Market Strategy

Nicole Maestri, “Target Ditches Bull’s-eye for ‘Up and Up’ Arrow,” Reuters.com, May 19, 2009.

One of the most recognizable logos around is Target’s bull’s-eye, which has appeared on the company’s advertising for years. Yet Target is now saying bye-bye to the bull’s-eye as it reinvents its private-label merchandise.

Private-label merchandise has become the new “chic” for savvy shoppers. Especially in the current climate, consumers are likely to trade down to private labels to save money. Retailers are perfectly happy to have them do so, because their margins generally are higher on private-label products.

Target’s new private-label merchandise features a big, colorful arrow on a white background with the words “up & up” on the package. The “up & up” refers to the quality of the merchandise, as well as the uplifting appeal of the label in the dismal economy. Up & up also may counteract, even if subconsciously, the perception that customers are “trading down” to save money on the private-label version. Target’s up & up brand sells for 30 percent less than national brand options.

The private labels at Target have already enjoyed success, with 25 percent compound annual growth during the past five years. It plans to expand its current stable of 730 private-label products to 800 by the end of 2009 by adding baby food and laundry detergent offerings.

Target is confident that the new packaging will encourage new shoppers to try the brand. It also should stand out on the shelf, whereas the bull’s-eye was so familiar and pervasive that it may have started to blend in on shelves.