Dive Brief:
- Target plans to reduce its regular prices on over 2,000 items across its owned and national brand assortment this holiday season, the company said Tuesday. The price cuts are on holiday gifts, toys, board games, health and beauty products, snacks, beverages and grocery items.
- The company previously announced a round of price cuts on 5,000 items in May. Target said Tuesday it surpassed that goal by lowering prices on over 8,000 items this year to date. By the end of the holiday season, Target says it will have cut prices on over 10,000 items.
- The lower prices will be reflected online, in Target’s app and in-store with red tags, a company spokesperson said. However, stores in Alaska and Hawaii are not participating in this pricing promotion.
Dive Insight:
In its second quarter report in August, Target said consumers reacted positively to May’s wave of 5,000 price cuts and same day services also helped push the retailer to growth for the quarter.
“Consumers remain very price sensitive and many retailers are responding to that by cutting prices,” Neil Saunders, managing director of GlobalData, said in emailed comments to Retail Dive. “In some ways, this is a critical way to drive volume and retain market share. Target is doing its bit here as it wants to emphasize its value position over the holidays.”
Target wasn’t the only retailer to do large scale price cuts across its discretionary and essentials assortment this year. In August, Walmart said it cut prices on over 7,200 items across categories. Last month, Party City said it was lowering prices on 2,000 items. And earlier this summer, crafts retailers Joann and Michaels made similar moves.
Along with the lower prices, Target also touted several other recently announced promotions and initiatives, including what it said was its largest holiday assortment ever with “thousands of items” available for $5 and $10.
In the lead up to the holiday season, consumer research and data company Circana said Tuesday that sales are holding at a relatively steady pace for many retail sectors, including prestige beauty, home, auto and office supplies. That momentum is likely to continue. Technology sales appear to be stabilizing and the gap is closing in toy industry growth. Additionally, deep declines continue in fashion categories, positioning this holiday season to meet pent-up demand in apparel, footwear, and accessories, Circana said.
“Consumers continue to demonstrate their resilience, both in their willingness to spend when the value is there and their ability to adapt in order to maximize that value,” Marshal Cohen, chief retail industry advisor for Circana, said in a Tuesday statement. “There is consumer optimism ahead of the holiday shopping season, but more is needed to fuel retail growth.”
Some of the latest price reductions Target highlighted include a Lego Technic 2022 Ford GT Car Model Set now for $95.99, down from $119.99; a Bluey Fire Truck for $19.99, down from $24.99 and a Magic Bullet personal blender set for $39.99, down from $49.99.
