The news: Walmart is introducing a private apparel label, Scenario, as it looks to strengthen its appeal to cost-conscious yet fashion-forward shoppers, per The Wall Street Journal.

• Most Scenario items will be priced below $25, which Walmart considers an opening price point for customers.
• The retailer will reallocate space previously used for its Time and Tru label to showcase the new brand.

What it means: Bolstering fashion credibility is a central plank of Walmart’s strategy to gain more discretionary spending and strengthen its position with higher-income consumers. Under Denise Incandela, executive vice president of fashion for Walmart US, the company has gone from being mainly a purveyor of affordable basics like socks to a more formidable apparel retailer, with six brands generating over $1 billion in revenues, Incandela told Modern Retail.

More expensive owned brands like Scoop and Free Assembly are boosting the retailer’s fashion credentials, particularly among younger and wealthier shoppers. Forty percent of Walmart Fashion customers have household incomes of at least $100,000, while 35% are between the ages of 25 and 44.

While more affordably priced than Scoop or Free Assembly, Scenario is similarly designed to lure younger customers with more discretionary income. The brand’s target audience is women around 35 years old, lead designer Marcus Brown told The Journal. Designs will mostly feature natural materials, aligning with consumers’ current preference for natural fibers, and have a boho aesthetic to appeal to more trend-conscious shoppers.

Implications for retail: Walmart’s fashion initiatives are taking on new urgency after a quarter in which it reported its worst same-store sales growth in over six years. Having a more trend-focused, attractive apparel collection could give Walmart a stronger shot at spending from younger, more affluent shoppers, much as Target’s collaborations with brands like LoveShackFancy and Rosie Assoulin are helping to reestablish it as an exciting place to shop.

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