Dive Brief:
- Target will close 13 of its 1,800 stores in the U.S., Fortune reported Wednesday.
- The retailer typically decides to close stores if the locations have seen profits slide for multiple years, according to a Target spokesperson who spoke to Fortune.
- Fortune reports that Target store cuts are usually announced around this time of year, with the plan being to close the stores, located all over the country, after the holiday season.
Dive Insight:
This move is in line with Target CEO Brian Cornell's decision to focus on stores as part of the retailer's turnaround, while cutting unprofitable parts of its business like Target's failed Canadian expansion.
The retailer is spending millions to boost its omnichannel efforts while also adding more personable services like makeup and skincare consultations to its stores. Cornell has made merchandising upgrades as well, including mannequins and lifestyle vignettes in its housing department, which have helped boost sales. Target will hire 1,400 visual merchandising experts this year to enhance its apparel and home presentations.
“We could deliver great print ads, amazing 30-second spots, but when you went to stores and started browsing or went to Target.com, all you saw was a sea of racks or a string of search results. We owed our guests a better presentation,” Cornell said during an industry summit reported by Women’s Wear Daily.
Target announced a $2 billion two year cost-cutting plan earlier this year, which slashed several thousand jobs around its headquarters in the Minneapolis area. The retailer has also made a $1 billion commitment to its e-commerce efforts as it faces growing competition from both Amazon and Wal-Mart.
