Volume 1, Issue 2, Winter 2001 MARKETING FASHION COLOR FOR PRODUCT LINE EXTENSION IN THE DEPARTMENT STORE CHANNEL Marguerite Moore University of Tennessee Nancy L. Cassill North Carolina State University David G. Herr and Nicholas C. Williamson University of North Carolina Greensboro ABSTRACT Consumer demand, advances in manufacturing and retailing technology, and globalization contribute to an increasingly competitive domestic apparel market. In order to compete, retailers and manufacturers adopt aggressive product strategies designed to capture discerning consumers. A popular strategy for product line extension in the apparel industry is the addition of fashion color to core lines. Academics and practitioners alike have suggested that color can stimulate interest and, subsequently, sales of apparel products. The current study examines the impact of visible fashion color on sales of women’s core apparel products in the department store context through a quasi-experimental approach. Hypothesis tests suggest that greater depth and magnitude of fashion color does not increase sales of either fashion color or basic color apparel. Managerial implications are offered for product strategy as well as future directions for academic research. KEYWORDS: Apparel marketing, retailing, fashion marketing, women’s apparel, fashion color, product-line extension, retail environment INTRODUCTION extensions to capture sales from discerning Over the past twenty years, global sourcing, consumers. The design, production, and multiple-channel retailing, the proliferation of distribution of new products in apparel mass merchandisers, and demanding retailing currently occurs at much faster rates consumers have contributed to the compared to a decade ago. Retailers such as development of a dynamic and highly The Limited, Inc. attribute their success to the competitive U.S. apparel market. In order to ability to design, manufacture and deliver compete in today’s market, retailers and goods to the selling floor within a six-week apparel manufacturers are increasingly time frame (Biederman, 2000). adopting new product strategies, including both new innovations as well as product line 1 JTATM Volume 1, Issue 2, Winter 2001 A popular product strategy among apparel Through the use of a quasi-experimental manufacturers and retailers is to inject fashion design, this study provides an empirical color into previously existing product lines. In investigation of the effect of fashion color on many categories including active-wear, denim, sales of apparel in the retail setting. Increased and intimate apparel, designers use fashion understanding of the impact of fashion color color to add newness to an existing line and, in within the retail environment aids in informing turn, attract consumers to the entire product future product line extension decisions among line. Compared to a radical new innovation, apparel manufacturing, marketing and the process of extending a product line retailing practitioners. Further, investigation through the addition of fashion color appears of fashion color line-extension among a to be simple. However, the requirements of product line that is typically marketed for its fashion apparel production including: longer performance attributes, contributes to our lead times for production, procurement of new knowledge of target marketing in the apparel materials, coordination of color shading, context. production of samples, and execution of short production runs are comparatively riskier than BACKGROUND AND HYPOTHESES those of core apparel production. Further, The practice of consumer firms using color to difficulty in forecasting sales for new apparel attract attention to new products, packaging, products poses additional problems in and retail space is widely noted in the trade predicting demand—compared to core literature (Cowan, 1993; Kotler, 1999; products with clear selling histories (Urban, Triplett, 1995). Unfortunately, there is Weinberg & Hauser, 1996). Forecasting error currently no empirical evidence to uphold the can lead to expensive inventory carrying costs claim that color actually influences the or stockouts at the retail level, which can purchasing behavior of consumers specifically erode profits as well as customer loyalty for for apparel products. However, there is a the retailer (Clarke, 1987; Emmelhainz & related stream of research in the academic Emmelhainz, 1991). retailing literature that considers the influence of the store environment on consumer Although fashion color line extensions are a behavior. Borne out of environmental common strategy among apparel companies, psychology, researchers such as Donovan and we know very little about their impact on sales Rossiter (1982), Slama and Tashchain (1987), of the entire product line. Because this type of Buckley (1991), and Donavan, Rossiter, product extension can result in sizable profits Marcoolyn, and Nesdale (1994) have when they succeed, or great costs when they examined the impact of store environment fail, it is important to understand their role in stimuli on consumer emotions and purchasing marketing apparel. To date, no single study behavior through operation of the Mehrabian- has investigated the role of fashion color line Russel (M-R) Model. Based on the Stimulus- extension in the apparel context. The purpose Organism-Response (S-O-R) framework, the of this study is to examine the effect of fashion M-R model contends that environmental color introduction on the sales performance of stimuli lead to emotional states (i.e., a basic color (i.e., core) apparel line. pleasure/displeasure, arousal/non-arousal) Specifically, the study investigates whether which in turn lead to approach/avoidance increased quantities of newly introduced behaviors. The majority of this research fashion-color inventory will impact sales in an focuses on the ‘emotion’ interface between apparel line that is typically marketed for its stimulus and response (Buckley 1991; performance rather than its style. The context Donavan, Rossiter, Marcoolyn and Nesdale, selected for the study is the women’s intimate 1994). apparel category in the department store retail channel. In their 1982 study, Donovan and Rossiter pointed out the difficulty of isolating stimuli in the retail environment. They indicated a need 2 Volume 1, Issue 2, Winter 2001 for greater understanding of in store stimulus Therefore, we propose the following including examples such as, “color hypotheses: arrangements, store layouts, noise levels and in-store promotions…”—for their effect on H2: Greater quantities of visible fashion emotions and ultimately on shopping color will positively influence sales of behaviors (1982, p.40). Further, the these goods within the retail researchers point out that, in keeping with the environment. M-R model, ‘information load’ in the complex retail environment can affect consumer H3: Greater quantities of visible fashion arousal. That is, environments that are color will positively influence sales of characteristically ‘high-load’, including more the core goods with which they are features and change, tend to stimulate displayed within the retail customers compared to environments that are environment. ‘low-load’ which make consumers feel calm or relaxed. METHODOLOGY The intent of the current study is not to Research Design directly test the M-R framework. In fact, The study employed a quasi-experimental emotions are not measured in the study. method to investigate the hypotheses. The However, the work of Bellizzi and Hite quasi-experimental design facilitated (1992), Buckley (1991) and, Donavan, investigation in the realistic retail Rossiter, Marcoolyn and Nesdale, (1994) have environment. In order to provide a useful empirically linked in-store stimuli to emotions result for both academics and practitioners, it and behaviors including purchasing intent and was important to measure the impact of the actual behavior. Therefore, we hold that the additional color within the retail setting. stated research provides conceptual Therefore, a degree of internal control was justification for investigating the effect of traded-off for the external reality required for fashion color on shopping behavior within the insight into the question of interest. However, retail environment. Based on this research, we to provide an acceptable degree of internal agree that department stores are validity the following rules of quasi- characteristically high-load, and propose that experimental design were applied to the adding new fashion-color products to displays current research: selection of equivalent within this environment can stimulate groups for testing, assignment of manipulation consumers. In agreement with previous M-R and controls among these groups, and testing research, this stimulation in-turn can influence for differences among these groups (Cook and consumers to spend more time and money in Campbell, 1979; Kerlinger, 1992). the retail environment. Therefore, we hypothesize the following: A U.S. market leader in the branded manufacture of women’s department store H1: Greater quantities of visible fashion intimate apparel was selected to participate in color will positively influence sales of the study. The company agreed to increase full product-line in the retail visible quantities of fashion color merchandise environment. within a featured product line for the upcoming spring selling season (seven weeks) We also reason that fashion color within a in two test stores in two separate test markets