Target's 'Shipt' Delivery Service To Compete With Amazon
MINNEAPOLIS (WCCO) -- Target has a new plan to compete with Amazon.
Starting Thursday, it's launching a new, same-day home delivery service.
Late last year, Target bought Alabama based Shipt delivery service for $500 million. Since then, the company has been aggressively hiring shoppers who will begin making home deliveries at 8 a.m. March 1.
The service will cost $99 a year for unlimited deliveries of over $35. For smaller orders, there will be a $7 delivery fee.
Target COO John Mulligan said, "Everybody in the Twin Cities Metropolitan area will be able to take advantage of same day delivery starting tomorrow morning," Target COO John Mulligan said.
The new Target delivery service will include more than just groceries -- the service will include delivery of items from other categories including toys, household items and some electronics. Target says clothes will not be included right now, but will at a later date.
Here's how it works: Consumers order what they want via the Shipt app, a shopper as then purchases your items and delivers them to your door.
Shipt has worked with other grocery stores since 2015, and this month it rolled out service in Target stores in the southeastern U.S.
Shipt has been hiring 4,000 shoppers to meet what Target believes will be strong demand in the Twin Cities. While Target is predicting a smooth rollout, analysts say the stakes are high.
"It's a big gamble," Professor George John of the Carlson School of Management said. "If they don't get a lot of people to sign up, it's nice to have, but it's not going to make much of a difference."
Target says its plans eventually to expand the service to Targets throughout Minnesota and the rest of the country.
While the regular subscription price is $99 a year, if you sign up by tonight, you can get the discounted price of $49. Target Red Card holders also get that discounted price for that first year.
