LAS VEGAS — Target Corp. is flipping the switch and turning its stores on — technologically speaking.
The retailer’s chief executive officer Brian Cornell was a keynote speaker at the second annual Shoptalk conference taking place through Wednesday in Vegas, where he spoke about how Target is looking at the future of retail. It’s placing its chips on a revamp of the existing fleet that makes them one part showrooms people can shop and one part logistics hubs to fulfill digital orders.
“In this new era of retail, stores need to be multidimensional showrooms,” Cornell said. “They have to be a destination for services. More and more we’re positioning our stores to be guest-facing hubs.”
Stores serving as fulfillment centers will mean shipping orders twice as fast as what can be done from a distribution center, Cornell pointed out. The retailer is currently testing same-day delivery in select markets this year.
“We also have some stores that today are really tired and if you look across the competitive landscape, those folks that deferred investments, well, they’re struggling,” Cornell said. “You just can’t be in the game; you have to invest. And at Target we’re doubling down and we’re fortunate enough to have the chips to do it.”
That investment, more specifically, is to the tune of some $7 billion set to be spent over the next three years to revitalize more than 600 stores.
Testing of innovations at Target stores in Houston and Los Angeles has been taking place for about a year. The best of the best of those technologies will now be rolled up into a first-generation prototype store set to open in Houston later this year.
Although technology is important, the company also realizes it’s up against a ticking clock. Target earlier this year scrapped plans for a high-tech store of the future that was set to be located in Silicon Valley.
“We made a tough choice and when we think about the future, innovation’s a really important part of it,” Cornell said of the store. “Our focus on innovation has to be something we can realize over the next three to four years inside the core business.”
Keeping the merchandise mix relevant and interesting to consumers is also a focus, with Target set to launch more than a dozen new brands over the next two years, which Cornell said amounted to about $10 billion worth of product.
Those lines will be supported with their own dedicated landing pages online and, at brick-and-mortar, the merchandising strategy will be improved and complemented with marketing pushes.
While all of these tactics may not necessarily be earth-shattering on their own, Cornell said, it’s the aggregate that will help drive market share gains for the company.
Taking share was certainly a motivator for why the retailer decided to open up across from Macy’s with a store in Herald Square in news revealed Monday.
“We’re going after market share right now,” Cornell said. “We’re investing to win and winning — it’s all about taking market share over the years.”
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