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· Target is offering fresh grocery products via in-store and curbside pickup
· Target Is Following Walmart Into This Huge Market Opportunity
Target is offering fresh grocery products via in-store and curbside pickup
Daniel Keyes, Business Insider
Jun 29, 2020
The retailer announced that it's starting to offer 750 fresh grocery items through its Order Pickup and Drive Up services.
Target previously only offered fresh grocery products online via delivery from its subsidiary Shipt, but now it's bringing the products to pickup services at 400 stores by the end of June and over 1,500 of its 1,871 locations by the holiday season. Target temporarily paused plans to introduce fresh grocery products to Order Pickup and Drive Up in March as it adjusted to the effects of the coronavirus pandemic.
This change addresses Target's chief weakness in online grocery, helping it compete in the space as it takes off. Because fresh groceries weren't previously available via Target's pickup services, online grocery shoppers may not have relied solely on Target for their grocery needs.
This could have pushed them to...
Target Is Following Walmart Into This Huge Market Opportunity
By Jeremy Bowman, International Business Times
Target (NYSE:TGT) shares have surged in recent years, and one strategic decision is a major reason why.
The big-box retailer has invested heavily in same-day fulfillment service, including Order Pickup, Drive Up, and same-day delivery with Shipt. Sales from same-day fulfillment services jumped 90% last year and accounted for three-quarters of its 29% comparable digital sales growth.
Those services have emerged as a competitive advantage for the retailer, separating it from flailing mall-based chains and department stores and warding off competition from online retailers like Amazon. Not surprisingly, Target is investing further in the channel, as it's clearly resonating with customers. It was a big reason why digital sales jumped 141% in the pandemic-stricken first quarter -- in fact, same-day services jumped 278% in the period. Now Target is stepping up its offering by making fresh and frozen groceries available through Order Pickup and Drive Up.
Target said that after a successful pilot in the Twin Cities and Kansas City, it would roll out the expanded offering to more markets in the Midwest, reaching 400 stores by the end of the month with a goal of hitting 1,500 stores by the end of the year, about three quarters of its store base. Target will make 750 fresh and frozen items available, and COO John Mulligan said, "The speed and convenience of our fulfillment options are unmatched across the country, and they've become even more critical for our guests searching for easy and safe ways to shop during the pandemic. By adding fresh grocery to the pickup services our guests already love, we're giving them even more reasons to shop at Target."
Target isn't the first retailer to make such a move, of course. Curbside pickup has become popular at supermarket chains like Kroger during the pandemic, but no company's put more effort behind online grocery than Walmart (NYSE:WMT), and the retail giant has seen some impressive results.
Walmart's U.S. e-commerce sales have increased by about 40% in each of the last three years, and its online grocery initiative is a big reason why. The company now has about 3,300 stores offering grocery pickup, and another 1,850 with same-day delivery. That expansion has helped consistently deliver comparable sales growth and increase market share in grocery. The service, which Walmart offers for free like Target will, has been a key differentiator for the retail giant. According to a survey from Escalent, 47% of online grocery shoppers ordered from Walmart in March and April, significantly more than any other competitor.
Target's next move ...