Target bets on beauty makeover as Ulta exit looms

Target has been trying to screen up years of uneven performance, overmuch similar a rushed constitution regular that conceals flaws without afloat addressing what lies beneath.

Sales declines, shrinking ft traffic, and lost market share to competitors person weighed connected the retailer, compounded by consumer backlash over a bid of arguable concern decisions.

Those pressures intensified aft Target revealed that its five-year concern with Ulta Beauty volition extremity successful August 2026. With that exit approaching, the institution is moving with what it calls a renowned consciousness of "urgency" to capable the quality spread and reenforce its presumption arsenic a one-stop buying destination.

Target precocious unveiled a multi-year strategy aimed astatine returning to profitable maturation and generating much than $15 cardinal successful further income by 2030. The program centers connected prioritizing product "newness," expanding assortment based connected lawsuit needs, delivering value, and enhancing the buying experiences crossed stores and integer channels.

"Target volition proceed to curate a differentiated quality assortment and caller acquisition for its tens of millions of play shoppers, featuring a compelling lineup of essentials and unexpected finds, engaging merchandise proceedings events, and a committedness to affordable prices," it said successful a property release.

Now, the retailer is opening to enactment that committedness into action.

Starting successful February, Target (TGT) volition present astir 3,000 caller quality products and much than 60 caller brands, with implicit 90% of items priced under $20. The expanded assortment spans tegument care, makeup, and hairsbreadth attraction and includes a premix of popular, prestige, and Target-exclusive offerings.

The motorboat marks the retailer's largest-ever outpouring quality enlargement to date, disposable some successful stores nationwide and online. Store refreshes and in-store quality events, designed to promote find and engagement, volition enactment the strategy.

"Beauty is incredibly important and profoundly idiosyncratic to our guests, truthful our squad has worked with quality powerhouses and small, innovative, emerging brands alike to bring thousands of caller products to the mix," said Target Senior VP of Merchandising, Essentials and Beauty Amanda Nusz successful a property release.

"We ended up with a outpouring quality lineup that reflects what guests are looking for close present — breathtaking caller discoveries, Target‑only exclusives, and prices that consciousness good. And we've freshened up the in‑store experience, too, truthful uncovering a caller favourite feels casual and enjoyable."

• Clearer layouts: Designed to spotlight caller and trending products

• Updated displays: Aimed astatine inspiring exploration and interaction

• Increased visibility for Target exclusives: Help guests store bestsellers and caller products with confidence

• Refreshed hairsbreadth attraction aisle: The category's biggest translation successful years, organized astir hairsbreadth textures, routines, and circumstantial needs

Customers tin store the caller quality assortment successful stores, online, or done the Target app, with fulfillment options including Same Day Delivery, Drive Up, and Order Pickup.

Details connected participating stores and quality activations are available on Target's website nether the Events tab.

Target expands its 2026 outpouring quality assortment.Shutterstock · Shutterstock

As Michael Fiddelke steps into the CEO role, helium aims to code Target's recent challenges by delivering stylish, affordable products, enhanced technology, and a much accordant impermanent experience, each successful an effort to instrumentality to the company's roots.

To execute this goal, Target's squad has traveled globally for inspiration and is using AI-powered tools, including Target Trend Brain, to place emerging trends and assistance plan caller merchandise, according to a CNBC interview with Fiddelke.

The institution tested elements of this attack during the vacation season, which typically accounts for astir one-third of its yearly sales. In the 4th quarter, Target introduced 20,000 caller items, treble the fig offered the erstwhile year, according to a press release.

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Despite these initiatives, Target expects full-year 2025 income to diminution successful the debased azygous digits, according to its latest net report.

In the 3rd 4th of 2025, nett income fell 1.5% twelvemonth implicit year, portion comparable income dropped 2.7%, driven by little postulation and smaller mean transaction size.

"Our concern has not been performing up to its imaginable implicit the past fewer years, and I americium singularly focused connected supporting Michael and the full enactment squad arsenic they marque changes to the mode we work, enhancing our merchandising authority, our retail experience, and investing successful exertion to accelerate our business," said Former Target CEO Brian Cornell successful the company's 3rd 4th of 2025 earnings call.

"The squad is moving rapidly to get the institution backmost to profitable growth. And portion we're not determination yet, I'm assured we're connected the close path."

However, determination were immoderate agleam spots. Target's Beauty, Food & Beverage, and Hardlines categories each posted growth, helping explicate wherefore the retailer is concentrating its enlargement efforts successful those areas.

The U.S. quality and idiosyncratic attraction manufacture was valued astatine astir $102.73 cardinal successful 2024 and is expected to turn astatine a 7.1% yearly complaint done 2030, according to Grand View Research.

Consumer preferences are besides shifting. Only 14% of U.S. quality shoppers judge higher prices bespeak a better-quality product, according to a 2025 Circana study. While the wide quality marketplace grew 2%, income astatine wide merchants accrued 4%.

"The quality industry's latest results are indicative of a user who is focused connected efficacy and elevated value," said Circana Global Beauty Industry Advisor Larissa Jensen.

"The wide and prestige markets are converging, with premium-priced brands successful wide retail and value-priced prestige brands outperforming their counterparts. As the manufacture faces tariff uncertainties and shifting user sentiment, adaptability and strategical agility are indispensable for occurrence successful 2025."

McKinsey & Company analysts echo that view, noting that ostentation and accrued entree to accusation person pushed shoppers to wage person attraction to whether products present connected their promises.

"Consumers are selectively splurging crossed not lone user discretionary categories but besides quality subcategories," said McKinsey & Company analysts. "This suggests that consumers ascribe worth to quality products otherwise depending connected the product."

While a afloat turnaround whitethorn instrumentality time, immoderate manufacture experts spot aboriginal signs of stabilization.

"We are seeing the aboriginal stages of recovery, but it's going to beryllium a agelong 12-month haul earlier we spot a afloat bounce backmost of the 'Tarzhay' we each cognize and love," said RepTrak Chief Reputation and Strategy Officer Stephen Hahn-Griffiths to Forbes. "It's conscionable going to instrumentality immoderate clip to retrieve from those caller misdemeanors."

Others judge Target's renewed absorption connected plan and trends could assistance reverse its income slump.

"By reimagining plan arsenic a strategical attack to code a wide scope of user and stakeholder needs, Target offers executives a almighty exemplary for transforming evident dilemmas into the catalysts for innovation," said Yale Program connected Stakeholder Innovation and Management Practice Leader Jon Iwata.

Rezolve AI Chief Growth Officer Roland Gossage, a retail seasoned with much than 20 years of experience, cautions that novelty unsocial won't beryllium capable and that strategies indispensable beryllium driven by beardown fundamentals.

"Target volition request to spell beyond the novelty of these in-store experiences and guarantee that astatine the extremity of the day, they're delivering connected these cardinal factors of a bully retail acquisition first," said Gossage to The Street. "That extends to online and mobile buying arsenic well."

Related: Amazon CEO warns shoppers of large changes ahead

This communicative was primitively published by TheStreet connected Feb 5, 2026, wherever it archetypal appeared successful the Retail section. Add TheStreet arsenic a Preferred Source by clicking here.