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Customer Retention. Automated

8 Technology Shifts Retailers Can Learn From

Posted by Aviva Imbrey on Feb 24, 2015 3:51:00 PM

Not always hitting the bullseye, Target is a brand the provides some retail lessons for the industry. I like to compare Target to a massive ship cruising through uncharted territory. The ship is made up of many moving parts, with large engines and areas that operate like clockwork, while other areas are designated for testing out new bells and whistles. The water is choppy and unpredictable and the climate is changing.

Target has hit a few icebergs and had to deploy some lifeboats, but all in all it takes a heck of a lot to take this ship down.

For this reason, Target is an amazing brand for retailers to learn from. As the second largest retailer in the United States, it’s surprising that it does not just duck its head down and do what has worked in the past. Through some innovation and great successes, in just over 50 years target has created the iconic brand that so many Americans adore. Although Target has seen many accomplishments, they have also steered into nasty storms, made some missteps, thrown several crew overboard and uncovered some lessons that all retailers can learn from.

The retail industry is changing rapidly. When it comes to selling products, the new tech-savvy and phone obsessed millennials are no longer shopping the way their grandparents used to. The only way for retailers to keep up with ever-changing consumer habits is to constantly evolve, therefore taking steps into new territory.

A phrase that I got used to hearing at Target was “The only thing that is constant is change.” Target did not just say this, as company decisions were made to constantly stretch and embrace the notion of change. In the last five years alone, they changed their systems in almost all marketing channels to communicate differently, the product assortments changed to appeal to the variety of ethnic backgrounds found in modern Americans, the way a pharmacist holds records for patients changed to ensure safety and that drug-interactions are monitored, and hiring practices changed focusing on how to hire someone who is adaptable and embraces that big 5 letter word. 

With IRCE coming up, I wanted to take the time to highlight a speaker who is one of those key change-makers that has brought tremendous execution in the waves of online retail for Target. Jason Goldberger, President for Target.com and Target Mobile has ramped up the transformation to the omni-channel future of retail.

In anticipation of seeing IRCE keynote speaker Jason Goldberger, here are 8 of Target’s technology shifts that every retailer can learn from. 

1. Website Overhaul

That’s right, in 2011 Target, known as a leader in technology, got a large black eye after deciding to cut ties with Amazon and start operating their own eCommerce site. This led to Target.com crashing during the Missoni launch. What happened next? A huge website overhaul led by Jason Goldberger. He should have some insights to share during IRCE about that.

2. Mobile Apps: Target App and Cartwheel App 

Target has had extreme success with their ever-expanding mobile apps. They started with the flagship Target app which provides an online store for customers, which is complete with registries, weekly sales, and pharmacy and product locators.

Cart Wheel, Target’s next major app, is all about customer loyalty savings. It has proven extremely successful and allows customers to collect coupons, win badges and scan one barcode for all the items in their carts.

3. Ship To Store & Flexible Fulfillment

This is the transition from distribution centers shipping all online orders to guests (thus keeping Target.com very separate from the stores) to allowing each store to act as a distribution center and fulfill online and mobile orders with a few hour turn around. This process also links up with mobile by allowing customers to communicate about their orders via email and mobile device.

4. Product fulfillment Technology

When you are picking up your husband from the airport and you check his flight on your phone, you can see that he is delayed and when you need to head out for his new arrival time. Iff we can do that with airplanes, why can’t we figure it out for retail? 

Target is working on a way to create this type of inventory management system, which involves real-time tracking across all stores, distribution and Target.com.

5. Mobile: Gift Registries & Pharmacy

Target has created and deployed mobile gift registries and provides ipods for those who still prefer to shop in the store. The pharmacy has also seen success in mobile messaging and prescription refills. 

6. Rx System Overhaul

The effort to streamline the operating system, improve patient safety, and provide shorter wait times did not come easily. Target rolled out Red Rx in an effort to provide a smoother operating system for the pharmacies and it failed. As a result, staff had to work harder and patients had to wait longer. This rollout was tested in many stores, cut short, and stores reverted back to the old system to start again.

The Rx system did in fact see another, more successful, overhaul leading to a more efficient, mobile, safe, and secure pharmacy. 

7. Security POS Optimization:

Target hit the international news with the data breach during the holiday season in 2013. We all remember that. It shocked the retail world with a huge “I am so glad that wasn’t my company.” Followed with a “Did I shop at Target during that time?” In all seriousness, it was a nightmare but the retail giant has invested hundreds of millions of dollars, forged partnerships with some of the leaders in information security and has come back with state of the art security systems and new procedures across all channels.

8. O Canada : The Billion Dollar Question.

Ouch! Pulling out of Canada leaves many unanswered questions and will impact and affect all areas of the business. Just the process of redistributing the product is mind numbing but the closing down of each channel will provide insights to learn from in a big way. For other retailers expanding into new markets it shows the importance of diligent localized research on product assortments, competition, pricing, workforce and cultural influence. It also sheds light on the investment needed in fully flushing out distribution networks and replenishment systems. Lastly, dip your toes in the ice water before jumping all the way in. This was the largest amount of stores opened at once, in a new market in the history of retail. That is a tall task. Taking babysteps, and ensuring processes and systems are running smoothly before mass producing can save a mistake from turning into a disaster.

“With small risks comes little reward”

For many online retailers, the risks that Target has taken over the past 5 years can be viewed as a learning experience of what to do and what not to do. Our team is excited to watch Jason Goldberger talk through some of his challenges and successes in Chicago at IRCE this June. Hope to see you there!

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