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Posted Sep 26, 2006, 2:51 PM
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samsonyuen
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Join Date: Apr 2005
Location: Canary Wharf->CityPlace
Posts: 4,241
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From: http://www.thestar.com/NASApp/cs/Con...l=969048863851
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Quote:
George, Joe in fashion fight
Sep. 26, 2006. 07:35 AM
DANA FLAVELLE
BUSINESS REPORTER
You could call it Joe versus George in the latest battle of the goliaths.
As two of Canada's largest retailers — one a supermarket chain, the other a discount department store — prepare to duke it out on each other's turf, more than the price of lettuce will be at stake.
As Loblaw Cos. Ltd. pushes into Ontario's general-merchandise market in a bigger way and Wal-mart Canada Ltd. prepares to add fresh food to the aisles this fall, one of the battlegrounds will be fashion: not just any fashion, but high fashion at low prices.
In a grocery store and a discount mass-merchandise retailer?
You bet.
Wal-Mart has "George," its fashion-forward line designed in Britain, while Loblaws has Joe Fresh, named for Canadian designer Joseph Mimran, known from Club Monaco.
The implications for other retailers could be enormous as two of Canada's largest retailers aim to take a bigger bite out of the $18.7 billion a year apparel market. Even Sears Canada, the leader in women's wear, is watching the contest closely.
"There's a lot more competition in retailing than there was 10 or 15 years ago," said Sears spokesperson Vince Power.
It's partly the H&M effect. The fast-growing Swedish specialty retailer built a global empire making runway knockoffs at cutthroat prices and using celebrity models to flog them. The season's must-have Madonna tracksuit springs to mind as the latest example.
Now, it seems that every apparel retailer worth its salt, from Fairweather to the Bay, feels it has to have an entry in the "cheap chic" category. Fairweather is touting Isaac Mizrahi, a designer label that Target launched in the United States. The Bay has borrowed a page from Bloomingdales by adding edgier lower-priced labels, like I.N.C., to the high-fashion floor.
Both Loblaws and Wal-mart are putting big pushes behind fashion brands this fall.
Joe Fresh, first unveiled in March, will finally hit some Toronto-area Loblaws stores in the next few weeks. Wal-Mart, meanwhile, is promoting George with ads in hip urban magazines such as Toronto Life and a fashion show in Toronto's funky theatre district.
George is dressier, while Joe Fresh is more casual and everyday, but they have things in common: the low price point, good design and exclusivity to the stores. The idea is to discourage consumers from comparison shopping national brands to get the best price.
The low price tags on Joe Fresh and George could make some eyes pop out.
From Joe Fresh, this season's grey, down-filled vest is just $29. Or, for a little fun, how about the "fur-ocious" tote — a fake-fur-covered handbag — for just $12? A website, http://www.joe.ca, shows you how to wear it and an email list will keep you current.
From George, there's a grey checked jumper for $39 over a $17 white turtleneck and short black-patent boots for $29.
Blouses run $15 to $20, while outerwear is $79 to $99, Wal-mart said.
Consumers appear to like what they're seeing.
George is Wal-Mart's fastest-growing clothing brand, said Chris Johnston, the company's vice-president of apparel. Looking at sales in stores open more than a year, without the impact of new stores, "We've had double-digit growth," he said. "We're frankly excited and chasing that right now."
George aims to capitalize on the "fast fashion" trend by bringing the latest looks from the catwalk to the floor within eight to 12 weeks, he said.
Loblaws plans to expand Joe Fresh into more stores, including two former Caban locations, one at Queen's Quay and Jarvis St., the other at St. Clair Ave. and Bathurst St.
Industry watchers say it's too soon to tell how well either brand will perform. It depends on how much of the merchandise the stores actually stock and in what sizes, said Kaileen Millard, vice-president of apparel for market-research firm NPD Canada. The fastest-growing market for women's wear in Canada is women over age 45, who can't always wear the smallest sizes, she noted.
While younger women still like to shop, the impact of the "fast fashion" trend has driven prices so low that, even though people are buying more items, they're spending less.
As a business model and from a consumer perspective, fast fashion is a really neat concept, said Rick Wolfe, a retail consultant with PostStone Consulting, in Toronto.
For the retailer, it's a way to drive traffic to the store on a regular basis, by promising something new and fresh every time, he said. For the style-conscious customer, it's attractive "because I don't have to buy only four items a season. I can stay current on a monthly basis, and I can do it affordably."
Whether Joe Fresh and George will appeal to the same customer is doubtful, he added.
"Certainly, the Joe Fresh customer and the George customer is someone looking for `cheap chic.' But, arguably, the Wal-mart customer is lower income than the Loblaw customer," he said. "My hunch is that in one way their targets overlap, and in another way they don't."
NPD's Millard said not all consumers even want cheap chic. Some are just looking for good old-fashioned basics that fit and wear well.
One of the fastest-growing Canadian clothing chains is Mark's Work Wearhouse, Millard noted. Mark's sells what many would consider wardrobe staples, from relaxed fit denims to pre-shrunk canvas shirts. Other retailers, such as Sears, maintain their positions by offering something for everyone, in every size, from petite to plus.
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