Target launching "dealworthy" brand with focus on basics
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Target's new brand includes includes nearly 400 products, starting at less than $1 and with most items under $10. Photo: Courtesy of Target
Target is focusing on the basics and low prices for its new store-owned brand "dealworthy," a line of everyday essentials arriving in stores this month.
Why it matters: More Americans have been turning to store brands to save money as they continue to deal with sticker shock over high prices.
What's happening: Target is introducing the first products in the new value brand and will add additional products through early 2025.
- The line will have nearly 400 items spanning four categories: apparel and accessories, essentials and beauty, electronics and home. Products include toilet paper, phone cases, shirts and other basics.
- Prices start at less than $1 and most items will be under $10, Rick Gomez, the company's chief food, essentials and beauty officer, told Axios.
- "In each category they will be the lowest-priced item at the shelf," Gomez said.
The big picture: Store brands are big business for Target and generate $30 billion in sales annually, said Gomez, an executive vice president with the Minneapolis-based retailer.
- "Our owned brand business is really critical to driving differentiation for Target, but also driving traffic and ultimately growth for the business," Gomez told Axios.
- Sales of store-owned brand products globally grew 4.7% in 2023 to $236.3 billion while national brands grew 3.4% year-over-year, according to the Private Label Manufacturers Association.
What they're saying: Consumers have been telling Target they need affordable options, Gomez said.
- They're looking to stretch their budget, they're looking to manage through inflation, and they're looking for value," Gomez said.
Meanwhile, Target also announced this week that it is expanding its 15-year-old up&up brand to reformulate products and add additional items.
Of note: Target's store-owned brands come with a one-year return policy or money-back guarantee compared to the 90-day return period for most items.
- GlobalData managing director Neil Saunders told Axios that Target's guarantee is "very generous and designed to create confidence in their products."
- "It is also a point of differentiation for their own brands over national brands," Saunders said.
Our thought bubble: It's extremely rare for a retailer to offer a separate return policy for store-branded products and a year-long return period is beyond the normal 30 to 90 days most stores offer.
- Discount grocer Aldi is one exception with a "Twice as Nice" guarantee on its exclusive food items.
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