Target Refocusing on 'Signature' Categories

Target has been moving quickly and decisively to put the data breach of holiday 2013, failed international expansion into Canada and multiple merchandising mishaps behind it, unveiling a series of new priorities and in-store initiatives to further grow sales during a financial community meeting this week.The retailer is refocusing on its grocery business, which accounts for one-fifth of Target’s nearly $73 billion in annual sales and ties closely to its focus on wellness. Seeking to appeal to younger, urban shoppers and differentiate its offerings from channel competitor Walmart, Target is giving more prominence to six key specialized categories:Yogurt/GranolaCoffee/TeaBetter-for-You SnacksWine/Craft BeerSpecialty CandyPremium Sauces & OilsOverall, the retailer is planning to add more organic, natural and gluten-free foods while also becoming much more localized in assortment. The moves might mean that well-known brands from giants such as Kellogg Co., General Mills and Campbell Soup Co. will see a decrease in shelf space as the retailer moves away from mainstream grocery. Target will test and iterate in 2015 and then amplify efforts in 2016, and is currently looking externally for expert talent to lead this repositioning.More broadly, the retailer is also investing in product development, marketing, fixtures and store service to elevate and differentiate the assortments and the shopping experience for its four “signature” categories: style, baby, kids and wellness.The in-store landscape has already been changing as Target employs a test-and-learn method to quickly try out a variety of new in-store display initiatives. The retailer is killing those that don’t work, while rolling out more successful programs. The initiatives it is keeping seem to be those that help stores tell more stories and provide more well-rounded “experiences.”The Institute’s store visits additionally show that the mass merchant is increasingly utilizing temporary merchandising displays as part of its seasonal campaigns, especially holiday and back-to-school. The activity began as floorstands in apparel departments, generally merchandising small giftables such as socks and accessories. More recently, the displays have also stocked such items as Unilever’s Axe body products and Campbell’s Pepperidge Farm crackers.Other departments, including grocery, health and beauty, increasingly utilize sidekicks, power wings (for convenience items such as tape or turkey oven bags) and floorstands (for small giftables). Glorifiers have also made their way onto shelves in the toy department.With few exceptions, the temporary displays are always customized for Target.

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