Target wants to revive ‘Tar-zhay.’ It just debuted a preview of that in New York

The Target Corp. flagship store. Photographer: Ben Brewer/Bloomberg (Ben Brewer/Bloomberg)

NEW YORK — Target hopes that a recapturing of its cultural cachet will spark a turnaround for its business. It’s turning to a fashion-forward New York neighborhood to get started.

The chain unveiled its first-ever concept store in SoHo this week, adorned with stylish apparel, designer collaborations, and beauty products — all key areas that its incoming CEO hopes will revive its former “Tar-zhay” glory.

Michael Fiddelke, Target’s current chief operating officer, is replacing longtime leader Brian Cornell as CEO in February. Following the August announcement, he immediately laid out his vision to recover Target’s image as being both affordable and trendy.

A focus on design is certainly evident at the location at 600 Broadway, which doesn’t look like a typical drably lit big-box store. Shoppers enter through Target’s trademark bullseye, which is adorned with red-colored shelves filled with new products, and then continue through a corridor to the redesigned beauty and makeup section.

“Michael has been really clear coming in that we are a design-led company and that means not just the products that we carry, but how we actually think through the decisions that drive our overall experience,” Cara Sylvester, Target’s chief guest experience officer, told CNN.

Target has been in a deep slump for years, largely due to its own strategic missteps. Sales began to falter in 2022 as post-pandemic shoppers pulled back spending, with the brand eventually losing customers to rivals like Walmart and Amazon.

Sylvester noted that Fiddelke has three clear priorities to aid in a turnaround: better merchandise, an elevated in-store experience with remodels and improved technology.

“What you’re seeing here is really the first two priorities come to life,” she said of the SoHo store.

Oliver Chen, a retail and luxury analyst for TD Cowen, said Target’s concept store can be a good showcase to help bring back that “Tar-zhay” luster.

“This can really help when Target’s trying to embrace new brands to be rolled out,” he told CNN, adding that people want to “love” the retailer again.

In transition

The turnaround efforts in SoHo could mean broader changes more than 1,000 miles away at Target’s headquarters in Minneapolis and at its more than 2,000 locations nationwide.

The retailer released another dismal earnings report in November, partially because consumers are cutting back on non-essential spending like home goods and fashion — key areas for Target. More than half of Target’s sales are discretionary.

It’s also reeling from a consumer boycott after it cut back its diversity, equality and inclusion efforts earlier this year. Target shares have lost a third of their value in 2025.

However, Joe Feldman, senior managing director at Telsey Advisory Group, said the brand has felt “off” since well before this year.

He traces Target’s loss of cultural appeal back to June 2023, when it found itself immersed in controversy after pulling Pride month merchandise at some of its stores.

“That’s part of why the business has not been as strong ever since then and they’ve had fits and starts, but generally speaking, their business hasn’t really recovered,” he told CNN.

Target also has more competition when it comes to trendy home goods and fashion sold at lower prices, Feldman said. That includes rivals like Walmart, but also Wayfair and off-price retailers like T.J. Maxx, HomeGoods, Marshall’s and Ross Dress for Less.

“Target was trying to fix the day-to-day issues facing them and lost track of the merchandising,” he said.

Feldman praised Target’s private-label kid clothing and denim selection. But although he’s seen minor improvements in fashion, there’s “still a lot of work to be done” with its home products.

Chen agreed that home goods is Target’s “biggest problem.” That’s due in part to the housing slowdown and because shoppers are pulling back spending on higher-priced items.

Stylish SoHo

When the Target SoHo location initially opened in 2022, it mostly focused on convenience store fare, like packaged foods and drug store items. There was only a small selection of home goods and fresh foods.

The refreshed store now showcases clothing in its Target-esque logo at the entrance. That was a missed opportunity for a neighborhood like SoHo, Sylvester said, flanked with flagships from New Balance, Aritizia and American Eagle.

The front will be freshened up with a new theme monthly, currently displaying affordable holiday gifts.

Another key area is a “Curated By” section, a monthly selection of Target offerings chosen by a New York City celebrity. The inaugural edition was picked by comedian and actress Megan Stalter.

In the back of the store are Target-branded gifts aimed at tourists, along with a revamped beauty section. The latter is a category where the retailer can be competitive, Feldman said, because young shoppers are attracted to the celeb-led space.

Beauty makes up 12 per cent of Target’s bottom line, according to its annual report, with sales growing for the past three years. Still, it’s had some stumbles after its partnership with Ulta ended.

Target admits that all the changes made to the SoHo location, which reopens this weekend, won’t be introduced universally across the country. But Sylvester expects the store to provide “a lot of learnings of how can we scale pieces and parts of it.”

Incoming CEO Fiddelke also appeared at last Monday’s press preview, with Feldman noting that his “fingerprints” are on the concept because his name was mentioned in the press release. (Cornell, meanwhile, wasn’t.)

“They’re trying to set him up for success,” Feldman said. “They set him up for an easier year next year … but you probably won’t see the real fruits of his labor until later in the year or 2027.”

By Jordan Valinsky, CNN