For years, Walmart has been a place to shop for lower- cost principles. The retail giant is now officially entering the fashion industry, competing with Amazon once more and aiming to increase its $7.2 trillion financial pie.
The course of action has been continuous. Denise Incandela, a veteran of Saks Fifth Avenue, was hired by the company in 2017 ( she is executive vice president of Walmart U.S.’s apparel division ), and Brandon Maxwell, the designer, in 2021. And this month, Doug McMillon, the company’s president and CEO, declared to researchers that it is ready to take the lead in terms of style.
“We punched below our mass on public goods, specifically in clothing and house for a really long time, even forever,” McMillon said. “We now have tools that we can use to expand the general merchandise business that we didn’t have before.”
Maxwell, who is artistic director of Walmart’s Scoop and Free Assembly businesses, is helping drive Walmart’s attitude change when it comes to style, bringing in his own great fashion experience at his company, as a “Project Runway: prosecutor and as a designer, somewhat for Lady Gaga.”
“There’s this concept that style is southern. Fashion is anywhere,” Maxwell said.
“People everyday accept style,” Maxwell said. “They love it, they want to experience great. It shouldn’t surprise me that our clients are enthusiastic about the product, how they style it, and how they incorporate it into their lives.”
At Free Assembly, Maxwell pours out raised elements, from shirts to clothes and jumpsuits. At Scoop, a one- day “It “girl clothing shop that Walmart has transformed into a company, he gets to expand out more.
“Scoop is really for a very fashion- forward customer,” Maxwell said. “At Scoop, we frequently discuss designing the ultimate closet. We have those very common pieces that are in style, but we also try to give our customers something that is very contemporary and up-to-date each season.
” The possibilities are endless”, Maxwell said. What I notice about the Scoop customer is that she is willing to take chances. She’s excited about fashion, and she’s very aware of what’s going on, and she has a very solid sense of herself. And it’s been really fun to try some things, watch them on the customers, and watch them react.
Walmart is now willing to take a chance on fashion, too.
Incorporating Maxwell’s efforts into broader apparel changes has Incandela made since she joined the company. She has switched from selling basic clothing to fashion and oversees six brands that total over $1 billion. Under her direction, the retailer added Reebok and Chaps, Sofia Jeans by Sofia Vergara, and Love & Sports by Michelle Smith and Stacey Griffith, as well as more than 1, 000 national brands.
The retailer, which found in a consumer survey a few years ago that 80% of its customers’ closets were filed with looks out of its price range, has more than enough room for this kind of evolution.
Because we weren’t offering those price points, Incandela claimed, “They were getting their fashion elsewhere.”
“Walmart should be democratizing fashion,” she said. “We have the scale, we have the strategic supplier relationships, and now we have the designers and our own design team that we built in New York, which is all new for us, building out these brands. So instead of building labels, we’re working to build brands.”
Walmart U. S. logged fashion sales of $29.5 billion last year, according to an estimate from Coresight Research that includes third- party sales, but excludes Sam’s Club.
The retailer’s goal a decade ago was to get its high-speed basics business running smoothly and profit from the sale of fashion staples, which at the time included items like polo shirts with stripes.
The mass giant was good at what it did, but now it’s upping its game thanks in part to its large, digital transformation.
Under McMillon, Walmart has leaned into a whole new kind of business, embracing digital and carrying more than 420 million stock keeping units online. At last count, about a year ago, 200 million of those skus were in fashion, with the marketplace bringing in more higher- end third party brands.
The company, which has 4, 600 Walmart stores in the U. S. alone, spent decades being the biggest everything in retail only to find itself behind Amazon.
Now, Walmart is the second largest player in fashion, according to Coresight, which clocked Amazon at $56.4 billion last year— almost double Walmart’s take.
To get that big, Amazon took business from just about everybody, from Walmart to the mall. Brands like Victoria’s Secret and Coach have now established themselves on Amazon, acknowledging that their customers are there and that they are simply not big enough to compete head-to-head.
However, Walmart is large enough to compete with Amazon. And in fashion, it can still catch back up, if it keeps the right attitude.