Target's 10th Company-Owned Brand Hits $1B Revenue Milestone

Department store Target Corporation TGT now owns 10 brands that generated at least $1 billion in sales last year after the company said Monday morning that its new All in Motion brand reached the milestone.

What Happened: Target's All in Motion brand was launched around a year ago and was well-positioned to address a shift in clothing demand amid the COVID-19 pandemic.

The shift to work-from-home and stay-at-home meant consumers opted for more casual and comfortable clothing items.

"We like to joke about this internally that it's become our guests' favorite work wear, not just workout wear," Jill Sando, Target's chief merchandising officer for style and owned brands, told CNBC.

Target's workout brand is much cheaper than its rivals, as most clothes and accessories items cost less than $30. In contrast, a pair of workout pants from Lululemon Athletica Inc LULU can come in near $100.

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Why It's Important: Target's strategy of focusing on its own brands as a differentiating factor appears to be paying off. In fact, the company continues to double down on its successful strategy, as it has four brands that generate more than $2 billion in sales.

Over the past five years, Target launched more than 30 of its own brands across key categories like clothing and home. 

What's Next: Target is aiming to outsell higher-end apparel and athleisure brands, Sando told CNBC. To achieve this objective, management won't change its formula of focusing on quality, style and more inclusive sizing at a lower price.

Some analysts remain bullish on Target's strategy of standing out in the competitive landscape by giving consumers a reason to shop at its stores.

"The one-stop shopping trend continues because what the customer has learned is that they don't need to go to six different places," SW Retail Advisors' retail consultant Stacey Widlitz told CNBC. "And they no longer want to go to six different places."

TGT Price Action: Target shares were trading 1.74% higher at $192.23 at last check Monday. 

Photo courtesy of All in Motion.