EBay Follows Target, Aims for High-End Retail
A mass-market retailer is going high end ... again.
Following in Target’s footsteps, eBay announced plans on Tuesday to partner with a handful of designers during the upcoming holiday season as both retailers jockey for a slice of slumping U.S. retail demand.
The eBay Holiday Collective will feature original, limited-edition items of men’s and women’s apparel, jewelry, travel and electronics accessories and home decor. The collection, which will be comprised of more than 40 pieces, goes on sale on November 12 at prices ranging from $50 to $100.
The chosen designers include Jonathan Adler, Steven Alan and Tibi. Adler, who already has a collection at Target , is no stranger to the collaboration scene.
The effort is eBay’s latest attempt to ramp up its fashion-based business. In June, the company began a four-city tour to create buzz for its online fashion listings after earlier joining forces with the Council of Fashion Designers of America to fight counterfeiting.
It also runs the Fashion Vault, a flash-sale type platform, and the Fashion Outlet, an online outlet that sells designer items at discounts of roughly 20 to 65 percent.
The collection’s relatively early start date will give the company an advantage over Target at reaching shoppers’ carts first. Last week, Target announceda deal with high-end department store Neiman Marcus to features products from 24 designers in both companies’ stores starting on Dec. 1.
The Neiman Marcus deal is the most recent designer coup in a long list for the Minnesota-based retailer. Last fall, the frenzy surrounding Target’s collaboration with Missonicaused the site to crash multiple times. Some buyers even turned to eBay and Craigslist to sell their Missoni purchases at multiples of their original price tags.
Following the announcement of the Neiman partnership, a senior analyst at MKM Partners said Target’s merchandiselooks better than it’s looked during the 10-plus years that he has covered the company.
Meanwhile, Barclays maintained its "overweight" rating on Target shares, and Citigroup reiterated its "buy" rating but cautioned that the U.S. consumer may be entering the upcoming holiday season with a more tightly guarded wallet.
“We expect the Target + Neiman Marcus Holiday Collection to boost traffic and grow the topline for TGT this holiday season, in-line if not above results from previous exclusive fashion collaborations,” Citigroup's report said.
But the excitement stemming from the deal could not trump macroeconomic concerns, and Citigroup subsequently downgraded the stock to a “neutral” on Tuesday.
As part of a more cautious forecast for the second half of the year, Citigroup said it sees “consumers finding ways to save on the necessities in order to stretch their discretionary budgets” and cautioned that Target could be seeing “empty backpacks” during this back-to-school season.