DIS Walt Disney Co

By Kimberly Chin 

Target Corp. and Walt Disney Co. have joined forces to open dedicated Disney Stores in about two dozen Target locations starting this fall, the latest example of a large retailer offering a specialty shop within its walls.

The companies said Sunday they plan to open 25 Disney Stores at Target locations across the U.S. on Oct. 4. By the end of 2020, the companies expect to add an additional 40 Disney Stores at Target locations.

The Disney "shop in shop" locations will be run and operated by Target employees and will include more than 450 items, such as toys, games, apparel and accessories, including items that had previously been exclusive at Disney retail locations.

Retailers are increasingly carving out space in their stores for other brands and concepts. J.C. Penney Co. and Macy's Inc. recently said they'd set aside space within some of their stores for resale marketplace thredUp Inc. Also, Kroger Co. has branded sections in some stores of Walgreens Boots Alliance Inc.

Target has long collaborated with celebrities and designers for exclusive products and collections. Over the past 20 years, Target has worked with designers ranging from Anna Sui to Lilly Pulitzer on exclusive lines.

As part of the Disney partnership, Target plans to open a new store at the western entrance of the Walt Disney World Resort in Orlando, Fla.

For Disney, the move represents a major expansion of its retail-store presence. The Burbank, Calif., company currently has 300 Disney Store locations. The new partnership will boost Disney's store count by about 22%.

The move helps extend Disney's reach beyond its mall locations, said Bob Chapek, Disney's chairman of parks, experiences and products, on a call with media.

In its latest quarter, Disney said its retail stores helped boost revenue in its parks, experiences and products division by 7% to $6.6 billion.

Still, malls continue to struggle with foot traffic and store closures. The national mall vacancy rate was 9.3% this quarter at the end of the second quarter, up from 8.6% a year earlier, according to real-estate research firm REIS Inc.

The Target shops are set to open around the same time when products tied to the coming Disney films "Frozen 2" and "Star Wars: The Rise of Skywalker" will hit shelves.

The companies declined to say how much revenue they expect to generate from this partnership.

Write to Kimberly Chin at kimberly.chin@wsj.com

(END) Dow Jones Newswires

August 25, 2019 17:43 ET (21:43 GMT)

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