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Target to Focus on Organic, Natural, Private Label

Target to Focus on Organic, Natural, Private Label

Target aims to attract more young shoppers by shifting its grocery focus and curating its products for today’s consumer. It recently revealed plans to concentrate more on its private label brands and items such as Greek yogurt and bagged coffee, and less on traditional packaged food brands. The new strategy includes sorting its food products into three categories: “signature,” “outperform” and “perform,” with items in the “perform” category featured less often in circulars and specials, reported The Wall Street Journal.

After much research, Target created its ideal category of shopper, called the “demanding enthusiast,” which is a younger, multicultural city-dweller. Target previously revealed its interest in the urban consumer with its TargetExpress concept, which was launched at the beginning of 2014. It’s a small format store that covers about 15% of the size of a typical Target store, and its offerings are based on research into what products customers in cities are looking for.

In April, Target also unveiled plans to reinvent its food offerings with a focus on six categories: better-for-you snacks, coffee and tea, premium sauces and oils, specialty candy, wine and craft beer, and yogurt and granola. It also plans expand its natural, organic, locally grown and gluten-free options. In order to implement these changes, it appointed Anne Dament to the role of Senior Vice President, Merchandising.

These plans are not a surprise as many traditional retailers are trying to win over young consumers and those looking for organic, natural, and specialty products. Kroger has been a major player in the organic category for a while, and in 2014 its organic sales topped $1 billion, and at that time it reported carrying 35,000 organic or natural products, according to Bloomberg. Walmart even moved into the sector when it began carrying Wild Oats organic items in 2014. Whole Foods Market is currently one of the most well-known stores for organic and specialty foods, but it has often been criticized for its exclusivity due to its high prices. It revealed plans for a small format store with “value prices” aimed at Millennials, possibly in response to the increased competition from other retailers.

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As more retailers enter the organic and natural foods market, will these specialty products become more popular and affordable, or will they become too mainstream and lose their appeal among younger consumers?

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