Will Good & Gather Bring Target the Food Sales It Wants?

Target's food sales represent just 20% of its total volume—and for Walmart, it's 50%. Good & Gather is Target’s latest attempt to increase its food sales. 

The Good & Gather brand began rolling out to Target stores Sept. 15. By the end of 2020, the brand will have more than 2,000 items, including organic pizza crusts, milk and eggs, hazelnut and peanut butter spreads, frozen veggies, salad mixes and pastas. Target said it expects Good & Gather will be a multibillion-dollar brand—and the largest of its private labels. Good & Gather will be Target’s new flagship brand but will be broken down into different categories: kids, organic, seasonal and signature. All Good & Gather products will be made without artificial flavors and sweeteners, synthetic colors and high fructose corn syrup, following the lead of many other grocers, including Aldi.

“We’ve been hard at work [on this] for the last couple years,” Stephanie Lundquist, head of food and beverage for Target, told CNBC. “Food and beverage play such an important role for Target’s business ... for the Target experience.”

Today, according to a CNBC report, nearly 75% of Target shoppers in stores are adding at least one food item to their baskets, and when they do, their basket sizes are two times larger.

People don’t often seek out Target as a destination for all of their groceries, as they might at Walmart. One possible reason is their award-winning advertising decades ago that promoted the store as hip and loaded with trendy clothing and housewares.

Target’s grocery business has had seven consecutive quarters of positive same-store sales growth, with six quarters of market share gains. In 2018, Target’s sales grew to $75.36 billion from $71.88 billion in 2017. Analysts are calling for sales of $77.44 billion in fiscal 2019, according to FactSet.