance.
The Target-Neiman partnership will also derail competitors' merchandising efforts, Cohen predicts. "The Big losers -- there are always winners and losers in retail --are J.C. Penney, whose 'shop' idea becomes even more irrelevant than it already is, and Macy's, whose own designer collaborative program suffers by comparison," he says.
A Match Made in Heaven?
The limited-edition holiday gift line will include women and men's apparel from 24 designers, including Diane von Furstenberg, Oscar de la Renta, Marc Jacobs, Jason Wu, Tory Burch and Tracy Reese.
It will also feature children's apparel, home decor, sporting goods and electronics accessories.
Dubbed, The Target + Neiman Collection, prices for items in the line will range from $7.99 to $499.99, with most under $60.
Judging from reaction to the news on Facebook, shoppers at both Neiman Marcus and Target are already giddy about the pairing.
"My two favorite stores! High end [and] low end can move towards the higher end!" said another shopper.
Target shoppers were equally enthusiastic. "Oh my GOSH! Cannot wait! PLEASE ensure your website is ready!!!," said one shopper, a not-so-veiled reference to the way Target's website crashed the day the retailer premiered its exclusive Missoni collection last fall, after it failed to anticipate the extraordinary demand the launch would generate.
But not all shoppers were enthused.
Some Neiman Marcus purists said the partnership sounded the death knell for the department store's tony image, and predicted the co-branded line would be of discount-store quality.
"By no means would I expect any of the pieces to end up being heirloom quality that can cherished and passed down as valuable pieces," said one Neiman's fan.
"Neiman Marcus, that is disappointing, and a total downgrade to team up with Target," said another.
One shopper smirked: "Neiman's adds hot dog and popcorn stand at the front of stores? Red shopping carts ... now coming to a store near you?"
The luxury retailer found it necessary to allay its its customers' concerns, interjecting its own response among the thousands of comments:
"Hi everybody! Thanks for all the enthusiasm! And for those of you who are worried about our 'image,' we appreciate your concern as well," the company said. "Here's the thing. If our image is not innovative, welcoming of all, and open-minded about good design, we're OK with changing that. So thanks again. Remember December 1, and we'll keep you posted!"