Target's Shipt expands to all major product categories
- Target is expanding its same-day delivery through Shipt to include all major product categories by 2019, according to a company blog post celebrating the one year anniversary of the $550 million acquisition. The same-day delivery service will also add "hundreds" of new jobs at its headquarters in Birmingham, Alabama.
- A Target spokesperson did not expand on specific timing or SKU count of the assortment expansion. Shipt currently offers same-day delivery on more than 55,000 groceries, essentials, electronics, toys and other products.
- The move means apparel and home goods, among other categories, will soon be available for same-day delivery. That said, grocery is the most popular category so far, according to Target, which added that shoppers tend to buy fridge staples like eggs, milk and bananas.
Over the last year, Target has quickly scaled the four-year-old startup from 70 markets to 200, bringing the service now into 46 states. That makes good on a promise the retailer made earlier in the year to offer the service at most stores in all major markets by the holiday season.
Without a doubt, that expansion has sharpened Target's convenience appeal, and that's showing in the numbers. Since the acquisition, Shipt membership has tripled year-over-year, and the company has hired more than 375 employees, Target said. A yearly membership to Shipt costs $99 a year or $14 a month. That compares to Amazon Prime's $119 annual fee.
Target has doubled down on delivery options this year on its quest to become "America's easiest place to shop." A year and a half ago, CEO Brian Cornell announced a $7 billion investment to modernize brick-and-mortar and digital operations. That's included the rollout of eight new private label brands and the opening of 28 new small format stores in 2018 alone. Those efforts are also beginning to pay off with customers. In August, foot traffic jumped 6.4% – which Target at the time said was the strongest traffic since the company began reporting traffic 12 years ago.
Target also notched its best comps in 13 years in the second quarter, and in the third, digital sales grew 49%. "It's our stores that are enabling our digital growth and strategy," CEO Brian Cornell told Retail Dive at a media event in October. Stores have also become an increasingly important piece of speedy last-mile delivery. Many urban small format stores, for instance, now offer in-store shoppers delivery for a flat fee. These efforts are only expected to increase as Target continues to smooth the lines between digital and physical shopping.
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