Target, the second-largest discount retailer in the United States, is renowned for acting like an innovative upscale boutique, with high quality products at low prices. This strategy had set them apart from others who focused solely on price, and now they had ambitious plans to grow their revenue from $50 billion to $150 billion.

They also had an unruly portfolio of over 240 brands – the result of merchants acting independently to create own-brands, in the absence of a strategic architecture. Consequently, while there was choice, own-brands weren’t driving loyalty. Customers were confused, with research showing only 32% could correctly attribute Target’s own-brands to the right company.

A framework for decision-making and innovation
We worked with Target’s senior management to define the essence of the master-brand and a set of principles to guide own-brands. We analysed the hundreds of existing labels, spending time with customers at stores and in their homes to get a deep understanding of shopping patterns.

We found a fragmented mass of products that lacked coherence, and recommended that Target manage fewer, bigger, better brands. We created a strategic framework that categorised brands based on their relationship to the master-brand, their role in customers’ lives, their in-store scalability, and their potential profitability.

“The consistent execution of our strategy helps us create the excitement Target guests expect and the shopping experience they love.”

Target 2006 Annual Report

Everyday optimism
We also gave Target a range of recommendations to simplify and upgrade own brands. For example in the consumables category, we conducted quantitative and qualitative analyses to understand the competitive landscape, consumer needs and Target’s unique advantages.

Our learnings led us to create a strategy around ‘Everyday Optimism’, which was about bringing a helpful, positive attitude to daily purchases. We brought this to life with the brand name ‘up & up’, supporting it with a vibrant identity across packaging design and in-store execution.

“The identity gives us the opportunity to deliver on both the ‘expect more’ and ‘pay less’ sides of our brand promise”

Mark Schindele, Senior VP Merchandising, Target
Up, up and away
‘Up & up’ now includes over 800 everyday essential products across more than 40 categories, including household, healthcare, beauty, baby, and personal care. Nearly 100 items were introduced for launch, including new categories such as cotton balls and swabs, laundry detergent and baby food.

Our work helped make Target one of the most valuable retail brands in the US. In 2009, the ‘up & up’ brand registered a 14% increase in comparable sales, and by July 2010, comparable sales were 21% higher than the previous year.