If you want to beat the big guy, you have to get creative. If you're Target and the big guy is Amazon, getting creative means figuring out how to deal with that company's aggressive push to get shipments to customers more quickly by using the one asset you have that the big guy can't compete with--your stores.
Of course, Amazon has an enormous network of warehouses and delivery vehicles that it uses to deliver millions of products for free in as little as one day to its Prime members. One-day shipping is expensive for retailers to offer and hard to beat in terms of customer convenience. For Amazon, however, it has all but eliminated the main barrier to online shopping--having to wait for your products to be delivered.
But you know what's better than one-day shipping? Getting the stuff you want the same day.
That's exactly what Target has done with its Shipt membership program that offers same-day delivery for a membership price that is $20 less than Amazon's Prime.
But same-day delivery isn't even Target's most impressive response. The most impressive part of Target's effort to take on Amazon is the company's Drive Up service that allows customers to place orders online and have them delivered curbside, often in less than an hour. As of Thursday, Drive Up is now available at over 1,700 stores in all 50 states.
By the way, Target's announcement uses my absolute favorite poke at Amazon, pointing out that there's "no membership required," to use Drive Up. Bullseye.
For a parent heading from school pickup, to soccer practice and then a dance recital, pulling up and having your order delivered to your car is almost easier than wondering when it will show up on your doorstep.
In fact, Target has actually forced Amazon to adapt to its game. Amazon is rolling out a program that offers counter pickup at a selection of Rite-Aid stores, an implicit acknowledgement that it sees Target's move as a real threat--or just really smart. You know you're doing something right when you can make Amazon change what it's doing to respond to you.
And Target did it by leveraging it's most valuable asset: that network of 1,800-plus stores across the United States. People who shop at Target shop there because they like being at Target. They like the stores, and the experience.
In fact, Target's brand is that it's the 'cool' retail big box store, and it prides itself on being a place people want to visit. Even when they don't have to wander the aisles, Target is making it easier and easier to have that same experience.
And Target is leveraging its stores in some pretty creative ways. It has been rolling out smaller-footprint stores in urban areas and on college campuses over the past few years, and just this week it announced that it would be opening dedicated Disney-focused sections in 25 stores this October.
For all the work Amazon is doing to build out its warehouse and shipping network, it still can't offer the same in-store shopping experience as Target, or offer same-day pickup in basically every suburban area in America.
Target can, and it's proving to be a brilliant way to take on a much-larger competitor.