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Target once again used scarcity as a marketing tactic when the buzz over its collaboration with Lilly Pulitzer propelled the capsule collection to a rapid sellout online and in stores, according to retail experts.
Frustrated consumers complained on Twitter when the demand overwhelmed Target’s site and mobile shopping app, prompting comparisons to Target’s 2011 Missoni collection that crashed the store’s site for several hours.“It certainly gets them press," said Bob Phibbs, CEO of the Retail Doctor, a consulting firm. “I don’t know how effective it is at building loyalty and repeat business.”
The technological issues that dogged the launch could have been prevented, said Forrester Research analyst Sucharita Mulpuru.
“This is not rocket science at this point,” she said. “We’ve had 20 years of e-commerce history where there are bursts in demand.” Other online retailers such as Amazon have managed to cope with surges in use, she pointed out, and Target should have expected that visits to its site would surge and done more to prevent the problems some users experienced.
The launch was initially scheduled to begin online at 3 a.m. EST, but Target pushed it back, then shut the site down for a short period before the sale began and limited the number of shoppers who could access the site, sparking shopper frustration.
“The hardest thing to do is fix it once it happened,” Mulpuru said.
Morningstar analyst Ken Perkins speculated Target might have underestimated the popularity of the Lilly Pulitzer collection, even though the retailer heavily promoted it leading up to the Sunday launch. Its chief merchandising officer Kathee Tesija told CNBC the company had ordered a larger amount of inventory for this collection, anticipating that there would be enough to last into next month.
Perkins said the overwhelming response was positive for the retailer, even with the technological glitches.
“It’s good to have these initiatives,” he said. “It drives people into the store and helps build their brand,” he said, although he added that the angry chorus of frustrated customers on Twitter and Facebook is something Target needs to address.
“Social media allows people to have a voice,” he said.
Target’s differentiating factor from its big-box rivals is its cheap-chic focus, although some of its capsules lately failed to capture the kind of attention and sales earlier that collaborations with designers like Jason Wu had delivered.
The poppy, preppy Lilly Pulitzer clothes and home goods help Target re-establish that reputation.
“The positives are that the demand is there. [It’s] something that Target continues to be able to do,” Perkins said.