Good Idea, Bad Execution

Much has been written about Wal-mart's recent "failure" to offer "upscale" apparel under the Metro7 brand name. The focus of the discussions have revolved around them straying too far from their core of value and low prices. That their customer base wouldn't respond to upscale merchandise and that high-income people wouldn't come into Wal-mart to buy clothes. And, indications point to the fact that customers didn't respond to their efforts.

First, even a company like Wal-mart has to find ways to grow their business, find new areas of revenue creation and offer new products. They can't squeeze their suppliers to growth for the rest of their lives, they need to innovate. With that said, who can blame them for taking a chance. I think it is a good idea. But, with poor execution.

Wal-mart developed some new apparel lines that for all intent and purposes,aren't too bad. The designs are trend right and not too far away from center. And, relatively  speaking not expensive. So why didn't it work out? And, why is the retailer retreating from the strategy?

I believe that like Sears with Lands End, Wal-mart thought they could squeeze in the new line between the same ol' merchandise and same ol' shopping experience and that people would come flocking. It just doesn't work that way. Specialty retailers like A&F, American Eagle, Hollister and others are offering great experiences and cool merchandise. Wal-mart might have had a chance if they invested in creating an experience within their store. A destination that had four walls around it to house this merchandise with different sales associates, different lighting and music. I'm not talking huge square footage, but something distinctive enough to merchandise the products in a cooler way.

The same goes for Sears with Lands End. What's another $100M in build-out expenses when you've just paid $1.2B for the brand? Don't be pennywise and pound foolish, finish the experience for people - they will reward you for it.