In today’s on-demand environment, Target is taking up the challenge of making shopping both easy and fun for consumers whether they’re popping into stores or filling their virtual carts.
Speaking at the ShopTalk conference in Las Vegas on Sunday, CEO Brian Cornell outlined the ways in which the retailer is keeping up with consumer demand, aided by the latest technology as well as leaning into some traditional retail strategies.
Cornell, who was joined on stage by Shipt CEO and founder Bill Smith, highlighted how Target is overhauling every aspect of its business from building a faster network to introducing a slate of new private label brands.
“Our guests love to shop. Our job is to make it easier, more fun and more enjoyable,” Cornell said.
One way the company is responding to this demand for convenience is by providing a wide range of fulfillment options. Target has expanded BOPIS to drive-up pickup, giving shoppers the option of making their Target run without having to leave their cars. Through its acquisition of Grand Junction last year, consumers in urban areas are enjoying same-day deliveries. And with Shipt same-day is expanding even further. By holiday, the company confirmed it anticipates offering the near instantaneous deliveries to 65 percent of U.S. households.
“We acquired the Birmingham-based startup in December with the goal of becoming the first retailer to offer same-day delivery nationwide,” Cornell said. “We could have tried to build this capability in house but Shipt already had a loyal membership base and a roster of great retail partners.”
Target liked that Shipt had been able to scale from one market to 70 in three years, but the company was also drawn to another important facet of the business. The Target team liked that through Shipt, deliveries were made in a personal way, which helps forge relationships.
“We have focused on building a high-quality experience, and that starts with our shopper community,” Smith said. “When you order from any of the retailers on the Shipt platform, the same person who is picking your avocados and selecting your eggs is the same person who shows up at your door.”
Cornell said that element of the Shipt model dovetails with Target’s own philosophy. “We spent a lot of time with their shoppers and seeing how important that relationship was and looking at their ratings. One of the things Bill said was these are moms shopping for moms so they don’t want to disappoint,” he said. “And that’s what Target is all about. That human interaction, that human touch, is what will separate us from some of the other competitors. That philosophy of making sure it’s a great experience.”
The one-on-one interaction is something Target is trying to bolster in its stores as well. To do so, the retailer is investing more in its sales floor team, too. As announced during its fourth quarter earnings call, Target is boosting its starting wage to $12 this spring. But Cornell said that’s just the start.
“It’s more than just wages—we’re investing a lot in hours, staffing, training and development, and creating experts within our stores because we know, as we listen to the guests, in certain categories, they want someone there who’s an expert,” he said, listing beauty, apparel, food and electronics as areas that are higher touch. “We’re investing in expertise in those core departments where consumer expectation is for a great experience and an interaction with a knowledgeable employee.”
So even as Target is focused on speed and convenience for online consumers, the retailer is also working to create a better experience for those shoppers who prefer to visit the stores.
For Cornell, it comes down to what he calls “the power of ‘and.’” The chief executive said Target is striving to strike a balance across its business. “How do we take our own brands and great national brands? How do we combine the experience and the importance of value which is still a huge expectation? How do we bring the best of specialty in departments like beauty and also leverage our mass merchandising skills? How do we blend both the physical experience and that digital experience in a way that meets the needs of that guest, that end consumer that we serve?” he asked. “It’s not one or the other.”