Target's CEO Brian Cornell doesn't pull any punches when it comes to the most important shopping period of the year. "You're going to see us play to win during this holiday season," Cornell said yesterday at an event where he laid out the retailers holiday game plans. Of course, that plan involves one less weekend this year for shoppers to pick up the latest gadgets, toys, and home decor, which means that every move counts.
In reality, Target has been preparing for this battle for some time now, especially when it comes to competing against its larger competitors, Amazon and Walmart. And make no mistake, all three companies are in this with every intention to win.
Here are the three ways Target plans to take it to the competition, and why your business should pay attention to each:
Create In-Store Experiences
Target says it has spent $10 billion to transform its stores, including remodeling 700 locations and opening more than 100 small-format stores in urban areas and on college campuses. The result is that those physical locations have become one of its most valuable assets.
That's because, while Americans increasingly shop online, Target continues to draw customers through the front door. That investment is a large part of the reason why, with Cornell saying that remodeled stores have seen a 2-4 percent increase in sales. Part of that is due to a focus on creating an engaging customer experience.
For example, Target recently announced a partnership with Disney that brings Disney mini-stores inside 25 Target locations. Those stores feature interactive areas for kids and exclusive items previously only available at The Disney Store. All of this is designed to create destinations within the stores, which increases both the number of visits, and the amount of time customers spend per visit.
Make It Easy
One of the biggest headlines from the company's event was that Target is adding $50 million in payroll to increase staffing in its stores during the holiday season, but the bigger story is why. Much of that investment is in staffing out the company's drive-up, in-store pickup, and Shipt delivery fulfillment, along with other service-focused roles. Those programs are designed to make shopping at Target as easy as possible by offering a range of options for busy customers.
While competitors like Amazon offer discounted pricing and one-day delivery, Target is using its physical locations as virtual distribution centers to let customers choose how they want to shop. And, for many consumers, free same-day pickup or drive-up service is more convenient than shipping anyway.
Of course, Target says it will also offer free shipping on every order starting November 1st, which further reduces the barrier to shopping. Make it easy for customers to shop. Make it easy for them to get their order, and make it easy to fit both of those things into their life.
Target says that it will again offer over 1,500 unique gift ideas, with most under $15. Most of these are Target exclusive brands, and make it easy for the customer to cross another gift off the list while bringing in incremental revenue for the company.
The company also recently introduced a new membership program that gives shoppers 1 percent of their purchase as a reward they can use off future purchases. By the way, over 25 million customers have become members of Circle, according to Cornell, and those members spend on average 2-5 percent more per visit.
The lesson is simple: Create an easy way for your customers to get what they want in the most convenient way that fits into their lives, while adding value. That's a winning play for Target, and it's a winning play for your business.