Target Kicks Off Aggressive Marketing of New Brands

Target is going private. Not that kind of private -- it's adding a host of private brands that will receive an ad barrage. The Minneapolis-based retailer last month debuted its new in-house womenswear label, A New Day, composed of versatile prints and patterns in modern aesthetics. But New Day is only part of the $69.5 billion chain's aggressive strategy to return to growth by producing a dozen new private brands, the first of which are just now hitting stores. "This is just the beginning of a long series of new, owned brands launching that will really differentiate and set Target apart in the marketplace," says Rick Gomez, who was elevated to chief marketing officer of Target in January. Along with the new women's line, Target also is introducing Goodfellow & Co., its first menswear collection; Project 62, a home line embracing the trendy mid-century modern design, which will begin selling this month; and JoyLab, a women's fashion performance brand that will launch in October. To spread the word, Target is airing "More in Store," an overarching brand marketing campaign that pushes the new labels, as well as its one-year-old kids' brand Cat & Jack. Time for a turnaround The plan has a lot riding on it. Like its competitors, Target has been struggling to compete in a digital age as Amazon gains ground on the very "everyday essentials," including food and basics, that up until recently had been the brick-and-mortar chain's bread and butter. Last year, Target's sales fell 6% to $69.5 billion; same-store sales fell 0.5%, driven by a 1.5% in the fourth-quarter holiday period. Yet as new generations, including the all-important millennial shopper, place less value on the brands their parents swore by—51% of the group have no real preference between private-label and national brands, according to a recent study by Cadent Consulting Group—there's an opportunity for retailers like Target to take more products in-house. The 1,800-unit company has already proven the formula works with Cat & Jack, which launched last year and has roughly $2.2 billion in sales. And consumers are interested—the announcement that the company was planning 12 new brands generated nearly 900 million earned media impressions, which compares with the 750 million impressions generated by Target's Victoria Beckham collaboration, one of its most popular designer partnerships, according to a spokesman. "Target is a strong merchant who has demonstrated an ability to creatively innovate and differentiate their products," wrote Oliver Chen, a retail analyst at Cowen and Co. in a recent research note. "We're impressed by the performance of [Target's] kid's brand Cat & Jack, which grossed $2 billion within the first year since launched, outperforming both management's and our expectations. This strong execution gives us confidence [Target] will be able to successfully launch 12 brands across signature categories through end of [fiscal 2018]." New, all-inclusive marketing ahead To support the new offerings, Target will air its first campaign spot this Sunday. The effort, which was created with Mother, Target Creative and Team Arrow, will include print, digital, TV, including some Spanish-language spots, and visual merchandising in stores for each new brand. Target will also host in-store events throughout September. New commercials are clean and simple, with background music as a nod to Target's playful advertising heritage, and feature a diverse range of ages, sizes and ethnicities in an effort to be more inclusive, executives say. Target recently updated its in-store mannequins to size 22. Gomez says he anticipates the campaign to result in more than 1.5 billion paid media impressions. "This is our second biggest investment behind holiday," he says. "We're investing at leadership levels." Last year, Target spent $570.7 million on measured media in the U.S., a 9% decline over 2015, according to Ad Age's Datacenter. Online, the new brands will have more robust digital enhancements, including 360-degree video views of products, individual brand landing pages, and user-generated social content. Chief Creative Officer Todd Waterbury and his team of 350 at Target Creative were involved with each brand's development, including each label's name, from the beginning, late last year. Project 62 is named after Target's first store opening in 1962, for example. "It's a very aggressive timeline to start with a blank sheet of paper," says Waterbury. "We want to completely reinvent the way we are developing brands and marketing those brands."

Target Kicks Off Aggressive Marketing of New Brands

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