The brand, Gap Home, will launch on Walmart’s website on June 24 and potentially carry the most popular items in some of the big box stores. It will start with around 400 pieces of bedding, bath and decorative accessories. The price for the initial collection ranges from $ 15.88 for a denim style pillow to $ 64.98 for a king size comforter set.
Financial terms and the duration of the transaction were not disclosed. Still, the two companies said the brand was the start of a long-term partnership. Anthony Soohoo, Walmart’s executive vice president for the home, said customers should expect to see plenty of denim and chambray-inspired collections over the years.
“It’s not a capsule collection,” he said. “It’s a relationship that we believe we want to build, which is lasting for us. “
With the launch, Walmart will expand further into home and fashion, generate buzz, and potentially win over new customers. The retailer has added more general merchandise, from furniture to clothing, to its website to boost online sales and turn e-commerce into a profitable business. Walmart’s online sales in the United States grew 79% last year, compared to the previous year, as the pandemic pushed more shoppers online.
The retailer also has other private labels in the home category, including several developed with actress Drew Barrymore and one inspired by Better Homes & Gardens magazine.
The discounter also departs from a strategy of its great rival. Target has gained traction with exclusive brands and collaborations – like a limited-time homeware collection with Levi Strauss & Co. earlier this year and Hearth & Home, a brand developed with Chip and Joanna’s company. Gaines, Magnolia.
With strong sales throughout the pandemic, Walmart and Target have become the new take on department stores with a mix of merchandise, but in convenient locations outside of malls.
Gap is meanwhile working to win back buyers and sales after being hit during the pandemic. Even before the health crisis, it struggled to remain relevant to many consumers. Its namesake label Gap and Banana Republic brand were weak spots, while its Old Navy banner and booming Athleta business, which sells women’s workout gear, provided pockets of growth. He hopes to find the right mix of stores, across all of his brands, that will drive sales in the years to come.
For fiscal 2021, Gap forecast net sales to increase by a percentage between teens and teens from 2020 levels. The retailer is expected to report profits after the bell on Thursday.
Mark Breitbard, CEO of Gap’s global operations, said the retailer has been looking for new ways to capitalize on its brand through its licensing agency, IMG. For Gap, the deal gives the company a more predictable revenue stream and puts its brand in front of new customers who may not have shopped at its stores before, he said.
Gap and Walmart began serious discussions about the private label in December.
“It felt like this could be a very interesting partnership for us, and that’s how the conversations started,” said Breitbard. “And they just gained traction, and now we have two strong American brands working together. “
Retailers will promote the brand together, although Walmart will distribute it. Both groups of customers will receive emails regarding the launch. The Gap website will highlight some of the private label items and direct shoppers to the Walmart website.
Breitbard said Gap may also place merchandise in certain Gap stores. Going forward, he said Gap may license its brand to other retail partners in categories other than apparel and home.
“What we’re transitioning from is being a strictly vertical retailer selling clothing,” he said.