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Target boosts millennial foods

News, 04 March 2015
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MINNEAPOLIS: Target, the retail chain, is prioritising seven grocery categories known to be favoured by millennials, urban consumers and Hispanic shoppers in the hope of boosting its appeal with these audiences.

Products expected to receive heightened attention as a result of this revitalisation effort include beer and wine, yoghurt and granola, coffee and tea, fresh meat and produce, candy and snacks.

Additional areas of emphasis for the firm - according to an article in the Wall Street Journal - include organic, natural and gluten-free foods.

While such items will not automatically obtain greater room on Target's shelves, their status in its displays, marketing and merchandising is set to increase significantly.

Brian Cornell - who was named as Target's CEO in July 2014 - is said to be personally involved in transforming its grocery business, which delivers some 20% of the company's $73bn revenues.

Cornell has previously worked at PepsiCo, Safeway and Sam's Club, and is reported to have looked at stores run by Trader Joe's and Wegmans in considering the way forward for Target.

One objective behind the organisation's desire to spruce up its grocery aisles is achieving differentiation from Walmart, its major rival.

A poll of Target's customers from Kantar Retail, the research and consulting group, revealed that only 18% of participants believed the food sold by the chain reflected what they like cooking and eating.

Moving away from packaged and processed offerings - which are less popular with younger consumers than their predecessors - could be a valuable step in altering perceptions.

Cornell has left no doubt, however, that modifying Target's food business is a long-term endeavour rather than a quick fix.

"We recognise we have a lot of work to do in food," he recently informed investors. "We won't get there overnight."

Enhancing its standing among younger buyers forms part of a wider sharpening in Target's strategic vision, from opening smaller stores to tailoring in-store selections to local tastes and increasing online sales.

Its other recent objectives have included rebuilding trust following a high-profile data breach and boosting the sustainability of its advertising production efforts.

Data sourced from Wall Street Journal; additional content by Warc staff

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