Target expanding urban footprint with new Chicago store

Dive Brief:

Target plans to open a 12,800-square-foot store in Chicago’s Wicker Park in July, anchoring the neighborhood’s Centrum Wicker Park apartment complex, the Chicago Sun-Times reports. It will be Target’s ninth small-format store in the area, joining existing stores on State Street and in Streeterville, Lincoln Park North, Hyde Park, Belmont Station, Oak Park, Skokie and Lakeview Ashland, Target told Retail Dive in an email.
The store, which will employ 30-50, is not yet on Target’s published list of new stores next year, though the company confirmed the plans. The "carefully tailored" merchandise will include a broad beauty assortment in a boutique-style setting; baby and kids, including basics, apparel, toys and sporting goods; men’s and women’s basics, apparel and accessories; a grocery selection for the fill-in trip, including fresh produce, grab-and-go items, snacks and meal solutions; and order pickup services, the company said.
In March, Target executives unveiled a series of initiatives designed to reverse the big box retailer’s same-store sales declines, including an investment of more than $2 billion of capital in 2017 and more than $7 billion over the next three years. The company will use about $1 billion of operating profits this year to improve brick-and-mortar and digital operations.

Dive Insight:

The fruits of Target's recent investments are beginning to show. The mass merchant has decided to remodel 325 more stores than originally planned — for a total of 1,000 of its 1,800 stores. CEO Brian Cornell told reporters at the grand opening of Target’s Herald Square store in Manhattan in October that the new stores are seeing a 2% to 4% sales rise, more than twice a typical store.

“We’re thrilled for the opportunity to serve guests in the Wicker Park neighborhood, and our small-format store design offers the flexibility to customize a Target shopping experience for local residents and commuters alike. In the coming weeks and months, we’ll meet with the Wicker Park Committee and partner with local leaders to ensure the needs of this vibrant and unique community are reflected throughout the store’s assortment and design,” Mark Schindele, Target senior vice president, Properties, said in a statement.

Cornell has said that much of the company's investment in new locations will go to adding more than 100 small format urban stores over the next three years, as well as overhauling existing locations using aspects of the retailer’s LA25 concept store that have tested well. Stores are also being reconfigured to more efficiently serve as fulfillment hubs for online orders.

In addition to new and renovated stores, Target is installing a merchandise designer at all stores in order to ensure that layouts are maximizing their appeal. Cornell's massive overhaul of Target's brick-and-mortar and digital operations is a response to what he called "a seismic shift" in the retail industry.

From bookstores to electronics stores, many retailers have registered such seismic activity well before now, notes Matt Sargent, senior vice president of retail at Frank N. Magid Associates. "Target just took longer to feel the 'Amazon digital effect' ... due to the categories and customer base they play within," Sargent said in an email to Retail Dive earlier this year.