Target's Data Breach Costs the Company $148 Million

While the San Francisco-based office, which has about 20 employees, is focused on testing and exploring new technologies with startups, the Sunnyvale office will be more geared toward data analytics and engineering for its online and mobile teams, said Eddie Baeb, a Target spokesman.

“This is really about being in a location that's close to and makes it easy for the talent we want to work with to be at Target,” he said.

Target was one of the first retailers to open a tech innovation lab in Silicon Valley. Today, companies such as Nordstrom, Home Depot, Staples, American Eagle, Wal-Mart and Sears have all followed suit and opened up shop there in an effort to find the talent to help develop technology that optimizes the shopping experience.