Would You Buy Luxury Clothes From Walmart?

Image courtesy of Mike Mozart/Romano's Macaroni Grill

On the surface, Walmart and luxury department store Lord & Taylor don’t have a lot in common outside of selling clothing. But that could soon be changing. 

The Wall Street Journal, citing people familiar with the matter, reports that the two companies are in talks to team up to take on every retailer’s rival, Amazon.

Sources say the unlikely duo are close to inking a deal that would see Lord & Taylor receiving a dedicated space on Walmart.com to sell its products.

You Help Me, I’ll Help You

The potential partnership could be beneficial to both parties.

Like other department store chains, Lord & Taylor — owned by Saks Fifth Ave parent company Hudson’s Bay — has been struggling in recent years to keep customers in the door.

Back in June, Hudson’s Bay cut more than 2,000 jobs as it scaled back its workforce. News of the employee downsizing came on the same day that the retailer reported a 3% decline in retail sales to about $2.37 billion (or $3.2 billion Canadian) for the first quarter of 2017.

By selling products on Walmart.com, the company would be tapping into another avenue for sales — and customers — it might not otherwise reach.

Additionally, the partnership would add convenience for Lord & Taylor customers. For instance, sources tell The WSJ, that eventually, customers who make purchases from either Lord & Taylor’s website or from Walmart’s could pick up those orders at their local Walmart store.

On the other side of the deal, offering higher-end clothing and other products could be Walmart’s way of trying to attract customers with more disposable income.

The idea is if these customers purchase more expensive clothing from Walmart.com, they might stick around and buy other things, like groceries.

A One-Stop Shop Site

The possible deal is just the latest effort from Walmart in turning its focus toward online sales.

Walmart is looking to create a website that would mirror a mall, where customers could shop from a variety of different brands, including those the retailer has already purchased, such as Modcloth, MooseJaw, and Bonobos.

This brand-heavy website would also be similar to something else we’ve already seen: Amazon’s marketplace.

Rumors of talks between Walmart and Lord & Taylor come just a week after Walmart e-commerce head Marc Lore highlighted his plans for the retailer’s website.

The WSJ reports that Lore’s immediate plans for the site included “elevating the Walmart.com brand by redesigning the site and creating partnerships with more premium brands.

Still Work To Do

Despite Walmart’s push to increase its online presences — buying online retailers and revamping its shipping services — the company still has a long way to go before catching up to Amazon.

For instance, The WSJ reports that while Walmart is positioning itself as the only company with the ability to beat Amazon, the retailer’s website receives just half the visitors Amazon’s marketplace sees.

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