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BUSINESS
Macy's to debut exclusive deal with Tommy Hilfiger
CINCINNATI -- Macy's stores across the country are renovating their Tommy Hilfiger shops and expanding how much of the designer's sportswear they carry. But fans of the brand soon won't be seeing those items at other department stores.
Starting next week, Tommy Hilfiger U.S.A. will have an exclusive alliance with Macy's that leaves it as the only U.S. department store operator offering the company's men's and women's sportswear.
The launch comes as department stores increasingly turn to exclusive offerings to set themselves apart in a market where shoppers are focusing on basics like fuel and food and turning to discounters for lower prices.
Exclusive deals have been among the bright spots for department stores amid the sales slowdown, but analysts say a big-name and popular designer like Hilfiger brings extra clout.
"With Tommy Hilfiger, Macy's also will be offering the non-diluted, full-meal deal," said Patricia Edwards of investment manager Wentworth Hauser and Violich. "They didn't just get the name, they got the same quality goods."
Among other chains that have struck exclusive deals are Kohl's Corp., which while cutting its inventory of basics introduced a line of apparel and home furnishings from designer Vera Wang, called Simply Vera, with prices far below what her designs usually command. Kohl's will also be the exclusive U.S. retailer for the Dana Buchman brand designed by Liz Claiborne Inc., while J.C. Penney Co. alone has the American Living collection from Polo Ralph Lauren Corp. and has developed labels with designer Nicole Miller and home furnishing expert Chris Madden.
Macy's, which has already had success with its exclusive home furnishings collection from Martha Stewart, is seeking more exclusive alliances with other major designers. Chairman and CEO Terry Lundgren said the timing of the Hilfiger deal couldn't be better, especially given the brand's strong sales.
"The menswear has always been good, but they really got their act together in design and continuity of the women's apparel," Lundgren said. "The merchandise looks younger and more modern, but still very Tommy Hilfiger."
Fred Gehring, chief executive of Tommy Hilfiger Group, said menswear sales were stronger than in the women's line when discussions with Macy's began a few years ago.
"They wanted to see how things would materialize with our new approach to the women's side, and that business is now extremely strong," Gehring said.
The alliance beginning Sept. 9 will be heralded with a week of events in Macy's stores including appearances by Tommy Hilfiger and in-store promotions. Besides expanding the merchandise assortment in stores and on its Web site, Macy's is increasing the number of stores carrying the sportswear from 350 to more than 500. Hilfiger, who has appeared before in TV ads for Macy's, will be featured more prominently in the fall and holiday season. Macy's also will send its credit card customers a special Hilfiger catalog.
