Target has been suffering through an identity crisis as it switched CEOs and has struggled to rebuild its customer connection.
One of new CEO Michael Fiddelke’s first priorities has been to clean up the chain’s stores by simplifying operations for store managers.
“If you’re a store manager now, yes, you’re supporting your in-store guest and you’re also running a fulfillment business that’s gotten pretty big,” he told CNBC. “And I think we’re just now fully appreciating, ‘All right, we’ve got to make sure that we’re doing both really well and it’s more complex than it used to be.’”
GlobalData Managing Director Neil Saunders thinks Fiddelke has diagnosed that problem correctly.
“The main reason some of Target’s stores are so sloppy is because associates have been given more things to do without a corresponding increase in available labor hours. That means basic tasks, like replenishment and recovery, are not attended to. Removing or reducing online fulfillment from some stores will free up time,” he wrote on RetailWire.
Target also plans to make a major shift in its grocery section.
As a regular Target grocery shopper, I have always been a bit confused as to how the company saw its own offering. In some areas, it sells a selection of merchandise that rivals Walmart, Kroger, or other major grocery chains, while in other sections, it offered a more curated set of items.
Its fresh meat and fish selections were limited compared to Walmart or my local Publix, and the same has been true for produce.
Target’s Chief Merchandise Officer Cara Sylvester explained the chain’s grocery strategy during its fourth-quarter earnings call.
“We’re focused on what’s next, strengthening Target’s unique identity when it comes to food. We are not trying to be an everything grocer or just another grocer down the street. Instead, we’re building a truly distinctive grocery destination where emerging brands, wellness and owned brands intersect,” she said.
Abandoning the “everything grocer” idea means admitting that your customers will shop at rival chains, something most large-scale stores try to prevent.
Target has a different plan.
“Put another way, we’re bringing even more of our style and design authority to food for families looking for fun trend-forward options, whether it’s for lunch box snacks or a Tuesday night dinner. That’s why we’re delivering newness at twice the industry’s rate,” she shared.
“Rather than seek to convince shoppers to make it a primary destination for essentials — as rival mass retailer Walmart has done so effectively — Target is instead hoping customers will head to its stores to keep up with the latest trends,” wrote Retail Dive’s Sam Silverstein.
