MINNEAPOLIS (WCCO) — Target’s new strategy to bring in customers hit the bullseye.

The Minneapolis-based retailer reported big growth in its stores, with its second-quarter report well beyond Wall Street’s expectations.

“Overall retail sales of the economy is up somewhere north of 5 percent, so that’s your bench mark,” said Carlson School of Management Professor George John.

Target surpassed that benchmark, announcing 2018 second quarter sales increased by 6.5 percent. That is the best for retailer in 13 years.

“If you look at the economy, it’s all turned around this last year and you are starting to see those resolves in individual store results,” John said.

He says the country’s thriving economy is behind a lot of the sales growth that retail stores like Target are seeing. John also wants to give Target credit for re-investing in its stores.

“Even if the economy grows and you are a retailer and you don’t have your policy, you don’t get the sense of what the retail customer wants, you can get left behind,” John said. “Competition is ferocious, so I give them all the credit for re-investing their business which is in store sales.”

Loyal Target customers say they notice the changes inside the stores.

“I think Target just retails better than anybody,” said customer Thomas Wegner. “When you go in that store and you think everything’s sexy, you just want to buy, you have to have something even though you didn’t know you needed it.”

Customer Jean Koeller suspects the renovations have been tailored to increase sales.

“They lay things out differently so you can’t go straight to the cash register anymore,” Koeller said. “You have to zig-zag through and buy five other things you don’t need.”

John says Target’s main challenge is online. In order to compete with giants like Amazon, Target must stay relevant, refresh stores and their merchandise. He says you can bet Target will try to work magic on how to get its online sales up. He expects this earnings trend to continue thru the end of the year.

Reg Chapman

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