Earlier this year, Target launched Target Restock, an online service through which consumers can order certain merchandise for next-day delivery. Pilot-tested in Minneapolis, the program was recently expanded to the Dallas, Texas and Denver, Colorado markets and the number of available items doubled, to about 15,000. While it’s still early in the game, brick and mortar retailers can already learn three things from this initiative.
1. Don’t be afraid to experiment with new programs and services.
There’s no denying that Target had previously ventured into the online channel before introducing Target Restock. For example, consumers have been able to order from its website for several years. The retailer had also long offered an “order online, pick up in store” option. However, it had never delved into next-day delivery.
Still, management was willing to give the new service a try, setting an example for others who might be more reluctant to try something new. To make things easier in case your endeavor doesn’t produce the expected results, do what Target did, and start small. The retailer tested the same-day delivery program first with employees and in the Minneapolis area before deeming it ripe for expansion.
Don’t be discouraged and give up if your service displays glitches or if you encounter other bumps along the way. Instead, identify and address pain points. Target initially limited participation in Target Restock to holders of its REDCard credit and debit cards. But when this didn’t prove viable, it opened the program to all consumers.
Similarly, a Saturday delivery option was added in response to customer demand and to broaden the program’s appeal. New categories of products, such as baby food and school supplies, became available. Originally, customers could use the service to order household, beauty, personal care, and dry grocery items only.
2. Watch the trends.
Target didn’t introduce next-day delivery in a vacuum. Rather, it looked at what its competitors were doing before making its move. Target Restock is Target’s answer to Amazon’s Prime Pantry and Prime Now services, which also offer next-day delivery of household essentials, and dry grocery, personal and beauty care items.
The service is also designed to sharpen the retailer’s competitive edge against Walmart, which has made inroads in same-day grocery delivery and pickup. It can even be considered a move to level the playing field with third-party players like Peapod and Instacart, which work with local supermarkets in the same-day grocery delivery arena.
In watching trends, see what you can do to “best” your competitors. Amazon Pantry charges $5.99 per delivery, but Target Restock customers pay a flat fee of $4.99 to ship orders weighing up to 45 pounds.
3. Plan carefully.
You’ll need an online channel and a strong online presence to emulate Target’s online move. If you don’t have these, find out how to get onboard by reviewing this blog.
It’s also important to have the right systems and technology in place. Customers will demand a seamless, hassle-free experience, so start by making your ordering system feature-rich. The Target Restock website features a capacity tracker that indicates the weight of orders being built in real time, so they don’t exceed the limit.
Additionally, ensure that your point of sale (POS) and inventory management systems provide you with a single view of what’s in stock and what you’re selling in all channels. Finally, follow Target’s lead by giving customers a way to track orders online.
Now more than ever, retailers must be creative to stand out from the crowd. Taking a leaf from Target’s book with new services and using the lessons outlined here, is a great start.
