“We’ve seen an incredible response from guests since we first debuted our shop-in-shop experiences. … [+]
Target disappointed Wall Street in the third quarter 2022, as expertly reported by fellow Forbes.com contributor Sharon Edelman.
Yet, when Apple
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Following a 15-year relationship carrying Apple products, Target announced the launch of dedicated Apple at Target shop-in-shops in 17 stores last February that has now expanded to more than 150 locations.
The shop-in-shop concept offers a more personal shopping experience serviced by Target tech consultants trained by Apple. And the spaces are set off with special lighting fixtures and customized Apple product displays.
Apple at Target shop-in-shop
At the time of the original announcement, Christina Hennington, executive vice president and chief growth officer at Target said. “This new model was created with Target’s guests in mind, and we’ll continue to learn and enhance the experience through future rollouts later this year.”
Learn they did, and now the Apple collaboration includes expanded Apple services for Target Circle loyalty members, including a four-month free trial of Apple Fitness+. In addition, members have access to special offers for other Apple Services, such as Apple Music, Apple Arcade, Apples News+ and iCould+, some including up to five months free service.
Open For Collaborations
Apple joins these other leading brands beating a path to Target’s door:
- Ulta Beauty, starting with about 100 locations in 2021 and adding 250 more this year, Target aims to broaden the reach to some 800 stores. Of note: beauty was a standout performer in the third quarter, yielding double-digit growth and Hennington reported that Ulta Beauty at Target nearly tripled sales volume over a year ago.
- Levi Strauss added 300 shop-in-shops this year bringing its total to 800 locations, with the company reporting, “After nearly a decade, our partnership with Target is stronger than ever.”
- Disney has over 200 shop-in-shops after opening 50 more this year where it features a range of Disney offerings, including exclusive Marvel Black Panther merchandise.
- Starbucks now operates in some 1,300 out of Target’s 1,900 locations. This year it tested drive-up services in selected stores and has expanded services to more than 200 stores for the holidays. It allows customers to place advance Starbucks’ order via the Target app with a Target drive-up team member delivering the order to the customers’ car.
In addition, Target has an exclusive multiyear agreement with FAO Schwarz, dedicating shelf space in all its stores, plus carrying FAO offerings online. In addition, select Target stores will feature toy demonstrations throughout the holiday season and staffed by Target “toy experts.”
While Target didn’t provide details about its partnership agreements, it’s got a long 20+ year history in brand collaborations, starting with the 1999 partnership with architect Michael Graves. That led to over 175 designer partnerships, including Phillpe Starck, Proenza Schouler, Zac Posen, Missoni, Lilly Pulitzer, Marimekko and many more.
Laser-Focused On Guests
“Our guests are at the center of all of our decision-making,” a Target spokesperson said in response to my question about how it chooses brand partners like Apple.
“When thinking about how to enhance our shopping experience, we always start by asking what we can do to meet their needs. One way we do that is by seeking partners and actively collaborating with them to enhance the way we serve our combined guests in stores and online, and bring them merchandise and experiences that grow their brand love with all they can accomplish on a single trip to Target.”
“Our Target shop-in-shops with popular brands like Apple, Disney, Levi’s and Ulta Beauty help us deliver on that mission by providing guests access to prestigious and beloved brands all in one convenient place in-store or online, with all the benefits of shopping at Target.”
Apple did not respond to a request for comment, but fellow Forbes.com contributor Steve Denning provides insight in a seminal article well worth a read about why innovative, consumer-focused Apple left tech-giant IBM
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“As Apple CEO Tim Cook said when asked about Apple’s soaring stock price, ‘The stock price and revenues and profits are a result of doing things right on the innovation side, on the creativity side, focusing on the right products, treating customers like jewels, and focusing on the user experience.’”
Target shares Apple’s commitment to treating its guests like jewels and is rewarded with the same die-hard customer loyalty that Apple enjoys.
“Because of the deepening level of trust we’ve established with our guests over the last several years, our top line continues to benefit from growth in guest traffic and new share gains across all of our core categories,” CEO Brian Cornell said in the recent earnings call.
“And it reinforces the value of having a balanced multi-category portfolio, which allows us to satisfy our guests’ ever-changing wants and needs,“ he continued.
Always Innovating
And distinctive among its competitive cohort, Target constantly innovates its products, services and experiences around the customers’ evolving needs. Particularly noteworthy is how Target is investing in new store formats to make shopping there better for guests and the environment.
Its stores now act as fulfillment hubs for its digital business, which more than doubled over the past two years. Order pickup, drive-up and same-day delivery through Shipt now account for more than half of its digital sales and more than 10% of overall sales.
Fulfillment services are further enhanced by a “backup item” functionality that allows guests to select secondary backup items should their preferred first-choice not be available at the local store.
The demand for its stores to fulfill more digital orders is partly behind the company’s new store strategy that includes a super-sized 150,000 square-foot store that is 20,000 square feet larger than the average. The prototype just opened outside Houston and will be the model for new stores as well as future remodels.
“With our reimagined store design and larger store footprint that better supports our same-day services, we can give guests more of what they love while incorporating features that build on our commitment to sustainability and community,” John Mulligan, executive vice president and chief operating officer said in a statement.
The new store design includes more natural light and natural design elements, such as reclaimed wood, community-localized design features, expanded team and backroom fulfillment spaces and sustainable features, including rooftop solar panels.
Some 23 new store locations planned for 2023 will include many of the new design elements, though their sizes will range from 19,000 to 145,000 square feet. In addition, more than half of its 200 full-store remodels coming in 2023 will include them too.
And the new expanded footprint will provide more space to display a wider range of merchandise and possibly more shop-in-shop partnerships. Of particular interest is expanded food and beverage offerings, which also enjoyed double-digit growth during the last quarter.
Coming this holiday season is a partnership with famed British department store Marks & Spencer, noted the world over for its Food Hall experience. It will be providing Target an exclusive curated selection of gourmet premium food and chocolates.
Here’s hoping this partnership is a huge success, and a Marks & Spencer Food Hall shop-in-shop experience might be coming to a Target store near me soon.
