Target Pushes Back with New Brands, Remodelled Stores and New Services.
Target CEO Brian Cornell, the former CEO of Sam's Club, arrived to lead the Minneapolis retailer just four years ago. He has piloted the company through a crisis field of icebergs that would have felled many leaders. Cornell has been a proponent of moving faster and becoming more agile.
The rapid shift to online, as well as other changes to shopping habits, has been a huge challenge for many retailers. A large number of store closings and bankruptcies took place in the market last year. Target’s sales, which had been in a slump, are beginning to lift. The company saw growth of 3.4 percent in November and December.
“We put a premium on speed and agility, but we also want to make sure we’re making the right choices,” Cornell said during an interview at Target’s bustling Nicollet Mall store, which has a sleeker look following a $10 million makeover.
“We now have more of the proof points in place and we can accelerate. I think there’s been a great sense of urgency for four years now,” he said. “The difference is we’ve been very disciplined. I use the term ‘surgical’ in testing and validating before we roll things out.”The Q4 Financials Reports have drawn criticism from some analysts. Cornell and other top Target executives revealed more of their strategic road map at the analysts meeting this morning. The CNBC report earlier today discusses this criticism in some detail.
“They have an ambitious agenda,” said Mark Miller of BlueView Investment, who has been following Target for two decades. “They’re starting to see payback from some of their initiatives. The challenges haven’t gone away, but they’re now able to speak more to” how they’re addressing them.
While the retail outlook is looking much brighter this year, Cornell said it will still be difficult for retailers who aren’t investing in their stores, employees and online infrastructure to make it.
“There’s really no place for poorly run and highly leveraged retailers in this environment,” he said. “I think we’ll continue to see some of those retailers unfortunately close stores and potentially move to bankruptcy and liquidation. But for well-run retailers, I think there are significant opportunities in front of us.”
In December, Target bought Shipt and will add home delivery along with curbside delivery to Target stores this year. Shipt features one hour delivery from local grocery stores to your home. The ability to add delivery will help Target compete with the biggest threat to Target's sustainability, Amazon Prime.
