Consumer Behavior - "Retail's New Odd Couple"Presentation Transcript
“Retail’s New Odd Couple” By: Ann Zimmerman& Dana Mattioli Source: Wall Street Journal Published: July 10, 2012 Group 1 Kelly Aranibar, YasminBagha, Emily Bartlett and Nick Cafferky
Summary of Article• An experiment that “pushes retailing’s boundaries.” • Includes a limited collection of 24 designers• Prices range from $7.99-499.99, average $60.00• Products• Label includes both Target and Neiman Marcus logos.• Reasoning for partnership• Gamble for Neiman Marcus
ProsTarget Neiman Marcus• Partnerships are met • Products are more accessible with continued success. to a broader range of customers. • Missoni • Specifically younger • Jason Wu customers • Zac Posen • New target markets• Competition • More consumer exposure for • H&M and Kohl’s designers.• Profit • Tone down “snobbish practices.”• Exclusive products keep shoppers in stores.
ConsTarget Neiman Marcus• Confusion among • Erode luxury chain’s customer base. exclusive appeal.• Lack of consistency • Goods must be • Pricing produced in bulk. • Reduces quality• Lack of awareness • Reduces demand • Advertising for products.
Consumer Perspective• Cognitive Dissonance• Social judgment theory• McGuire’s psychological motives • The need to categorize• Reference Price
Critique• Majority of Target customers will think the Neiman Marcus products are too expensive.• Neiman Marcus could lose credibility among its loyal customers.• “Hush-hush” approach• Commercial• Ultimately, this experiment will erode the exclusivity of the luxury retailer.
Discussion1) What do you think about this experiment?2) Which company do you think works to benefit most from this experiment, and why?3) What do you think about the advertising in terms of the commercial we showed earlier?4) Do you think this could lead to the future mergers of high- and low-end retailers?