There are a number of stories this morning using the occasion of Target opening a small urban format in New York City to examine the company's broader strategy, which the Wall Street Journal writes is to open "smaller stores in urban areas and college towns from New York City to State College, Pa., as it battles declining traffic and sales at its nearly 1,800-strong fleet of largely suburban stores."
CEO Brian Cornell says that there could be "hundreds of these. It could be a huge part of future growth outlook over time.” And, he says,the new stores should start "moving the needle" for Target in 2017 and 2018: “It brings us into neighborhoods where we don’t exist today and where there is demand for our brand."
"Target is attempting to succeed where others have struggled, a sign of the limited options for brick-and-mortar retailers competing with e-commerce," the Journal reports. "Wal-Mart Stores Inc. retreated from a similar experiment earlier this year, closing more than 100 of its smaller Wal-Mart Express locations to focus on its massive SuperCenters and grocery-store-style Neighborhood Market formats. Unlike Wal-Mart, which opened its Express stores largely in suburban and rural locations, Target is focusing on densely populated urban areas and customizing the assortment in each store to cater to local tastes."
In a related story, MarketWatch reports that industry analysts believe that Target has to figure out its food offering if it really wants to be competitive, that "without compelling food offerings, there are limits to Target’s competitive upside and its ability to claw back, soon, the ground it has lost the past year."
CEO Brian Cornell says that there could be "hundreds of these. It could be a huge part of future growth outlook over time.” And, he says,the new stores should start "moving the needle" for Target in 2017 and 2018: “It brings us into neighborhoods where we don’t exist today and where there is demand for our brand."
"Target is attempting to succeed where others have struggled, a sign of the limited options for brick-and-mortar retailers competing with e-commerce," the Journal reports. "Wal-Mart Stores Inc. retreated from a similar experiment earlier this year, closing more than 100 of its smaller Wal-Mart Express locations to focus on its massive SuperCenters and grocery-store-style Neighborhood Market formats. Unlike Wal-Mart, which opened its Express stores largely in suburban and rural locations, Target is focusing on densely populated urban areas and customizing the assortment in each store to cater to local tastes."
In a related story, MarketWatch reports that industry analysts believe that Target has to figure out its food offering if it really wants to be competitive, that "without compelling food offerings, there are limits to Target’s competitive upside and its ability to claw back, soon, the ground it has lost the past year."
- KC's View:
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I am mildly dubious. I've been in a couple of these small-format Target stores, and to me they seem a little vanilla. I can see how they might be effective, but it is hard to envision them as the engine that can help generate greater growth for Target ... they look to me more like something that would power a lawn mower, not a race car.
