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Target Celebrates Strong Performance During Holiday Season

Marian Zboraj, Progressive Grocer
Target Celebrates Strong Performance During Holiday Season
Of Target’s same-day fulfillment services, Drive Up grew the fastest, at more than 500%.

By reinventing its approach to the busiest shopping season of the year, Target Corp. grew comparable sales in the combined November/December period 17.2%, driven by a 4.3% increase in traffic and a 12.3% increase in average ticket.

"The momentum in our business continued in the holiday season with notable market share gains across our entire product portfolio,” said Brian Cornell, chairman and CEO of Target Corp. “We're very pleased with our results, and the strength of our performance is a reflection of the tireless work of our team to support our guests through a safe, convenient and inspirational experience. Throughout the holidays, we delivered joy for holiday shoppers while focusing on safety adjusting promotions to reduce crowding while delivering easy contactless fulfillment options through Drive Up and Shipt.”

In regard to keeping in-store customers safe and following COVID-19 social- distancing guidelines, Target introduced its Pre-Trip Shopping Reservations to allow holiday shoppers to see whether there was a line outside their local store, and if there was, they could digitally reserve a spot in line.

To entice its shoppers in advance of the holiday season, Target revealed that it was rewarding its nearly 80 million Target Circle members with more ways to save. From Black Friday Now to last-minute shopping, the retailer offered guests nearly 1 million additional deals throughout the holidays, compared with last year. And for those last-minute shoppers, Target conveniently made its contactless pickup and delivery services available until 5 p.m. on Dec. 24. 

As a result of its efforts, Target was able to grow its store-originated comparable sales by 4.2%, while comparable digital sales grew 102% during the 2020 holiday season.

Comparable digital sales growth was driven primarily by the retailer’s same-day fulfillment services (Order Pick Up, Drive Up and Shipt), which together grew 193%. Of the services, Drive Up grew the fastest, at more than 500%, while Target's sales fulfilled by Shipt grew more than 300%.

The retailer's same-day pickup and delivery have become essential services. In December alone, guests purchased 150 million items using Drive Up and Order Pickup — almost four times more than during that time frame last year. Cyber Week 2020 was also Target’s biggest yet, with record-high digital orders, site traffic and orders fulfilled via its Drive Up service.

Between store-originated sales, same-day services and the company's ship-from-store capability, approximately 95% of Target's sales in the November/December period were fulfilled by its stores. 

Additionally, Target continued to gain market share throughout the holiday season in all five of its core merchandising categories. Growth was the strongest in home, which saw a comparable-sales increase in the low 20% range. Comparable sales in hardlines also grew in the low 20% range, reflecting mid-20% growth in electronics. Apparel delivered comparable-sales growth in the high single-digit range. In food and beverage, comparable-sales growth was in line with the company average, while beauty and essentials saw growth in the low teens.

Target said in November that it was embarking on a "strategic long-term partnership to transform the beauty landscape" by installing Ulta Beauty shops in Target stores. The “shop-in-shop” concept will offer established and emerging prestige brands online and in at least 100 select Target locations nationwide in 2021.

"We've seen continued strong sales trends in the new year, and as we turn to our 2021 plans, our team is focused on continuing to build on the guest engagement and significant market share we gained throughout 2020," noted Cornell.

Minneapolis-based Target Corp. is No. 7 on The PG 100, Progressive Grocer’s 2020 list of the top food and consumables retailers in North America, with approximately 1,900 locations. Bolingbrook, Illinois-based Ulta Beauty operates 1,264 stores across 50 states.

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