Dive Brief:
- Target, via Shipt, will soon begin offering same-day delivery of more than 55,000 groceries, essentials, home goods, electronics, toys and other products to customers in metropolitan areas across the Midwest, including in: Illinois, Indiana, Michigan, Missouri, Ohio and Wisconsin. The service will also be available in several Kentucky cities.
- New Shipt members who sign up before June 14 are eligible to receive an annual membership for $49 (down from the regular $99) and a $15 credit to spend on Target orders of $100 or more, according to company press releases.
- The four-year-old upstart, acquired by Target for $550 million in December, has been delivering in the Midwest for about a year. The services will be available beginning on various dates in June.
Dive Insight:
In just six months, Target has acquired a same-day delivery darling and scaled the service to 91 markets. And it's on track to offer the service nationwide by the holidays, a company spokesperson told Retail Dive. That's no small feat for a mass merchant playing catch up to the well-oiled logistics machine at Amazon.
"Same-day delivery was at the top of our list when we were thinking about ways to make shopping at Target even easier," John Mulligan, Target chief operating officer, said in a statement about the expansion. "Shipt's personalized, customer-focused approach fits perfectly with our commitment to deliver a convenient, exceptional experience..."
In an effort to make Target "the easiest place in America to shop," as CEO Brian Cornell is known to say, the mass merchant has focused heavily over the last year on logistics, e-commerce, stores — and most importantly, the connection between the three. Delivery and curbside pickup, however, are areas where the retailer has lagged until recently. Acquiring time and talent have been key to getting this right. Just four months before buying Shipt, Target bought same-day transportation technology company Grand Junction (for an undisclosed amount).
These acquisitions have fueled ambitious plans in two-day and same-day delivery, which has quickly become tablestakes in the battle against Walmart and Amazon. Earlier this year, Target announced a plan to roll out free two-day shipping on orders over $35. That's impressed analysts at Cowen at least, which in a May report stated they were encouraged by the company's strategies around using the store base to drive digital momentum, as well as its array of new fulfillment options.