Fortune has a story about how Target is addressing a persistent out-of-stocks problem by "shrinking the variety of sizes, flavors and even brands on store shelves to reduce the complexity of its operations."
The story says that Target management "is deploying workers to pore through the many categories of products it sells to see how many different formats and pack sizes of products like bottled water or soap it really needs to stock in its stores."
And the Washington Post has a story about how the company is looking "to transform Target’s logistics operations to speed delivery of online purchases while keeping store shelves better stocked. The plan involves looking at issues including big changes in how it will use its warehouses to fulfill online orders and seemingly small details such as ordering the optimal-sized packs of each product so they are easy for workers to unload on shelves ... This year, Target will be working to improve its assortment of fresh grocery items, in particular. But Cornell told reporters Wednesday that executives are doing an item-by-item evaluation 'from the grove to the shelf' on how to make sure customers see fresher food at Target."
CEO Brian Cornell says that the rationale is that Target needs to focus on variety and selection in the categories where it differentiates itself, and scale back in less-important segments. But he also says the company will not take a "blunt instrument" approach to the culling, but rather will conduct single-store tests and roll the cuts out as long as consumer reaction isn't negative.
It is an approach similar to one being adopted by Walmart, and expected by a number of CPG manufacturers that believe consumers actually are frustrated by too much choice.
The story says that Target management "is deploying workers to pore through the many categories of products it sells to see how many different formats and pack sizes of products like bottled water or soap it really needs to stock in its stores."
And the Washington Post has a story about how the company is looking "to transform Target’s logistics operations to speed delivery of online purchases while keeping store shelves better stocked. The plan involves looking at issues including big changes in how it will use its warehouses to fulfill online orders and seemingly small details such as ordering the optimal-sized packs of each product so they are easy for workers to unload on shelves ... This year, Target will be working to improve its assortment of fresh grocery items, in particular. But Cornell told reporters Wednesday that executives are doing an item-by-item evaluation 'from the grove to the shelf' on how to make sure customers see fresher food at Target."
CEO Brian Cornell says that the rationale is that Target needs to focus on variety and selection in the categories where it differentiates itself, and scale back in less-important segments. But he also says the company will not take a "blunt instrument" approach to the culling, but rather will conduct single-store tests and roll the cuts out as long as consumer reaction isn't negative.
It is an approach similar to one being adopted by Walmart, and expected by a number of CPG manufacturers that believe consumers actually are frustrated by too much choice.
- KC's View:
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I've always believed in this ... that one should offer variety where it really matters, and provide a curated approach to products where appropriate. The ability to provide vast selections online actually can relieve physical stores of that responsibility, and actually free bricks-and-mortar units to take a more differentiated and customized approach to the products and services they offer.
It is a matter of balancing effectiveness and efficiency, and adopting an approach that doesn't just present a copycat strategy.
