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Target Cuts Prices on Essentials Like Milk as Consumer Caution Continues

Target Cuts Prices on Essentials as Consumer Caution Continues

Target is reducing prices on essentials like milk and produce amid continued consumer caution.

The retailer plans to lower prices on roughly 5,000 “frequently shopped items,” including milk, meat, bread, produce, peanut butter, coffee, diapers, paper towels and pet food, according to a Monday (May 20) press release.

“We know consumers are feeling pressured to make the most of their budget, and Target is here to help them save more,” Rick Gomez, Target’s executive vice president and chief food, essentials and beauty officer, said in the release. “Our teams work hard to deliver great value every day, and these new lower prices across thousands of items will add up to additional big savings for the millions of consumers that shop Target each week for their everyday needs.”

These markdowns come within days of news that consumer prices are up while retail sales are flat, trends that indicate that shoppers are either buying less or perhaps trading down.

“Those shifts would dovetail with the PYMNTS Intelligence data that showed that coming into the first few months of 2024, consumers were opting for private-label brands, and more than two-thirds of paycheck-to-paycheck consumers who [said they were] already challenged paying their bills found themselves making tradeoffs between ‘essential’ items and those they deemed ‘nice-to-have,’” PYMNTS reported.

The data showed the impact inflation has had in many of the most essential categories. For example, housing is almost 24% more expensive than it was just before COVID-19 hit, while groceries cost 27% more than they did before the pandemic.

“That means there’s not all that much left over to afford items such as sporting equipment, apparel or entertainment, and each of those spending categories has been marked by double-digit price hikes through the same time frame,” PYMNTS wrote.

With consumers increasingly embracing private-label items, Target and rival Walmart have been expanding their offerings on that front.

For example, Christina Hennington, Target’s chief growth officer, said earlier this month that it is expanding sales of its in-house Cat & Jack children’s brand at department-store chain Hudson’s Bay Co. in Canada.

That followed February’s announcement that the retailer was reformulating 40% of the products for its Up&Up brand, which makes up about 10% of Target’s private-label stable.

In April, Walmart launched bettergoods, a “chef-inspired” food line that the company said is its largest private-brand food rollout in 20 years.

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