Target Reveals What Went Wrong With Neiman Holiday Line, Has High Hopes for Kate Young Collection

Target has high hopes for its spring line from stylist Kate Young, which will launch in April. Pictured is a sketch from the collection of special-occasion dresses. (Image courtesy of Target.)

The Target + Neiman limited-edition holiday collection, launched December 1 at both chains, ended its run last week at the cheap-chic discounter.
Although critics have branded Target’s co-branded line with Neiman Marcus department stores a flop, the retailer says it’s learned valuable lessons from the apparel and home gift collection that will inform upcoming lines.
The line, which boasted merchandise from 24 upscale designers such as Diane von Furstenberg, Oscar de la Renta and Tracy Reese, was priced too high, was ill-timed within the holiday season, and the retailer overestimated product demand, Joshua Thomas, a Target spokesman, told Forbes, during a preview of a spring fashion collection from celebrity stylist Kate Young in New York City this week.
But when you build your brand and business practices around being an edgy retailer, “If you talk the talk, you need to walk the walk,” Thomas said. Being willing to innovate “and take risks means being ready to accept the things that work, and the things that don’t work.”
For one, the price wasn’t right.
The Target + Neiman line was priced from $7.99 to $499.99, with most items hovering in the $60 range. And although the collection represented great value at affordable price points, featuring items made from real silk, hand-blown glass and 18k gold, “maybe it was [priced] a little too high,” Thomas said.
To compound matters, the launch date fostered the perception that the line was unaffordable.
The collection hit Target stores on December 1, sandwiched between the two most promotional peaks in the holiday shopping season: Black Friday and the final week before Christmas, he said.
So just when consumers were  ”looking for bargain hunting cues,” Target was selling a full-price collection, “as it wasn’t discounted at that point,” he said.  ”So the timing was a challenge.”
Indeed, when the collection was later marked down by 50 percent, “we saw a significant percent uptick in sales.”
What’s more, the line was too heavy on inventory because Target didn’t want to disappoint shoppers by running out of merchandise.  It turns out demand did not meet the hefty supply, and “in hindsight, we probably overcorrected,” he said.
It’s no secret that  the Target + Neiman collection stands in stark contrast to the discounter’s wildly successful Missoni launch last year. Pundits have compared the contrasting lure of the Target/Neiman and Missoni lines ad nauseam.
Target’s website crashed the day the retailer premiered the Missoni line in the fall of 2011, after it failed to anticipate the extraordinary demand the launch would generate.
But Thomas says the line was an outlier, as the demand “was not normal. It was unprecedented.”
And despite perceptions, “millions of people shopped the [Target/Neiman] collection … and at the end of the day, we ended up moving most of the product,” he said.
Now Target will “explore new territory and push the boundaries” with a line of mostly special-occasion dresses from Kate Young, the stylist who worked with designer Jason Wu  (whose name is on everyone’s lips this week, as Michelle Obama donned his inaugural gown) on his collection for Target last year, as well as celebs such as Natalie Portman, Michelle Williams and Rachel Weisz.
The line has a vintage feel that draws from Young’s red-carpet, Hollywood looks, and hits Target stores nationwide on April 14.
It’s “edgy, [as Young] is known for this cool-girl glamour that could be worn by a 17-year old headed to the prom or a 36-year old going to a spring picnic,” Thomas said.
It’s also affordable, priced from $29.99 to $89.99, with accessories from $14.99 to $49.99.

From a business perspective, Target is looking to “exploit its guests appetite for dresses,” an item it’s only dabbled in but one that has “always done very well for us,” Thomas said.
Stay tuned.