Target Sharpens Edge with Designer Fringe

In a bid to further distance itself from rivals, Target Corp is stepping up its partnerships with designers to lure shoppers from other retailers, and capture higher profits. What started in 1999 as a quirky line of housewares by architect Michael Graves is quickly becoming a stable of designer-related products, ranging from makeup and trendy clothes to home furnishings and camping goods. "This provides Target a clear point of differentiation," says Solomon Smith Barney analyst Richard Church.

Taking advantage of a weak economy and Kmart's recent bankruptcy-protection filing, the Minneapolis-based retailer's strategy seems like a smart bet so far. A Target spokeswoman says: "We're always looking for designers that will wow the masses."

Moderator Comment: A couple of days ago, Wal-Mart's plans to target a more upscale customer was met with mixed though mostly positive reactions from members taking part in the RetailWire discussion (King of the Working Class Sets Sights on Loftier Patrons).

Today, Target demonstrates why it has been able to carve out a sizeable niche (oxymoron, yes?) for itself. Management understands what makes it unique and it builds on that. The company's department store roots should also be credited with giving Target a perspective its mass rivals do not have. [George Anderson - Moderator]

• Target's Aim: The Designer's Edge