Dive Brief:

• Target has added a premium line to its recently launched Good & Gather private label brand, according to a press release.
• Good & Gather Signature launched with 60 products, including small-batch Italian sauces, gourmet pizzas and specialty sauces that cost anywhere between $3 and $10, according to CNBC.
• Target is also adding hundreds of additional Good & Gather products, including hummus, meatless patties and coffee, which will bring the total assortment to almost 2,000 products by the fall and make it the grocer's largest in-house brand by assortment.

Dive Insight:

With its new premium line, Target is serving unique products and inspiration to the surge in people that are cooking at home now more than ever due to the coronavirus, Stephanie Lundquist, Target’s president of food and beverage told CNBC. These shoppers are also looking for value, which attracts them to private label products versus the national brand. 

Target’s main Good & Gather line debuted about a year ago and reached $1 billion in sales during the second quarter. The company launched the brand as an effort to improve its grocery sector and compete with retailers like Walmart and Kroger.

In the second quarter, Target saw profits rise 80%, a key factor being e-commerce. Its food and beverage sales grew by 20% year-over-year, and comparable sales of Target’s brands jumped 30%. As of now, food and beverage makes up a total of 20% of the retailer’s business. 

Private label sales specifically help Target maintain a loyal customer base, bring in higher margins and offer more control over product R&D. For example, its Good & Gather recipes are free from ingredients some shoppers may want to avoid, like artificial sweeteners and flavors, high-fructose corn syrup and synthetic colors. 

Good & Gather will be the grocer’s main private label grocery brand. It is phasing out two of its other brands, Archer Farms and Simply Balanced, and will slim down its Market Pantry offerings. 

To further improve its grocery offerings, Target announced in June it will add fresh and frozen items to its same-day order pickup and drive-up services nationwide. Grocery click-and-collect service is now available at more than 1,500 Target stores.