With the launch of Gap Home on Walmart.com on Thursday (June 24), all eyes are on how Gap’s first foray and Walmart’s expansion further into home décor could shakeup an already competitive space.
The new brand, first announced last month, is likely the beginning of a long-term partnership between Walmart and Gap, as the former looks to drive more online sales and the latter looks to attract more shoppers. The line includes over 400 items across home décor, tabletop, bedding and bath.
What could be good news for Gap and Walmart, however, could spell trouble for established home furnishing companies, especially Bed Bath & Beyond, which is set to release its first-quarter earnings next week.
What Bed Bath & Beyond hopes it has going for it, though, is its creation of personal retail experiences and use of customer-oriented strategies. The company has recently been introducing a slate of new owned brands in a private-label push, as have Kohl’s and Target.
Bed Bath and Beyond President and CEO Mark Tritton said at a National Retail Federation event on Wednesday that the company has spent significant time strategically creating “an ecosystem of brands and businesses that we can use in terms of data and operations to create synergy, create growth and really fuel the customer experience.”
The New Jersey-based domestic merchandise retailer has also divested from several businesses in the past year, including Cost Plus World Market, in order to focus on Tritton’s going of being “a dominant force in … those key life moments.”
Partner Power
Gap has seen success through its partnership with Kanye West and his Yeezy brand, with a $200 “Round Jacket” selling out in less than an hour earlier this month. Though Walmart and home décor customers are not likely to be as frenzied as Kanye West fans — none of the Gap Home items appeared to be sold out as of Thursday morning — Walmart gives Gap a more predictable revenue stream.
“Through partnerships, we can extend the reach of our brands to customers across product categories, markets and channels,” Gap CFO Katrina O’Connell told investors last month.
Walmart, too, is reaping the benefits of third-party partnerships. In the past month, the box-store giant has announced partnerships with AT&T to bring high-speed internet service to low-income households and ShipBob to help bring two-day shipping to Walmart’s independent marketplace sellers — in addition to the partnership with Gap.
New Turf For Both Brands
The combination of Gap’s styling prowess and Walmart’s retail muscle is not only a formidable combination of two mature brands, it also marks a major a major step forward in the digital transformations that both companies are undergoing as the look to increase their exposure to eCommerce.
To that point, the Gap Home launch has included an array of contemporary digital selling initiatives including a social media livestream preview hosted by celebrity and designer influencers, a glossy digital lookbook displaying the merchandise and a co-branded designated landing page as well as presence on Walmart’s Facebook page.
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