Target has a plan to end the Christmas sales madness
The 2016 Christmas selling season was a disappointment for Target with same-store sales declining 1.3 percent. The retailer isn’t looking to repeat the same mistakes.
Last year, Target focused heavily on promotions, including 10 days of deals around the Black Friday weekend. In the end, management concluded that the frequency and number of deals offered only watered down the effectiveness of its marketing. This year, Target heads into the holidays with a simpler plan that combines lower everyday prices, new private label lines, curated gift selections and a more focused promotional schedule.
The recent move by Target to lower everyday prices on products across its stores has helped set the stage to curtail promotional offers. The chain has also been engaged in an aggressive store remodeling program in locations across the country to improve the shopping experience.
Mark Tritton, chief merchandising officer for Target, told reporters at a briefing last week that the retailer will start off the season strong with deals for the Black Friday to Cyber Monday. While pledging to offer “meaningful promotions” throughout the holidays, he said, “priced right daily will be our regular drumbeat.”
A key component of Target’s holiday strategy will be eight new private labels across categories, including baby, kids, men’s and women’s apparel, accessories and home. The chain recently debuted its Project 62, A New Day, Goodfellow and JoyLab lines. The Hearth & Hand with Magnolia exclusive label co-designed with Chip and Joanna Gaines will roll out on Nov. 5. The line, which features 300 products, most for less than $30, includes giftables, home décor and tabletop items.
Target has upped its omnichannel efforts with 1,400 of its 1,800 stores now set up to fulfill online orders more quickly. The retailer, as in the past, will offer free shipping with no minimum order on purchases made from its site between Nov. 1 and Dec. 23.
The retailer is also introducing GiftNow on Target.com. Shoppers click on products with GiftNow buttons to send an e-gift box. The recipient can accept the gift, change the color or size, or choose something entirely different, all before anything ships. Target said the service, which covers thousands of items, is a great idea for last-minute shoppers.
- Target Brings Joy to the Holiday Season with New Brands, More Ways to Shop and Save – Target Corporation
- Target Is Keeping It Simple for Holiday Season Sales – Fortune
- Target plans fewer promotions it hopes will pack bigger holiday punch – Minneapolis Star Tribune
DISCUSSION QUESTIONS: Does Target have the right plan in place to help grow same-store sales during the holidays? Which of its initiatives — lower everyday prices, fewer promotions, new private labels, exclusive brands, remodels or omnichannel — do you think will be most critical to the chain’s top and bottom line performance?