Bed Bath & Beyond has a plan to stop losing bargain hunters to Amazon and Target

New York(CNN Business) Bed Bath & Beyond has decided it's too expensive for some shoppers. It's trying to change that.

The chain has launched a new low-price, in-house brand to compete for bargain hunters who've been finding cheaper stuff on Amazon and at Target. The company also wants to expand its private label business, which is more profitable for Bed Bath & Beyond than selling third-party brands.

The new brand, Simply Essential, includes more than 1,200 home, kitchen, bath and bedding items, with ladles and serving spoons for $1, bath towels for $4, and pillows for $5. "Wow-worthy prices on everyday basics," Bed Bath & Beyond boasts in a new advertisement.

Bed Bath & Beyond has struggled in recent years against a host of competitors in the home goods industry and is attempting a turnaround under new leadership.

The company has said that in the past it had overlooked so-called opening price points — or the cheapest items in a product category — and was losing out on customers as a result.

Simply Essential is designed to fill that gap and help Bed Beth & Beyond appeal to shoppers looking for the lowest prices in areas such as kitchen utensils, where around half of the market is made up of such prices, according to the company.

"Bed Bath & Beyond had zero assortment in that opening price point [for kitchen utensils]. So we're giving away the customer in 50% of the total market penetration," CEO Mark Tritton said at an investor conference last month. Tritton, a former Target executive, took over as CEO in late 2019.

Cristina Fernandez, a retail analyst at Telsey Advisory Group, said the chain is working to improve customers' perceptions of its prices against competitors.

"They were seen as being a little bit too expensive," compared to Amazon (AMZN), Target (TGT) and HomeGoods, she said. The new collection will allow them to compete for a "bargain, value-conscious" customer.

Simply Essential is Bed Bath & Beyond's third private label brand to launch this year. The company will launch at least five more by next year and plans to increase its private label brand sales to 30% of total sales, up from around 10% today.