Target's Digital Sales Rise 30 Percent
Web transactions accounted for one-fourth of comp sales increases, helped in part by an improved free shipping strategy.
Website sales account for 2.7% of total.
Target yesterday announced better-than-anticipated results for its second quarter, including a 2.4% increase in comparable sales at stores open a year or more. What was more surprising was that the chain's digital sales rose by 30% and accounted for 0.6% of same store sales increases.
Pepsi veteran Brian Cornell, completing his first year as Target CEO, credited traffic growth and strong sales in his outlined signature categories of apparel, baby, and wellness. But the main reason for the huge increase in Web sales, according to one e-commerce expert, was a beefed-up shipping strategy.
“Target's merchandise has always been affordable and high-quality, but I think embracing free shipping and dropping the purchase threshold to $25 has had a big effect on digital sales,” says Clarus Commerce CEO Tom Caporaso, who operates FreeShipping.com. “Target is giving the consumer what they want, and what they want is free shipping.”
Web sales accounted for 2.7% of total Target sales of $17.4 billion for the three months ended August first. During the same period last year, digital accounted for 2.2%.