Target takes on startups like Away with new luggage brand

In the last few years, a number of startups led by the company Away have disrupted the sleepy luggage market with an array of colorful hard-shell suitcases that incorporate features such as built-in batteries to recharge your gadgets.

Now Target is looking to get in on the action, too.

After overhauling most of its apparel and home brands, the Minneapolis-based retailer is now eyeing other categories where it could increase its business — such as luggage.

Target's new luggage brand, Open Story, lands in stores on Sunday and on Target.com on Feb. 13.

The nearly 40-piece line includes hard-sided checked and carry-on luggage, backpacks, packing cubes, garment bags and totes, with prices ranging from $19.99 to $179.99. The suitcases include features such as USB ports for a battery or power bank, a built-in TSA lock, a laundry bag and many zippered pockets to help travelers to keep items organized.

"We know from looking at market trends that the consumer is looking to travel more and more and is preferring to go on experiences," said Julie Guggemos, Target's chief design officer. "We decided, as we look at the travel industry, that it would be a good opportunity for Target to create something that offers the best of the best from a features standpoint at an incredibly affordable price."

Target's new carry-on suitcase, for example, will sell for $149.99, which Guggemos said is about 30% cheaper than comparable products from major competitors. Away's carry-on suitcases start at $225.

Target's designers and engineers spent about 14 months developing Open Story, researching not only the features offered by premium luggage brands, but also talking to consumers about what they are looking for in luggage and where they would like to see improvements. They went through several prototypes and stress-tested them on trips and on cobblestone streets.

"It's going to blow all other luggage offerings out of the water," Guggemos said.

Target decided not to include a battery with its suitcases. Built-in lithium batteries are now barred from being checked on flights in the U.S., and some airlines now require them to be detached when carrying such luggage onto flights.

"We decided to let the consumer decide what they want to do," she said.

The suitcases also come with a hardy polycarbonate shell, four silent 360-spinning wheels and are expandable. They will come in about a dozen colors.

While Target has been seeing some growth in luggage sales, Guggemos said it hasn't been on par with the rest of the market. With Open Story, she said Target hopes to outpace competitors.

Luggage sales have risen 11% in the U.S. since 2016 and are now a $2.3 billion industry, according to Beth Goldstein, an industry analyst with the NPD Group.

In addition to the growing interest in travel and experiences, enhanced features and functionality are also helping to fuel growth, she said.

"I think there has been a halo effect from the startups, most notably Away, but even the ones that didn't survive, like Raden and Bluesmart," she wrote in an e-mail, noting that traditional players are also now adding more features such as luggage sleeves and extra pockets.

The challenge, though, is that consumers don't buy new suitcases very often, which could hinder sustained growth.

This is not Target's first foray into private-label luggage. It has a longtime brand called Embark and more recently launched an in-house line through one of its newer, though more budget-focused, brands, Made by Design. It also carries national brands such as American Tourister.

Open Story will be prominently displayed in Target's luggage section, but the overall space for the section won't change. Instead, the retailer is making room for it by shrinking its offerings from other owned and national brands, Guggemos said.

In addition to remodeling stores and adding new fulfillment options, refreshing Target's owned brands has been a key part of Target CEO Brian Cornell's strategy that has led to impressive sales gains over the last two years. However, Target reported last month that its sales over the holidays came in lower than expected, a rare miss for a retailer that has become one of the better performers in the industry.

Target has now rolled out more than 40 new brands over the last several years. Last month it launched All in Motion, an activewear brand that replaces C9 by Champion.

While the pace of new brand rollouts has begun to slow, Target is now looking at other categories outside of apparel and home, which had been its initial focus.

As for what's next, Guggemos said Target is looking at everything from sporting goods to toys.

Kavita Kumar • 612-673-4113