Target rolling out organic, natural grocery brand

  • Article by: MIKE HUGHLETT , Star Tribune
  • Updated: June 8, 2013 - 7:05 AM

Called Simply Balanced, the No. 2 U.S. retailer’s latest store brand is a response to the growing popularity of organic foods.

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This undated photo provided by Target Corp., shows a new organic and natural store brand called Simply Balanced.

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Target Corp. will roll out a new private label, Simply Balanced, aimed at the rapidly growing organic and natural foods market.

The new brand, due in Target stores Sunday, will cover 250 products, including pasta, beverages, snacks, frozen seafood, dairy items and cereal. Simply Balanced products will be free of artificial colors, flavors and preservatives, the company said, and about 40 percent will be USDA-certified organic products, including milk, eggs, vegetables, juice and soups.

In a statement, Minneapolis-based Target said the Simply Balanced brand is an “important step” toward its goal of increasing organic offerings by 25 percent by the end of its 2017 fiscal year.

Simply Balanced joins Target’s existing store brands, which include Archer Farms and Market Pantry. The new brand is a response to the popularity of organic foods, sales of which are growing at twice the rate of conventional groceries, said Amanda Irish, Target’s senior director for store brands.

Target’s entering a crowded field, though. “A lot of chains have their own [natural and organic] brands,” said David Livingston, a Wisconsin-based supermarket consultant.

Eden Prairie-based Supervalu Inc., owner of Cub Foods, launched Wild Harvest Organics in 2008, and today the brand covers over 320 products, of which 230 are organic. Rainbow Foods, Lunds and Byerly’s for several years have also offered private-label natural and organic foods.

Whole Foods effectively pioneered the market a decade ago with its 365 Everyday Value brand. “The brand that most folks want to emulate is 365,” said Jon Hauptman, a partner at Chicago-based supermarket consultant Willard Bishop.

Private label products of all types typically cost less than branded goods; the discount can be 25 percent. “Private labels are extremely important” for food retailers, Hauptman said. Not only do they offer consumers a lower-priced alternative, they tend to carry higher profit margins for retailers than branded products, he said.

Plus, a robust private label program will attract customers. “A way for chains to differentiate themselves from their competition is to have a better private label selection,” Livingston said.

Target said that more than three-quarters of its Simply Balanced line will be free of ingredients made from genetically modified organisms (GMOs). Many food crops — corn, soybeans and sugar beets — are grown from GMO seeds. Target aims to eliminate all GMO-based ingredients from Simply Balanced products by the end of 2014.

 

The Associated Press contributed to this report.

Mike Hughlett • 612-673-7003

 

 

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