Wal-Mart has launched a new private label, Modrn, aimed at the growing online sales of the furniture market. Wal-Mart began to occupy a place in the home market through the previously acquired consumer unicorn company, absorbing experience and using its vast network of resources.
New brand MoDRN
Anthony Soohoo, senior vice president of Wal-Mart e-commerce and general manager of the group, wrote in a blog post on Friday that the brand is aimed at customers who want to buy stylish furniture at a lower price, as well as an increase in visits to the Walmart.com home product page. % response.
Now, the company wants to focus more on the so-called professional shopping experience, aiming to develop a variety of fashion collections that can only be found online.
Part of the transformation includes adding edited images and content to make it easier for customers to browse and discover new categories. This is why MoDRN was introduced.
Soohoo said: “MoDRN is designed to embrace the modern aesthetics of its customers, with three incredible fashion collections – Retro Glam, Refined Industrial and Scandinavian Minimal. MoDRN has launched nearly 650 items that can be used in all spaces of the house. It offers a high-end look and a high-end look at the store, but at an affordable price."
Modrn will be sold through Walmart.com, Jet.com and Hayneedle, with prices ranging from $199 to $899, including sofas, beds, bar furniture, indoor and outdoor dining and chairs.
Specifically, MoDRN's products use materials such as velvet, carrara marble, hand-brushed metal, oak and walnut. Sofas range in price from $700 to $899, bed prices range from $599 to $649, indoor and outdoor furniture prices range from $199 to $699, and tableware prices range from $20 to $60.
Soohoo said that these products are just the beginning, and there will be more other types of products soon.
He also said, "We have other exclusive works, and I can't wait to show it to the public in the coming months. I am proud of the shopping experience I developed. Customers also told us that they are easy to find the latest home products and trends at Walmart. Now, they can also buy everything they need for modern homes."
Wal-Mart in the home market
This is not the first time Wal-Mart has ventured into the online furniture brand, which acquired online furniture retailer Hayneedle for $90 million in 2016. Wal-Mart continues to increase its position in the market, taking advantage of the lessons learned from the acquired companies and putting it into practice through the introduction of newer private label products, which will eventually stand out from the competitions of Wayfair, Target and Amazon.
In addition to Hayneedle, Wal-Mart also acquired online brands Jet.com, Bonobos, Modcloth and Moosejaw to expand their digital coverage and understand the preferences and behaviors of young and online customers.
Tom Gehani, Head of Customer Strategy and Research at Gartner L2, said: "Wal-Mart has a lot of ideas in this area, taking a approach from every possible perspective, acquiring both the brand and the new brand within the company. Wal-Mart has acquired like Bonobos, Modcloth and Hayneedle Such companies are also beginning to adopt these design sensitivities and incorporate these designs into the new Wal-Mart brand. For example, many of the George brand men's looks look like Bonobos, and many of their furniture looks like Hayneedle's."
According to Gartner L2, the online furniture and homeware market is expected to double in the next five years. According to eMarketer's estimates, AOL's online furniture and home sales are estimated at $50 billion in 2018.
According to Gartner, Amazon’s sales in the household category have increased by 40% in the past two years, and Wal-Mart has not invested enough in this area. In addition, Wal-Mart only accounts for 44% of Google’s 277 family-category products, while Wayfair is 81% and Amazon is 65%.
Acquisition, learning and practice
Through the data and solutions of the acquired brands, Wal-Mart can reach out to a typical young and urban customer, which is in stark contrast to Wal-Mart's large discount store model.
Jane Hali & Associates CEO Jane Hali said: "Wal-Mart has more data by acquiring the online original brand, they have been developing for a while, the advantage is to understand the customer's purchase."
And the launch of online brands with more high-end products, the purpose is to attract other customers. The acquisition of brands directly facing consumers can also expand the customer base.
However, its own brand is another battlefield, Amazon and Target also launched a new brand to cater to different customer groups. The core merchandising strategy is to drive product sales with higher margins and sell exclusive branded products through specific retailers.
Gewali said: "Wal-Mart knows that some customer groups don't want to buy anything at Wal-Mart. And by acquiring a brand to get services, these customers can be won, and they can attract more people to shop at Wal-Mart, so Wal-Mart can do this. The way to start is to bring Bonobos products directly to Walmart.com or Walmart stores for sale."
In recent years, Wal-Mart's own brand strategy has shifted from affordable to high-end products, in part because of the acquisition of several direct-to-consumer brands.
Gehani said: "Wal-Mart may begin to increase its partnership with supply chains, factories and designers to produce better design products than before."
While Wal-Mart is taking on the risk of launching a new brand, its logistics network and its relationship with suppliers and designers make the overall logistics network better than its competitors.
Andrew Essex, CEO of Plan A and co-founder of Droga5, said: "I am very optimistic about this idea. Wal-Mart has incredible trust and distribution. Its brand is very good, fresh and modern, it feels like a brand new thing."
Andrew Essex said Wal-Mart's biggest risk is impatient, as well as competitors in the online furniture market launched by rivals Amazon, Target and Wayfair. Despite these obstacles, Wal-Mart's size ensures that it can take its place in market share.
He added: "Let the incumbents learn from the unicorn company that faces the consumer, and then use Wal-Mart's vast resources to develop, and Wal-Mart's approach is very promising."