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A child holds a Walt Disney Co. Pixar Cars branded toy at a Target Corp store. in Chicago.
Daniel Acker | Bloomberg | Getty Images
Target said on Monday it would roughly triple the number of Disney stores in its stores, helping to increase foot traffic as the holiday season approaches.
The national retailer, which has approximately 1,900 stores in the United States, began opening Disney stores in select locations in 2019. With the expansion, more than 160 Target stores will sell Disney-themed merchandise, from toys to costumes, by the end of the year.
In a way, Target’s partnerships turn its stores into mini-malls where shoppers can easily browse a variety of products under one roof. Buyers can get a shot or fill a prescription at a scaled-down CVS Health. They can order a Frappuccino at a Starbucks coffee shop. They can find displays dedicated to Apple gadgets and Levi Strauss denim. And they can try a lipstick swatch or get beauty tips at Ulta Beauty mini-shops, which started opening in select stores earlier this month.
The retailer’s Disney store expansion precedes the holiday season, a key time for toy sales. Macy’s recently announced that it will also expand its toy offering. It has entered into a deal with Toys R Us to open stores in more than 400 department store chain stores and online. A larger assortment of Toys R Us products is now available on Macy’s website.
Steve Dennis, retail strategy analyst, said the Toys R Us shutdown “has put market share up and many retailers are looking to reclaim it.” This has led to increased competition between retailers like Walmart, Amazon, and Target – and turned toys into an attractive merchandise category for Macy’s.
He said Disney stores could help Target stand out and increase the price of its toy department.
“One of the trends that I think they’re looking at is ‘How do you create more uniqueness and differentiation for your brand’ and sort of elevate it from the typical type of merchandising?” he said. “What is that extra reason to go to the store or the website or maybe buy something else on your trip?” “
Toys have been a growth category for Target and continued to show momentum in its second quarter, which ended on July 31, according to Christina Hennington, director of growth. She said on the company’s earnings call that toy sales rose in the low 20% year-over-year range over the three-month period.
In Target’s Disney mini-stores and on its website, shoppers will be able to find items from popular Disney properties, including Star Wars and “Raya and the Last Dragon.”
Along with Disney, Target has announced that it will partner with popular toy retailer FAO Schwarz for the second year in a row. It will have an exclusive 70-piece toy collection featuring FAO Schwarz, including items from Barbie and Paw Patrol. It will also have a pop-up store inside FAO Schwarz’s flagship store in New York.
Target shares have risen about 43% this year. The company exceeded earnings expectations last week as it got off to a good start to the back-to-school season.
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