Consumerist reports that Target is having trouble in the grocery department. Despite the fact that Target sells around $18.5 billion in groceries a year, that's only around one-fifth of the company’s total annual revenue. Meanwhile, more than half of Walmart’s yearly revenue comes from groceries.
The Wall Street Journal recently took a look at Target’s fresh food woes and its efforts to course correct. The biggest reason for the grocery sales slump seems to be because shoppers just don't visit that frequently. Meaning: while Target has many regular shoppers, they may not be regular enough to keep fresh meat and vegetables from spoiling.One Target customer explains to the Journal that she shops at the store once or twice a month to purchase things like cleaning supplies and home décor, and she may pick up an odd food item here or there, but adds that “I don’t go out of my way to do grocery shopping at Target because there are so many other specialty stores.”
Data from Nielsen shows that shoppers favor traditional groceries over big box retailers regardless of whether they are buying a week’s worth of groceries or just doing some quick shopping to fill in the gaps. Meanwhile, it appears that Costco and other wholesale clubs are increasingly becoming a destination for shoppers looking to stock up their pantry, fridge, and freezer with food.
In 2015, Target’s chief operating officer acknowledged this outsider status: “We’re not really special and we’re not a full grocery. And so we’re sitting in the middle of no man’s land.”