TARGET BREAKS FROM DOLLAR CONCEPT

WENDY TOTH / Additional reporting: Dan Alaimo

MINNEAPOLIS - Target Corp. here changed the format of its dollar-for-all section last month.

Formerly, the concept in Target's front-of-store value section, called "The 1 Spot," consisted of dollar products in a seasonal-style area near the store entrances.

The sections are now signed, "See. Spot. Save." with an image of the dog the company often uses in advertising and promotional materials.

While the sections still have products for $1, about 25% will now be items selling at two for $5, according to Internet postings on the SlaveToTarget.com blog. Among the items SN found selling at two for $5 in a recent store visit were a screwdriver set, a hammer, a drill bit set and a combination flip-flop and pedicure set.

The change had more to do with Target's need to update the two-year-old concept than inflationary pressures on dollar merchandise, according to industry sources.

Target did not respond to calls from SN. The move was apparently confirmed by a Target guest relations representative, whose email was posted on the blog. "Starting July 16, 2006, all Target stores will feature a section, near the carts, called See. Spot. Save., which will replace The 1 Spot," according to the email.

"Primarily, Target has made a stronger link between its current media and advertising, and its value section," said Jim Wisner, president, Wisner Marketing Group, Libertyville, Ill.

This section presents a stronger connection to Target's image as well as a new way to sell, he said. "Unlike many dollar stores that often cater to larger, lower-income families, Target has many stores in upscale neighborhoods. This is a way of expanding the opportunity for those families to 'treasure hunt.'"

The new approach adds a level of shopping engagement, Robert Passikoff, president, Brand Keys, New York, told SN. "Stores tend to remain fallow in terms of how they are organized and Target is looking to shake things up."

While Target may have felt it exhausted what could be offered as dollar items, this is not likely a direct result of inflation, Wisner said. "It is, however, a reflection of inflation over a long period of time," he said.