Holiday season is right around the corner and Target has been occupied upgrading its supply season. This holiday season will mark its biggest test yet, as the retailer said early last year. It would put $7 billion into investments to improve its business over the next three years. One portion went towards upgrading its delivery options, making it more convenient for consumers to shop in Target stores, as well as online. CNBC reports Target declined to comment how much it spent on investments, however, it’s quite clear to see the results as free two-day shipping, curbside pickup and same-day delivery in major metro areas emerged. Target even acquired a transportation company.
Target has a huge opportunity as it competes with rivals such as Walmart and Amazon this holiday season with its new convenient options as they may make the difference in where a shopper goes for their holiday treats and gifts. Although, according to some forecasts, another strong holiday may not be as vigorous as last year.
“From my perspective I think Target has a more differentiated product assortment than Walmart today,” Stacey Widlitz, president of consulting group SW Retail Advisors, told CNBC. “They have the product to win, and now they are putting the tools in customers’ hands — like two-day shipping.”
“Customers are now like: ‘Wait a minute. Target behaves like Amazon, and they have strong private-label categories. Why would I not add some extra stuff in my basket?'” she said
Target stores fulfilled 70 percent of all digital orders last holiday season, according to the company, and this years, the percentages are said to be even higher. The company plans to hire 120,000 temporary workers, or 20 percent more people than it hired a year ago. Nearly 7,500 of those workers are expected to assist in packing boxes in warehouses.
“Our stores are at the center of our digital growth,” CEO Brian Cornell told CNBC last month. “They are fulfilling the majority of our online orders. … They are center to everything we are doing at Target.”
Target just experienced one of its strongest quarters ever, so with this holding season around the corner, the company will need to prove it can keep its momentum going. One way of ensuring this is proving its network of distribution centers and delivery services can handle the surge in traffic in stores and digital orders.
“Last August, I ordered a bunch of stuff from Target, and it took so long to get it,” Widlitz said. “This year, I ordered stuff, and I got it next day, and some of it was even flown in. That is a game changer.”
One new upgrade is the free two-day shipping for Target credit card holders, which initially launched earlier this year. Two day shipping will be free for everyone else who makes a minimum order of $35. Targets two-day shipping may be viewed as better than Amazon, who offers free two-day shipping for Prime member who pay $119 annually. Walmart offers the same free two-day shipping on orders over $35, but it doesn’t offer the credit card perk.
