Target Focuses on Food, Not Fashion, in East Harlem

Last Updated Aug 6, 2010 12:59 PM EDT

Forget, cheap chic. Cheap eats are what Target (TGT) is counting on to drive sales at its new East Harlem location.

From the looks of things, Target is depending on the surrounding community for the critical support it needs to succeed, rather than the frugal fashion impulses of consumers from elsewhere in the borough of Manhattan. The East Harlem location, which looks to be considerably -- perhaps a third -- smaller than the retailer's biggest facilities, turns out to be a P-Fresh store. That means it mounts the most comprehensive food presentation Target offers, with a selection of produce and fresh meat that's limited but still extensive enough for customers to shop the location as a basic grocery store.

With the big food presentation in a smaller store, Target is clearly looking to draw local consumers who might be underserved by city supermarkets, as many Manhattan residents are. However, as underserved as they might be, Manhattanites who live more than a mile away would have to pass any number of food retailers to go grocery shopping at Target. The prospect is pretty daunting for Manhattanites from outside East Harlem. The subway is half a mile away, parking starts at $4.70 with taxi, and a car service that operates from Target's doorway charges $8 for the first mile of transport. No mater how it's sliced, groceries at Target are only a bargain for consumers who live nearby.

The store's food orientation raises interesting prospect because the other major resident of the East River Plaza shopping center where Target resides is Costco (COST). With the warehouse club providing the bargain bulk staples and Target reasonable prices on more modestly sized, everyday purchases, retailers combine stores to make an extremely muscular supermarket. Purchasing bulk cereal at Costco and mayonnaise at Target -- those foodservice-sized condiments aren't going to fit in little Manhattan refrigerators -- could represent a prudent balance for East Harlem shoppers.

Target gets attention for its flash, the designers it runs in and out of its stores and the long, teasing marketing campaign it has used to excite New Yorkers to the prospects of its store debut in Manhattan. The retailer's New York flirtation has featured billboards, imitation graffiti and pop-up shops, the temporary stores it likes to suddenly open in novel environs, particularly around the holidays. And it's not like Target is giving up on sales in departments such as apparel. A display featuring Stephen Burrows, one of the retailer's Harlem Design Collection partners, was up front and conspicuous at the East Harlem store. Still, to draw disposable fashion shoppers up town, Target has to lure them past Century 21 and multiple H&M (HMB) locations. Another tough sell.

In fact, during a store visit the only category of products that seemed as likely to cram shopping carts on the East Harlem store's opening day was back to school merchandise. Just as shoppers in the grocery section discussed and expanded their food purchasing, using cell phones to do so occasionally, customers on the long opening day check out lines bragged about all the back to school shopping they had finished.

Further south on the storied island, that might have been accomplished at Kmart's downtown or midtown locations. But, in East Harlem, Target was the spot where the neighborhood began preparations for September and the new school year. Target might not be at the center of New York's fashion scene, but as long as it can keep churning out everyday needs at the periphery, it might do quite nicely.

Despite how things balance out in East Harlem, Target's plans for Manhattan are more likely to gain ambition than to become pinned into one neighborhood. Even if it can't count on drawing waves of customers from across Manhattan to East Harlem, the rest of the island is on its mind. Additional pop up shops and other promotions that make Target products more accessible to Manhattanites can be built out of the East Harlem store and assuredly will be.