Target Cuts Prices of 5,000 Items; Biden Calls on Other Companies to Follow Suit

Target will lower the everyday prices of approximately 5,000 frequently shopped items. Reduced prices already are in effect for about 1,500 items, and additional cuts will be instituted over the summer. Consumers will see lower prices on products including milk, meat, bread, soda, fresh fruits and vegetables, peanut butter, coffee and diapers.

In a post on X, The White House praised the move and noted that President Biden was calling on “other big corporations to join these leaders and lower grocery prices to give families more breathing room.” In fact, Biden’s administration has been doing more than encouraging retailers to take advantage of cooling inflation by lowering consumer prices; it’s also going after alleged price-gouging. In March 2024 the White House announced the creation of a Strike Force on Unfair and Illegal Pricing, co-chaired by the Department of Justice and the Federal Trade Commission (FTC).

“Target’s move to address price fatigue by cutting prices on 5,000 essential items is the latest evidence that prices are coming down in the categories consumers care about most,” said Matt Pavich, Senior Director of Strategy and Innovation at price optimization solution provider Revionics, an Aptos Company, in remarks provided to Retail TouchPoints. “Not only is Target launching brands like dealworthy to meet the moment, but Target is also ensuring that the key value items (KVIs) consumers depend on are affordable and better priced than the competition. This is essential as endless consumer surveys and sales data show that consumers are unshakably looking for value (we’re in a down trading economy, that’s no question).”

FTC Claims Big Grocers are Profiting Unfairly

Grocery retailers in particular have come in for criticism by the FTC, which issued a report in March 2024 saying that some in the industry appear to have used cost increases brought on by COVID supply chain disruptions as an opportunity to raise prices and increase profits.

“The FTC’s report examining U.S. grocery supply chains finds that dominant firms used this moment to come out ahead at the expense of their competitors and the communities they serve,” said Lina Khan, Chair of the FTC in a statement.

Target’s announcement comes as inflation appears to be cooling. For April 2024, overall inflation increased by 0.3% on a seasonally adjusted basis, after rising 0.4% in March, according to the U.S. Labor Department’s Consumer Price Index. Food prices remained unchanged in April, and food for home consumption prices actually declined by 0.2%.