What makes target so successful

Supply chain strategies include using robotics and artificial intelligence to support the warehouse team with task-oriented work such as sorting millions of products by store and by aisle. The box-sort-sequence process allows stores to stock products in a highly efficient manner resulting in fewer out-of-stocks and better customer experience.

The idea is to utilize technology to execute tasks that are non-sell so the employees in the stores can focus on the customer touchpoints. Small-store formats have been a big win for Target, and while the rollout was slow and measured, it has been able to perfect the model leading to 30 small-format store openings this and next year. Small formats include Life on Campus, iconic tourist destinations and urban locations. The electronics department within existing stores is a key focus and remodels are slated over the next two years.

Product assortments have been carefully curated and developed by a world-class design team focusing on using customer feedback in the design process through focus groups and creative apps. Additionally, Target has added direct-to-consumer DTC brands that help build connections between its target market and smaller niche retailers.

Lastly, big-name partnerships are part of the ongoing strategy of using vendors as collaborators in the business such as Levi and Disney. Beauty and apparel are two categories that are big winners for Investments in the beauty department have paid off with growth in of 7. The apparel category and assortment mix helped to raise gross margin in to Through these many initiatives, Target is changing customer behavior and providing seamless integration across the digital and physical shopping environments.

The pick-up and drive-up have increased shopper traffic in stores by 2. This included a clothing line with Victoria Beckham, a homeware collection designed by Chip and Joanna, and a clothing and swimwear collaboration with Vineyard Vines. These exclusive designs not only create a hype around the store but give customers a reason to visit it.

While Target lags behind its competitors on the Facebook fan front, it is far outpacing them on Instagram, an app that customers are increasingly using for shopping online and as a place to find inspiration before heading to stores. This helps drive traffic to stores. It makes it easy to shop for anything featured in these photos by linking the images on its feed to their corresponding weblink and often reposts photos uploaded by shoppers and bloggers using its products on Instagram to humanize its social-media campaigns.

Analyst David Gordon told Business Insider that retailers are increasingly devoting more space to areas where people can come in, have a coffee, and interact with each other. Target offers a Starbucks cafe in many locations, and in the past it has also partnered up with other suppliers such as salad chain Freshii to offer fresh salads and wraps. This helps to drive traffic to stores and hopefully encourages customers to shop in Target before or after they visit the cafe.

Target makes one final push at the cashier to make that final sale with its Bullseye Playground section. Referred to by Target as "that grab-and-go mecca at the front of Target stores known for killer dollar deals," this isn't just a candy station. These mini curated sections are located at the front of stores with a selection of products that are either on promotion, are locally related, or are seasonal.

It's the last chance for shoppers to load up their carts. For you. World globe An icon of the world globe, indicating different international options.

Get the Insider App. Click here to learn more. A leading-edge research firm focused on digital transformation. Good Subscriber Account active since Shortcuts. Account icon An icon in the shape of a person's head and shoulders. It often indicates a user profile. Log out. I would say they are getting closer to that goal, but unless they figure out produce, meats and fish, they will not get there. Long term retail success is predicated on offering an omnichannel experience.

Despite the recent surge in COVID cases, people still are willing to venture into brick-and-mortar stores. Target has done a good job of creating a safe and inviting store environment. Online will continue to grow for Target and others. The key is the optimization of stores. For a number of reasons pandemic fatigue, low consumer debt, etc. Target is prepared. Specialty retailers should not broaden their mix to compete with chains like Target.

Instead, they should establish credibility in their niche, go deep, and add service elements to differentiate further. Use data to craft higher engagements and launch or enhance cutting edge data science-based loyalty programs.

As for Target, the company has been steadily shoring up its core strengths of merchandising, expanding grocery, and integrating online and offline shopping. The stores are bright, colorfully displayed, and the associates are helpful. The current trend of one-stop shopping has definitely helped Target, as have BOPIS, curbside pickup and home delivery, but Target also has a loyal customer base who shop there based on assortment, services and ease of shopping.

The pandemic has brought out fear of smaller establishments that might not have a strong reputation for cleanliness, bright lighting, associates cleaning registers and carts after each use and precautions to keep customers safe. One-stop shopping also plays into the equation, but only after the customer enters the store increasing wallet share of a loyal customer base.

Unless retailers have a similar business and a wide assortment, it would be challenging for them to match Target. People forget retail is rarely a copycat business — each retailer is unique. Convenience for the shopper has been the byword in retail. The only thing the pandemic has changed is that it has put the concept on steroids. Target has implemented a number of customer focused digital engagement initiatives that are complementary to their one-stop shopping journey.

They have created a great shopping experience, from the private brand merchandise, to the renovated store layouts, to the fulfillment options. If they keep innovating and focusing on customer experience, I believe their success will continue long after this pandemic. Great shopping experience inside and well lit and laid out, plus signboards telling you what is out of stock used to be cleaning supplies, now it is gaming systems, LOL.

Being able to get almost everything they want is exactly what consumers wanted. Retailers thinking of making a change to compete with Target should recognize that the fear of health and safety could be substantially reduced after a vaccine. Long-term changes based on temporary problems need to be thought out. The pandemic had a weird impact on marketing fundamentals: since one-stop shopping brands e. Other brands like Sears have tried this before, and were eventually bypassed by newer, more focused brands that better met the needs of their specific target group.

A clear brand promise that solves a key problem of a well-defined core customer will remain fundamental to business success. View Results. Skip to main content. Braintrust "Target should not do itself a disservice and place all the credit on underlying trends. Sort by: newest oldest most voted. Lisa Goller Content Marketing Strategist.

Richard J.