#NRF2019: Stay ahead of the consumer with constant investment, says Target

Investment in technology is key if retailers wish to succeed in the coming years, Target’s CEO, Brian Cornell, announced to NRF 2019 delegates in NYC this week.

The Target boss said every decision a retail business makes needs to start with the consumer in order to keep up with constantly changing technologies which are impacting their lives.

He pointed to the dramatic change of the technological landscape over the last decade – when only ten years ago “nobody ever shopped from their BlackBerry”.

“All these changes feel pretty profound, our world is in a perpetual state of change.”

He added: “There’s always going to be a next generation of consumers and their preferences and behaviours will continue to evolve. Technology will only go one way – fast forward. And to stay ahead you always have to keep the consumer in the middle of every decision you make. And you have to invest and have to be willing to reinvest and have to constantly be disrupting yourself.”

Cornell pointed to the importance of reinvesting in stores, as well as fulfilment systems to keep the consumer shopping journey fresh and competitive with the likes of Amazon.

“A couple of years ago there were lots of questions about the future of physical stores, and questions about Target’s place in retail. At that time we quickly realised we were never going to win if we were playing someone else’s game,” he said. “As digital moved from a rounding error to an essential part of consumer expectation, we knew we couldn’t build distribution centres fast enough to go head-to-head with Amazon.”

Cornell explained how at the time the retailer’s online business was completely separate from its traditional store business, but it soon realised due to its vast number of stores across the US it had a competitive advantage over the eCommerce pureplay giants.

“Turns out [the stores] had a lot more potential and we reinvested in reimagining our physical stores and making them work even harder.”

After turning its stores into mini distribution centres and aligning its eCommerce and store business Target now sees three of four digital orders fulfilled by a physical store.  

He also said that having a physical store means the retailer has 350,000 people, whose job it is to look after customers.

“At Target we’re spending a lot of time exploring everything from AI to VR, but also realising there’s still no substitute for that human connection.”

He pointed to drone delivery as an example, asking delegates if they would rather have a drone dropping off a parcel on their doorstep, or a real person who knows to knock the door softly rather than use the doorbell because the house has a mum and a new baby inside?

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