Target’s Lilly Pulitzer problem: Is it a tech issue or a communication gap?

April 20, 2015 01:46 PM

Target’s website has crashed before when it featured exclusive designer fashion, notably for more than four hours in fall 2011 when it introduced the Missoni for Target apparel line. The latest hitch, in the wee hours Sunday as Target prepared to open the virtual gates to consumers champing at the bit for the brightly colored Lilly Pulitzer for Target line of clothes and accessories, paled in comparison., No. 16 in the newly released Internet Retailer 2015 Top 500 Guide, was stalled for 20 minutes, followed by limited access to consumers trying to browse the collection of 250 items before stores opened. Hours later, many items were sold out. And by Monday morning a women’s shift dress that on Target’s website was listed for $38 (sold out), sold for $132.50 in an eBay auction that attracted 23 bidders. More than 26,000 Lily Pulitzer for Target items were listed on the online marketplace Monday, from makeup bags to flip-flops to beach towels.

“They’ve done this before. They had problems with Missoni. I think they dramatically underestimate what the demand for the product is going to be,” Brian Kilcourse, managing partner at research and advisory firm Retail Systems Research LLC, says. “There’s been talk that Target experienced Black Friday-like traffic, but I don’t recall being down on Black Friday.

“The challenge for retailers with digitally connected consumers is that their primary objective, aside from selling things, is to drive people into the stores for the brand experience. And this case would seem to indicate that more communication needs to occur. The merchandise manager, the marketing manager, store managers, service levels from IT. It appears to me that those conversations didn’t happen.”

Representatives from Target could not be reached for comment Monday.

First announced in January, Target said it would be featuring an exclusive, limited-edition, 250-piece collection including clothing, beauty products and home goods from Lilly Pulitzer, the Palm Beach-style designer, which is known for its bright, colorful, and floral prints.

Items were quick to sell out Sunday, and high demand is causing shares of Oxford industries, the parent company of Lilly Pulitzer and other name brands, to surge today, rising more than 9%.

 “It’s going to be OK for Target. It’s generating a lot of social buzz,” says Kim Garretson, director at Realizing Innovation, a consulting firm. “On social media, people like to show their peacock feathers and say ‘I got one.’ Any downside from the resell and markup on eBay is going to be very limited compared to all the exposure on social sites. And with Target doing analytics on all that social data, that should provide some messaging on how to remarket when the goods come back in stock,” he says.

“I’m wondering if Target had any way to say ‘Sorry, we’ll alert you when an item is back in stock.’ Did they capture interest and intent when they were flooded?” says Garretson, who previously co-founded Ovative Group retail agency in Minneapolis and whose focus is on e-retailing and retail.

Kilcourse said he went to a Target store Sunday near his home in northern California to see how the Lilly Pulitzer sale was going. “I said to an associate, ‘Gee you must be busy today with the excitement of the launch.’ She had no idea what I was talking about.”

“This gets back to what you, as a retailer, really want the brand experience to be. It has to be designed. When you’re creating a brand value delivered in a digital and physical space, you better back it up with execution,” he says.

Bloomberg News contributed to this article.




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