uploads///TGT Brands

Will Target’s Focus on ‘Only-at-Target’ Brands Drive Sales?


Jan. 9 2018, Updated 11:28 a.m. ET

Target launches Universal Thread

Building on its strong list of exclusive brands, Target (TGT) announced the launch of Universal Thread, a women-centric denim-based lifestyle brand. Slated to hit Target’s stores and online platform in early February, Universal Thread offers value to customers, as the prices for this exclusive brand will range from $5.00 to $39.99, an average of 10.0% below Target’s current offerings. Universal Thread will be launched in sizes from 00 to 26W.

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Why it matters

Amid much e-commerce hype, one area that has been silently driving Target’s sales is its focus on differentiated offerings through the launch of exclusive “only-at-Target” brands. Not only do these brands strengthen the company’s portfolio but they also generate immediate strong sales as reflected by the stellar performance of kids clothing line Cat & Jack, which generated more than $2 billion in sales within one year of its launch.

Besides Cat & Jack, the company’s other exclusive brands including Pillowfort, Isabelle, Cloud Island, A New Day, Goodfellow, Project 62, and JoyLab continue to resonate well with customers and are generating stellar sales growth.

Notably, during the last reported quarter, sales in the company’s Home category showed improvement on a YoY (year-over-year) basis thanks to the launch of the Project 62 brand. Target’s apparel and accessories category remained low amid growing competition from Amazon (AMZN) and other retailers and unfavorable weather, but the company’s newly launched brands including Goodfellow for men, A New Day for women, and JoyLab in the women’s activewear category saw strong sales. Also, the company’s Hearth & Hand, a new home and lifestyle brand launched in partnership with Magnolia, started off on a strong note.

Earlier the company stated that it would add 12 new “only-at-Target” brands by fiscal 2018. In comparison, rival Walmart (WMT) is also focusing on enhancing its exclusive list of brands, as the exclusivity associated with them attracts customers.

Continue to the next part where we’ll discuss Walmart’s merchandising strategy.


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