Target is using a completely rebuilt tech department to transform its e-commerce sales. At current growth rates, Target will become one of the top 10 retail e-commerce companies by next year. Sara Castellanos reports for The Wall Street Journal:
To be sure, Target’s financial performance isn’t solely tied to its technology efforts. The company has refurbished stores over the past few years and it has debuted new brands that are attracting customers, said Neil Saunders, a managing director with GlobalData PLC. “The most important thing is to have products people want to buy,” Mr. Saunders said.
But Target’s technology efforts have been critical in making shopping easier and more appealing—whether online or in store, he said. Those efforts require a degree of nimbleness and the ability to respond to changing consumer trends quickly. “Having an in-house team allows you to do that,” Mr. Saunders said.
Target hasn’t yet made market research firm eMarketer’s list of the top 10 U.S. companies ranked by retail e-commerce sales. However, this year it will likely overtake shopping channel QVC as the nation’s 10th largest e-commerce retailer based on its growth trajectory, eMarketer said. QVC’s retail e-commerce sales in 2019 amounted to an estimated $7.10 billion, or 1.2% of total U.S. retail e-commerce sales, according to eMarketer. Amazon.com ranked first with an estimated $222 billion in retail e-commerce sales, or 37.6% of the total.
The in-house IT team was critical in integrating the technology systems of Target and Shipt Inc., a grocery delivery startup the company agreed to acquire in 2017 for $550 million, Mr. McNamara said. Same-day delivery options, including Shipt and “buy online pick up in store” services, accounted for 80% of Target’s digital growth in the company’s most recent quarter.
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