Target CEO talks holiday shopping deals, smaller, urban stores
Many of the nation’s largest retailers are gearing up for Black Friday, one of the busiest shopping days of the year. Target is one of them.
“These holiday periods is when we really shine,” Target CEO Brian Cornell said Wednesday on “CBS This Morning.”
Cornell said the company spends a lot of time getting shoppers’ feedback, and they were told customers enjoy the Black Friday experience, prompting the company to open its doors at 6 p.m. Thanksgiving Day.
“It’s a big event. We see families turn out. We see brothers and sisters kind of reuniting in our stores. So we try to meet their needs,” Cornell said.
In addition to what Cornell describes as “sensational deals,” the retailer is also offering 15 percent off nearly everything online and in stores from Sunday through Cyber Monday for the first time. Last year’s Cyber Monday was Target’s biggest online sales day ever.
According to the National Retail Federation, holiday sales are expected to increase 3.6 percent this year to $655.8 billion. They also predict non-store sales to increase 7 to 10 percent to $117 billion.
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Asked whether Target is encountering an uphill battle against online retail giants like Amazon, Cornell said, “We don’t think it is.”
“We think physical stores still matter. So as we sit here today, we think about retailing in the U.S., 90 percent of the business is still done in a physical store,” Cornell said. “Now most consumers, they’re starting with a smartphone in their hand. It’s how they decide where to shop. It’s where their shopping lists are held. But they still like the physical experience. So we need to do both.”
According to Deloitte’s holiday survey, shoppers plan to spend 47 percent of their budgets in store and 47 percent online, an increase of 3 percent for online as compared to last year’s survey. Cornell said the company has been investing for years in building out online shopping capabilities, and the combination of the store and digital experience during the holidays is critical.
Target has also been building flexible-format stores in 30 cities across the country, tailoring products for the local area.
“We’re following the consumer, and what we’re seeing across the country is consumers moving back to city centers, whether it’s here in New York or in Philadelphia, Boston, Chicago,” Cornell said. “So we’re just simply following the consumer. And as we’ve talked to them, they’ve said one of the things they’d love to see is a Target in their neighborhood. And these are really neighborhood stores. We opened up here in Tribeca in Manhattan just early in October. The store has been an incredible success for us.”
The smaller, urban stores are also important for online orders’ same-day pickups, Cornell said, which are offered in 1,802 stores. Ninety percent of the orders can be ready within an hour.
While Target will get an early start on the Black Friday shopping, dozens of stores are also taking a stand against opening on Thanksgiving Day. Costco, Home Depot, Nordstrom and T.J. Maxx are among the retailers that will be closed.