The leadership team at Target Corporation is strategically reviewing its business and has identified the key initiatives that will put Target on a clear path to growth.
The retailer's differentiation in the marketplace will be driven by stronger merchandising and a shopping experience that is centered on ease and inspiration, with mobile serving as the front door to all of Target.
The retailer will also reassert its cultural leadership to build unparalleled guest affinity. In addition, Target will create a headquarters team that is more agile, efficient and guest-focused.
To do so, the retailer is taking a channel-agnostic approach to growing its business, driving a total Target experience across stores, online and mobile.
According to a Target press release, guests who shop at Target stores and online, generate three times the sales compared to guests who shop in stores only.
Continued enhancements in technology, supply chain and inventory management will create a shopping experience that is rooted in ease and inspiration.
This will help spur Target's continued annual growth in digital channel sales of 40 per cent, as well as contribute to a total projected sales growth of 2 to 3 per cent and comparable sales growth of 1.5 to 2.5 per cent in 2015.
Style, Baby, Kids and Wellness are being prioritised and will be the merchandise categories, Target is famous for and the company will invest in these areas with a focus on newness and differentiation.
Target will create a more guest-centric experience by tailoring its assortment and offering more locally relevant products, with demographics, climate, location and other factors driving merchandising decisions.
Additionally, Target will strengthen its data and analytics and technology capabilities to deliver more personalized digital experiences, loyalty programs and promotional offers.
Target's store opening plans will increasingly focus on new, more flexible formats like TargetExpress and CityTarget, which cater to guests in rapidly-growing, dense urban areas.
Throughout 2015, the retailer will open eight TargetExpress locations across the country. In addition, the company will continue to open the right stores to fit each community and test new layouts.
Cost savings of $2 billion over the next two years are expected to fuel Target's growth and drive profitability.
According to the retailer, these savings will be realised through operations, technology and process improvements; supply chain and sourcing efficiencies; and corporate restructuring.
The restructuring will be concentrated at Target's headquarters locations and focus on driving leaner, more efficient capabilities, removing complexity and allowing the organisation to move with greater speed and agility.
This includes the establishment of centralised teams based on specialised expertise and the elimination of several thousand positions over the next two years.
This year, Target expects to invest between $2 and $2.2 billion in capital expenditures, including a $1 billion investment in technology and supply chain.
