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Target To Re-Brand Home Label

May 22, 2012
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Minneapolis, Minn.-based Target announced last week that it would be re-branding its Target Home brand, the largest private label brand in its portfolio, as Threshold beginning this fall.


Private label products are worth more than $1 billion a year to its bottom line, CEO Gregg Steinhafel told analysts in the company’s second-quarter earnings conference call last week. Private label clearly has been making inroads for the retailer, its executives said in the call.


“I would say owned brands overall have been strong really across the board,” said Kathee Tesija, Target’s executive vice president of merchandising. “Our consumables and commodity categories, as you know, continue to be very strong. All of our apparel owned brands have been performing quite well. In Home we’ve seen good results in room essentials, which we’ve talked about before, but also Smith and Hawken and some of our better brands.”


Steinhafel said that would keep Target focused on its private label strategy.


“We now have 10 owned brands or signature national brands that do over $1 billion in retail,” he said. “We continue to invest in our own brands. We treat them as national brands. We position them as such. And they’re a key part of our strategy.”


Tesija told analysts that Target saw an opportunity to “better clarify its positioning and point of view,” by the rebranding to Threshold. She said the plan was to follow the company’s change with room essentials.


“Everything was on the table in this effort – product, quality, packaging and positioning within our brand portfolio,” she said. “We believe this is an opportune time to rebrand Target Home, as the economy continues to improve and more guests are beginning to feel comfortable trading up from good to better brands.”


Tesija said the launch in the fall would begin with essentials, accents and decorative accessories before taking the brand across its entire home assortment in 2013.


“In terms of the gross margin, certainly mix helped us … with apparel. And as we grow apparel, that definitely is positive,” she said. “Owned brands is another one that’s positive that we continue to grow, and intend to for the future, which will help us.”

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