Target’s renewed private-label push fails to stem market share drop

Customers wait on a long check out line at a Target store in San Francisco on Saturday, June 15, 2019.“Target is my backup option,” said Chloe Guss, a shopper at the retail chain for nearly 20 years whose reservations about some of its products may spell trouble for the business.) through her Instacart app for a few groceries and mainly diapers and formula for her children. But for clothing and furniture, Guss says she seeks out better quality elsewhere.

However, its total U.S. retail market share, including online and store sales, has shrunk in categories that generate over 60% of its revenue, data from market research firm GlobalData shows. Target lost share in food and household goods, clothing, electronics, home wares and furniture in the first quarter, gaining only in beauty products.

While major rivals said first-quarter sales rose from growing market share, Target posted weaker comparable sales for the quarter ended May 4, its fourth straight drop. Target cited macroeconomic factors such as delayed purchases and increased spending on activities outside the home, without mentioning market share losses.

Costco’s Kirkland Signature brand has grown more popular, with significantly more households choosing it in early 2024, Numerator said. Costco on an earnings call noted market share gains in big ticket items like electronics and furniture. Target’s Good & Gather food and Up & Up household essentials brands, which compete with Kirkland Signature by Costco, lost household penetration share in the first calendar quarter, Numerator’s data showed.To fight back, Target in January launched its ‘dealworthy’ brand with nearly 400 items including iPhone chargers and toiletries below $10.

Some shareholders are optimistic that Target will recover through its private-label expansion and price cuts.

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