Photo: RetailWire
Will Target’s customers treat October 10 like Black Friday?
Target announced yesterday that it will kick off its Christmas promotions on Sunday, October 10. The retailer is looking to cash in on the opportunity created by earlier shopping trends this year as supply chain disruptions and product shortages have become daily news.
The retailer’s Target Deal Days promotion will run for three days with big savings promised on thousands of items in the chain’s 1,900 stores, online and through its mobile app. It will mark the first time that Target has made all its deals available on all sales touchpoints to its customers.
“Guests are excited to shop early, and our team is ready to help them prepare so they can celebrate what matters most — time with family and friends,” said Christina Hennington, executive vice president and chief growth officer, Target.
Research by AlixPartners found that 53 percent of consumers plan to start their holiday shopping before Halloween this year, a four percent increase over last year. RetailMeNot found that 59 percent of shoppers expect to start shopping for Christmas before October is done.
Target is playing up savings in a year when prices have increased steadily. The retailer is publicizing a price match guarantee for the holiday season to “provide guests with the confidence they’re getting the best deals at Target, no matter when they choose to shop,” said Ms. Hennington.
Target has been one of the shining lights in the industry since the pandemic hit. COO John Mulligan told analysts on the company’s earnings call last month that it has taken steps to fortify its inventory of goods and is “well-positioned” to drive sales for Christmas 2021 versus its record performance last year.
The chain’s comparable sales during November and December 2020 were up 17.2 percent as traffic increased 4.3 percent and the average ticket jumped 12.3 percent. Same-store sales in physical locations rose 4.2 percent during the last two months while Target’s digital revenues grew 102 percent.
Target gained market share in all five of its core merchandise categories during the 2020 holiday season with home and hardlines making the biggest gains.
The chain’s emphasis on becoming the easiest place to shop was evidenced in the growth of its same-day services, including Drive Up (up more than 500 percent) and Shipt (up more than 300 percent). Ninety-five percent of all Target’s sales were fulfilled by stores.
- Target Deal Days and New, Industry-Leading Holiday Price Match Guarantee – Target Corporation
- Will Americans finish this year’s Christmas shopping before Thanksgiving? – RetailWire
- Will overstocking get retailers through the holidays? – RetailWire
- Target Provides Update on Holiday Sales – Target Corporation
Discussion Questions
DISCUSSION QUESTIONS: What do you see as Target’s strengths heading into the holiday season? What are its greatest vulnerabilities?
Poll
Loading …BrainTrust
Jeff Sward
Founding Partner, Merchandising Metrics
Patricia Vekich Waldron
Contributing Editor, RetailWire; Founder and CEO, Vision First
Target is taking a page from Amazon’s Prime Days by kickstarting the holidays early on Target’s desired schedule. Consumers are so primed by the national media that shortages abound that Target’s biggest strength may be its stockpile of desirable goods. The only downside I see is that it’s Q3, so Target will have an interesting time comping next Q3.
Target is proving more and more with moves like this that it is the industry standard-setter. This decision will hopefully encourage and force both retailers and consumers to be more planned with holiday to avoid some of the supply chain bottlenecks that feel inevitable. Target’s seamless omnichannel offerings are its strengths, and the quality of its order online pickup in person services will facilitate a strong holiday performance.
Target’s biggest vulnerability is availability. This has always been Target’s Achilles’ heel but it will be even more of an issue this year as supply chains are disrupted and could cause major shopper frustration. Another issue is having enough staff in-store to cope with the volume of omnichannel orders. In the past there have been numerous complaints from stores that they are not adequately resourced to cope. The strengths are the assortment, which is looking very on-point, and Target’s very strong omnichannel presence which makes shopping easy. I am sure Target will, once again, be a winner this holiday season.
With Target’s add-on services like Drive Up and Shipt – they have a great advantage as they are making the shopping journey easier. Starting early is a no-brainer as most of the shipping companies are already “pre-selling” longer delivery times and delays. As for vulnerabilities, as long as they have the inventory I don’t see any.
Black Friday used to be creeping onto earlier and earlier dates on the calendar. Now it’s lunging to earlier positioning. Sounds like Target is trying to position themselves for a double dip. Create a spike in early October and hope to replenish inventories in order to be able to meet demand for the balance of the season. Maybe the October event can contribute incremental sales (plus market share) rather than just shifting sales on the calendar. But of course that’s what every retailer would want to do. Target will continue to benefit from the deep wells of customer confidence they have built up over the course of the last couple of years. Nothing succeeds like success.
Target is smart to get into this NOW. So many retailers are telling consumers that shortages are going to continue and if you want something buy it now before it is not available. I believe availability is going to be the sore thumb here so I hope they have enough of what they are going to offer.
Target knows their customers, and they are masters of private label. That translates to brand affinity and strong loyalty. During the pandemic they’ve only gotten better. Heading into the holiday I do think they’re going to continue to be successful. I’m not bullish on an October 10 event, I don’t’ think enough consumers are thinking far enough ahead to associate this event with the holidays, but we’ll see. In-stocks has been the key issue for Target, but they know that. For key items and holiday drivers I’m confident in their inventory planning. One thing to watch will be how well they can scale their curbside and delivery service to what is sure to be huge demand.
If it is accurate that 53 percent of consumers plan to start their holiday shopping before Halloween, hold on to your carts! Get the traffic force ready to direct the mobs. The announcement of the event and the deals will move anyone and everyone to be there. It’s all about first dollar sales and Target is not playing around! This is going to be a season of sales to watch!
Last year cemented the change from a holiday shopping Deal Day to a Deal Season. Target is carrying that forward, very smartly, giving customers plenty of opportunities to get the products they need and want. Their assortment, service and investment in digital, fulfillment and supply chain will enable them to successfully meet demand and expectations.