Inside Target's AI-powered turnaround plan

Published: Saturday, March 7, 2026 at 10:00 am

Target Bets Big on AI for Turnaround

Target is embarking on an ambitious turnaround strategy, heavily reliant on artificial intelligence, following a period of sluggish sales. The company's tech chief, Prat Vemana, highlighted the crucial role of AI in the retailer's revitalization plan, emphasizing its importance in a competitive market.

The strategy includes significant investments, with $1 billion allocated for additional capital and another $1 billion for operational commitments. The plan also encompasses the opening of 30 new stores, the remodeling of 130 existing locations, and overhauls to a significant portion of product assortments. Target anticipates sales growth in every quarter of 2026, with early signs of acceleration in February sales.

AI-powered tools are central to this strategy. Target is leveraging AI across various aspects of its operations, from product design to in-store experiences. The company's apparel teams are utilizing a "Trend Brain" platform, which analyzes fashion trends and social media sentiment to predict upcoming styles. This allows for faster design cycles and quicker responses to market demands.

In-store, Target is equipping managers and associates with new AI-driven tools on handheld scanners, streamlining tasks such as display planning and restocking. The company is also integrating AI into its app, including features like a shopping list scanner and a store mode that maps items within a physical location. Target is also among the first retailers to offer multi-item baskets through ChatGPT and is partnering with Google on the open commerce protocol on Gemini.

While the full scope of Target's AI investment remains undisclosed, Vemana stressed that the company views the technology as essential for its growth. The focus is on strategically implementing AI to strengthen its foundation and drive improvements across the business.

BNN's Perspective: Target's embrace of AI is a bold move in a rapidly evolving retail landscape. While the success of this strategy hinges on execution and return on investment, the company's commitment to innovation and customer experience is encouraging. It will be interesting to see if this strategy can help Target regain market share and compete effectively with its rivals.

Keywords: Target, AI, turnaround, retail, sales, technology, innovation, strategy, investment, app, generative AI, Trend Brain, shopping, customer experience, Prat Vemana, Michael Fiddelke

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