When Brian Cornell replaced Gregg Steinhafel as Target CEO in 2014, he took over a brand that had lost some of its magic. The retailer had just suffered a massive credit card data breach at a time before those had become so common that consumers just shrug them off.
Target (TGT) -) had also become a little bit tired. It was missing some of the "TarJay" feel that made it stand out from rivals like Walmart (WMT) -). Cornell took aggressive steps to revive the brand by bringing in multiple store-within-a-store partners and totally revamping the chain's merchandise.
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The store-within-a-store concept helped turn Target into a destination. Building on its Starbucks (SBUX) -) relationship, the company added deals with Apple (AAPL) -), Walt Disney (DIS) -), and Ulta Beauty (ULTA) -). It also added a number of owned-and-operated brands as well as bringing in select big names to enhance its merchandise lineups.
Those big names included brands like Levi Jeans and Chip and Joanna Gaines creating a selection of Magnolia merchandise just for Target. It has been a recipe that makes the chain a destination.
In many ways, Target has become the new mall. People visit whether they need something or not, maybe grab a coffee or snack at Starbucks, then browsing the store.
Target has created a model that works and rival big-box retailers have noticed. Both Macy's and Lowe's (LOW) -) are borrowing aspects of the Target model to enhance their own stores.
Image source: John Smith/VIEWpress.
Macy's partners with J-Lo
Target with Ulta Beauty, and Kohl's with Sephora, have shown that beauty products can be a major draw. Now, Macy's (M) -) is trying to get in on some of that action by partnering with Jennifer Lopez's JLo Beauty brand.
The chain launched an assortment of skincare, beauty, and bodycare products, "inspiring all women to be their everyday superstar," according to a press release.
Following a similar model to what Target and Kohl's are offering with Ulta and Sephora, the JLo line is meant to be affordable.
"JLo Beauty products feature luxurious, high-performing formulas with immediately visible and long-lasting results with prices ranging from $15 to $105. The full assortment including fan favorites like That JLo Glow Serum, Firm + Flaunt Targeted Booty Balm, and more are available to shop on macys.com, Macy’s mobile app, and at select Macy’s stores nationwide," the chain shared.
Adding JLo's products helps Macy's meet a need in its stores.
"Over the past few years, Macy’s iconic beauty business has been dominated by fragrance, cosmetics, and skincare. By listening to market trends, Macy’s continues to expand their assortment in direct response to their customers’ needs," the company explained.
Lowe's partners with Carhartt
Lowe's sells a lot of merchandise to people who are about to go to work. That includes professionals and do-it-yourselfers working on home improvement projects. It has never sold work clothes, but that is changing as the chain has partnered with Carhartt, a privately-held company that uses the slogan "the uniform of hard work since 1889" for a new collection.
"The collection will feature Carhartt's iconic duck jackets and vests, as well as hoodies, T-shirts, workwear pants, and beanies. Currently, the collection is available at roughly 250 Lowe's stores across the Northeast, Midwest, and Pacific Northwest – with approximately 250 additional stores in Texas, the Southeast, and California adding Carhartt products in early 2024," the company shared.
Lowe's Merchandising Executive Vice President Bill Boltz shared why his chain has added the clothing line.
"Carhartt is a top brand that pros know and trust for apparel that's made to last," he said. "...Not only is Carhartt a workwear staple, but it is also a popular brand for daily living, building on our product assortment to create a one-stop shop for everything our customers need."
Lowe's shares are flat on the year in a stressed stock market. Macy's shares are down 46%. Target shares are down 12.6%. Macy's and Target shares have been struggling with weak consumer spending,
