Dive Brief:
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Over the last year, Target has taken its private label strategy to a new level, launching about a dozen home goods and apparel brands. On Wednesday, the mass merchant launched its latest: Made By Design.
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The brand is made up of over 750 basics like towels, cooking utensils, glassware, plates, pots, closet organizers and more. Prices range from $1 to $260, but most items are under $30. The line will be available in all Target stores and online beginning on June 23, according to a company blog post.
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"Made By Design is the ultimate expression of our DNA — a commitment to the democratization of impeccable design," Mark Tritton, EVP and chief merchandising officer at Target, said in the blog post.
Dive Insight:
Private label has been a major part of Target's effort to modernize. Not only do more design-focused in-house lines help freshen up its "cheap chic" reputation, but the perception of constant newness at an affordable price is giving shoppers more reason to shop exclusively at Target, and not on Amazon.
A focus on home and essentials to differentiate is fitting too. Comparable sales grew 3% in the first quarter of the year thanks to strength in home, household essentials, and food and beverage. Traffic was also up 3.7% — the strongest the company has seen in 10 years. The home category has been a homerun when it comes to Target's same-day delivery service in dense urban areas like New York, Chicago, Boston and other cities. The category accounted for more than half of those sales dollars, according to a Seeking Alpha transcript of the company's Q1 earnings call.
Opalhouse, an art-inspired "eclectic" home brand launched in February, has already shown positive results, executives said on the call. Other relatively new brands like Threshold, Project 62, and Hearth and Hand with Magnolia have also performed well.
A focus on private label is only one of several things that have boosted Target's performance after a string of disappointing quarterly earnings reports dating back to 2015. The company was also named Retail Dive's Turnaround of the Year, thanks to its $7 billion investment in stores and revamped digital strategy.
