WalMart to Sell Levi’s

I always question deals like this because they could go either way.

Wal-Mart is becoming more of a fashion retailer as the sluggish economy and changing priorities have forced not only parents but their children to be more price-conscious. The world's largest company is expected to strengthen that reputation during the back-to-school season, powered by a deal with Levi Strauss & Co. that puts discount denim men's, women's and children's lines into Wal-Mart stores. The partnership marks Levi's debut at a discount chain.

The Levi's addition, along with Wal-Mart's makeover of its teen and preteen fashion areas, puts even more pressure on department and specialty stores that have lost back-to-school business to mass merchants.

"Levi's . . . will help identify us as a destination for credible fashion," said Celia Clancy, Wal-Mart's senior vice president of general merchandise and apparel.

The Signature Levi's jeans are priced from $18 to $24. That's about 15 percent to 35 percent less than the $30 to $35 price for Levi's most popular basic jeans called The Red Tab.

Besides adding Levi's, Wal-Mart has spruced up No Boundaries, its store brand for teens; expanded its Mary-Kate and Ashley label tied to the teenage TV celebrity Olsen twins; and brought in more stylish underwear. It soon will be adding a line of apparel linked to the Disney Channel's animated series "Kim Possible."

It could be a boon for Levi's and WalMart, who can both gain market share and hurt their competition. Or it could destroy Levi's image and make people see them as a "cheap WalMart brand." I blogged about a similar issue before when Sears acquired Lands End. I hope Levi's has done some market research before jumping into this deal.