Prime Highlights
- Target plans its largest store transformation in a decade, revamping multiple departments to revive customer traffic and restore its reputation for stylish, unique merchandise.
- The retailer will launch “Beauty Studio” in more than 600 stores and online, replacing its partnership with Ulta Beauty and introducing prestige brands, improved displays, and a loyalty program.
Key Facts
- Target expects net sales to increase by about 2% in the current fiscal year as part of its turnaround strategy.
- Grocery space will expand in remodeled and new stores, with fresh food sections doubling in many locations and up to 50% more new snack and dry grocery items being introduced.
Background
Target is preparing a broad transformation of its stores as it works to reverse falling customer traffic and revive sales growth. The retailer shared its strategy during an investor meeting at its Minneapolis headquarters, outlining changes that shoppers will begin to see this year.
Chief Executive Officer Michael Fiddelke said the overhaul will touch more areas of the store than at any time in the past decade. The company aims to restore its reputation for stylish and unique merchandise while driving steady quarterly sales growth. Target expects net sales to rise about 2% this fiscal year.
Food remains Target’s biggest traffic driver. The company will expand grocery space in remodeled and new stores, doubling fresh food sections in many locations. It also plans to introduce up to 50% more new items in snacks and dry groceries. Executives said better in-stock levels will remain a priority as competition intensifies from rivals such as Walmart, Amazon and Aldi.
In beauty, Target will replace its in-store partnership with Ulta Beauty by launching “Beauty Studio” in more than 600 stores and online this fall. The new concept will feature prestige brands, improved displays and a loyalty program.
The company is also reshaping its “Fun101” section, focusing on toys, pop culture items, sports merchandise, and gadgets, while reducing emphasis on TVs and laptops.
Home goods, one of the weakest areas, will see a major refresh starting in June. It will redesign 75% of the decorative items. The company will also move apparel faster with an AI tool called Trend Brain. In addition, Target will expand partnerships and roll out more Levi’s products.
Investors reacted positively, pushing Target shares higher as the company pushes forward with its turnaround.