Off-price has long been the outlier in eCommerce in America. Many of these companies haven't had websites.

When I read Daphne Howland article about TJX HomeGoods launch of eCommerce next year, my first thought was "with home exploding this year, they had a serious missed opportunity to experiment."

The problem of course is that such off-price - many unbranded - items are already abundant online at sites like Wish and AliExpress.

Off-price has traditionally been about taking full-price goods and apparel after the traditional retail markdowns have run their course and giving it new life at a significant discount. With off-price, the model has to be different due to the cost of shipping. Specialized payment and financing solutions need to be part of the margin profile. Subscriptions need to be abundant. Basket sizes and bundling need to be maximized at every turn.

I always thought the value prop of HomeGoods was "cheap things that are good enough." You aren't looking for things that will last forever.

That value prop isn't going anywhere due to the COGS of the items. My biggest question for them is -- do they even stand a chance against the major marketplaces, and if so, how?

David Spain had a great analogy. Here’s an excerpt from him:

Onboarding off-price Merch for Ecommerce is a treadmill set at 30 mph - no sooner is it up, then it is sold out. Add to that equation most off-pricers do not have the data or DC chops to leverage overstock purchases to Ecommerce formats and ops. If they could source a mix of everyday low goods as Ecommerce bread n butter they might gain some traction vs the massive investments needed in systems and operations to engage their customers online. It’s a hard road and not a slam dunk strategy for off-pricers to go online.

Jason Greenwood stated a bit more directly: “The biggest issue I see is product churn and website maintenance. Huge huge costs there. Off-price is about short run items, heavily discounted. That means the catalog is a moving feast. That’s at odds with the need to have deep and rich product data to effectively sell online.”

David McCary had an interesting point: “One distinct advantage they have is already having distributed inventory. If they can figure out logistics and have accurate inventory data then Free and Fast shipping could be realistic from day 1.”

Jon Kuhlman added another interesting point, saying “Off-price is more about the "buy" than the "sell." If inventory is bought right, there is plenty of room for the auxiliary costs. The dilemma also involves availability of inventory. If an off-price retailer is forced into filling out selection with private label and MFO (or bad buys), these decisions can make or break.”

There was also some talk about how to recreate the “treasure hunt” experience of in-store off-price shopping for online. One suggestion was to gameify the shopping experience; another was to create a subscription box (think: StitchFix) which may end up as a nightmarish cycle of returns, though it could be fun to get a weekly/monthly box of mystery items. In any case, I will be interested to see how the experience converts to e-commerce.