Target Plans to double revenue growth in its third-party markets, media networks and same-day delivery services said in a New York City investor meeting that plans to double its revenue growth by more than $15 billion.
The retailer plans to grow its business and better compete with competitors like Walmart and Amazon as Target finds itself in a difficult position, working hard to increase sales of high-profit discretionary merchandise and regain its competitive advantage.
Target’s shares fell more than 5% earlier on Tuesday after the company released its fiscal fourth quarter earnings and told investors that it said it had lost more than 5% earlier on Tuesday Soft sales in February. As of Monday’s end, the company’s shares fell nearly 11% this year.
In a speech to investors and analysts by CEO Brian Cornell, he touted the company’s plans to grow its third-party markets. The strategy removed a page from Walmart, which has mimicked Amazon’s model to boost revenue. Both old retailers are turning to digital sales, as well as unlimited supply from third-party sellers – as more consumers shop online, they exhaust new stores, becoming a path to growth.
Target said in a press release that it plans to “significantly expand its market size” and increase third-party digital sales from approximately $1 billion in 2024 to $5 billion in 2030. However, it seems more interested in bringing household names like Peloton, Daily Harvest and Honest Baby Clothing to the platform rather than it seems more interested in compared to private private commerce and private businesses.
As part of these plans, it will also double the size of the in-house media company Roundel from 2030 to 2030. This is another strategy deployed by Walmart, which has turned to its own in-house advertising platform, Walmart Connect, which is one of its novel growth paths.
Cornell said that besides these irrelevant businesses, the company will double its criticism of retail fundamentals as it lags behind retail fundamentals: fresh products, remodeled stores and better stocks.
“There are some eternal truths in retail. One of them is that retail is about products, and the best product of best value wins,” Chief Operating Officer Michael Fiddelke said at the conference. “When you find the great combination of novelty, style and value of your goal, we win.”
Having a wide range of fresh products is key to Target’s success and has long been its main competitive advantage. Fans of the company say a person won’t go into the target store with a shopping list – they discover new products when they buy the essentials they need.
Over the past few years, Target has seen a disposable sales lag when it grew up at Wal-Mart, suggesting that its classification is the problem rather than the larger macroeconomic problem.
To address this, Target plans to expand its gaming, sports and toy classifications and improve its family choices, another key high-margin category for the company.
It will also be with celebrity chefs like Ann Kim to grow its own brand through the new Good & Chart Consops through part of its dedicated record label brand. The goal plan plans to launch 600 new food and beverages in Good & Chat and Hause Day, another dedicated brand, and revamp its pet supplies brand, Boots & Barkey.
The company aims to fix its clothing supply chain to reduce the time it takes to design, procure and acquire products on the shelves so that it can respond faster to trends and better compete with Chinese e-retailers such as Shein and Temu.
It plans to invest $4 billion to $5 billion in stores, supply chains and technologies to reduce shares outside and implement new delivery methods to increase delivery speeds. It will say in a press release that these investments will include modernization of old inventory management systems using “AI-driven technology solutions.”
“We know that if you can’t find the item you’re looking for because we don’t have stock, or we’re not happy with your store, there’s no Tarzhay Magic,” Fiddelke said.
It also plans to open 20 new stores, most of which will be in large formats, and invest in remodels throughout the fleet.
