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'7' cheap-chic tips from Wal-Mart
New fashion line not runway-worthy but could be a step up for the world's No. 1 retailer.
October 31, 2005: 4:06 PM EST
By Parija Bhatnagar, CNN/Money staff writer
Wal-Mart picked former Miss Universe Dayanara Torres as the face of its new fashion-forward clothing brand Metro 7.
The retailer will showcase Metro 7 in an upcoming issue of fashion bible
The retailer will showcase Metro 7 in an upcoming issue of fashion bible "Vogue."

NEW YORK (CNN/Money) - Is Wal-Mart really going after rival Target by launching a new, hipper women's clothing line called "Metro 7?"

The folks at Wal-Mart (Research), of course, dismissed the notion that "Metro 7" was a conscious attempt by the world's largest retailer to play "catch-up" with its more sartorially savvy rival.

"We don't like to think of it that way," Tyra Chappell with Wal-Mart's clothing division told CNN/Money after the company introduced its new "Metro 7" line to reporters in New York on Thursday.

"Target is trying to primarily appeal to trendy shoppers. If you're not that, then you feel a little bit of pressure," she explained, noting Wal-Mart's strategy was to cater to "all types" of customers.

"At the same time, we recognized there was a void in one market," Chappell said. "With Metro 7, we're addressing the needs of the young and fashion-conscious woman with clothes that she can wear seven days a week both to work and to go out."

Two things are immediately noticeable in the collection, which includes a mix-and-match pieces like velvet jackets, skirts and long tunic tops -- the clothes are stylishly cut and feature a fair bit of embellishment, such as beads and sequins.

Wal-Mart spokeswoman Gail Lavielle said the retailer had been developing the concept for the past 18 months, seeking design input from its New York-based "trend" office.

"We're hoping to help a segment that's already shopping at our stores but wasn't necessarily finding what was essential to them," Lavielle said.

According to Lavielle, Wal-Mart isn't straying from its value-priced philosophy with the new brand. Prices are expected to range from $9.99 to $29.99, Lavielle said.

But Wal-Mart's new line is already drawing mixed reactions from industry observers.

Marshal Cohen, chief retail analyst with market research firm NPD Group, says Metro 7 is "one step further than where Wal-Mart has been with its apparel offerings."

"Some items are similar to what consumers are seeing at the specialty apparel stores," said Cohen. "Will Wal-Mart score a home run? Not yet. Wal-Mart still has a long way to go with merchandising and the need to romance the shopper with its products."

Candace Corlett, partner with consulting firm WSL Strategic Retail, agreed.

"Right now, Wal-Mart shoppers bypass the clothing. The displays are not attractive, the clothing doesn't jump out at you," she said. "Wal-Mart has not shown us that they understand the power of emotional advertising in the store."

Said Corlett, "Unless Wal-Mart takes fashion and puts it on a pedestal which shouts 'Come and look at me!', this endeavor will take a lot of energy without the payoff."

Few would argue that Target (Research) has successfully become a destination shopping place for value-priced but fashionable clothing and home furnishings featuring such hit lines as the Isaac Mizrahi apparel for women. Cohen said Wal-Mart still has a long way to go.

"Seven won't change the emotional mind set of the Wal-Mart shopper," Cohen said. "It won't drag people from elsewhere to shop for clothing at Wal-Mart."

Why so hush, hush?

While Target's become more gimmicky with its marketing efforts -- propelling models down the sides of building in an aerial fashion show, for example -- Wal-Mart's introduction of Metro 7 will begin with an insert in the upcoming issue of the fashion magazine Vogue.

"We're still working on other ideas," Lavielle said.

Cohen said a big splash would've had more of an impact. Said Corlett, "A launch for any fashion label has to be at a high decibel."

But one industry analyst had another perspective.

Howard Davidowitz said Metro 7 isn't about trying to catch up to Target in terms of merchandise or marketing.

"Wal-Mart has been losing same-store sales momentum due to store cannibalization and it's stock has been dead money for over five years compared to Target," said Davidowitz, president of Davidowitz and Associates, a retail consultant and investment banking firm.

What can Wal-Mart do? It can improve sales, even marginally, in three of its weakest areas -- apparel, home furnishings and consumer electronics, he said.

"I think its a brilliant strategy. Make small improvements that will boost sales even 4 to 5 percent over the next few years and that could lead to a dramatic turnaround for the company," Davidowitz said.

"Wal-Mart isn't about to become a fashion powerhouse. How can you sell fashion with nine aisles of dog food, detergent and chicken?"

"For a company with over $300 billion in sales, it just needs to change little things to get significant payoffs," he said.

Davidowitz has in the past worked with Karen Stuckey, Wal-Mart's senior vice president of product development. He credits Stuckey for some "smart" merchandising moves that include Metro 7.

"Stuckey's strategy would be to take a plain low-priced product like jeans and embellish it with design. Suddenly it becomes a 'fashion' jeans and appeals to a new ethnic audience. It's the same strategy with 7," Davidowitz said.

To that end, he's not surprised that Wal-Mart picked Dayanara Torres, a former Miss Universe and former wife of singer Marc Anthony, as the face of the new brand.

"Is Wal-Mart going after the Hispanic and African-American consumers? Absolutely. They're a significant percentage of Wal-Mart shoppers," Davidowitz said.


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