Target Seeks to Up its Grocery Game

Though Minneapolis-based Target has spent years trying to become a major player in grocery, it remains a secondary stop for many shoppers. That’s the conclusion of a recent in-depth article that ran in the brand’s hometown paper, The Minnesota Star Tribune. (Though that article devoted considerable space to looking at Target’s grocery strategy for its hometown, it also included information on the brand’s chain-wide challenges in that sector.)

Groceries account for just over 20% of Target’s sales, compared with more than half at rival Walmart, and purchases are often incremental rather than part of a weekly stock-up.

At its investor day last month, Target acknowledged it needs to sharpen its grocery strategy as part of a broader effort to pull out of a sales slump that has lingered since the pandemic.

“Shopping for food at Target should feel distinctly Target,” said Cara Sylvester, Target’s Chief Merchant, at the retailer’s financial community meeting in March. “Delightful, joyful, unlike what you’ll find anywhere else.”

In Target’s preview of its revamped grocery strategy at that session, executives showed off displays featuring items labeled grain-free, gluten-free and high-protein.

The company is also earmarking a significant chunk of its $5 billion investment this year for grocery, expanding the section’s footprint in 130 remodeled stores and leaning into what executives describe as its strength in “style and design.”

While acknowledging the need to refine the strategy, Target executives note that food and beverage sales have grown from $15 billion in 2019 to $25 billion in 2025, driven in part by expanded health and wellness offerings.

Target’s overall challenge, said Amanda Lai, Director of Food Industry Practice at Chicago-based retail consultant McMillanDoolittle, is that it’s “not the cheapest,” but also not “the most differentiated or highest quality,” making it harder to compete with value-driven chains and upscale grocers.

Target, for its part, says it “is writing a new chapter focused on growth, with food and beverage as a foundation of this work,” a spokeswoman told the newspaper.