Target Takes Big Risk In Race To Modernize
MINNEAPOLIS (WCCO) -- Experts say Target is risking more to take on companies like Amazon and Walmart.
The Minneapolis-based retailer announced Tuesday its offering free two-day shipping with no membership required.
Amazon has created fierce loyalty among shoppers who spend $99 a year for a Prime membership. It includes free shipping on all of products and streaming movies and music.
Target recently acquired Shipt, a company which offers same-day delivery service on grocery store items, also for $99 a year.
Recent numbers show more people are choosing Target after a few bumpy years. Marketing Professor George John has studied Target's strategy for years.
"They were in survival mode, they've come out of that, they've sort of stopped the bleeding," John said. "Now they are trying to find ways to get you in the store more."
Target released this list of new offerings Tuesday:
It is an idea that intrigues graduate student Marko Doder.
"I think I would be interested because it would save me time and I order online and pick it up," Doder said.
He also likes same-day shipping, but busy mom Kathryn Spotts is not convinced.
"I don't think I would use it," Spotts said. "I have Amazon Prime and I can get things same day and I don't because I don't need anything that quickly. And if I do, I'll just run into the store."
John said time will tell if Target's plan will pay off.
"I think the early returns look good," he said.
Another change Target made is what they pay their employees. Minimum wage will increase to $12, and then to $15 by 2020.
Professor John said this kind of move is rather typical when an economy is doing well.
