Target Aims for the Bullseye

Shifting shopping habits, along with an increase in online shopping has taken its toll as the number of retail bankruptcies continues to increase. Consumers are buying more online, rendering brick and mortar stores irrelevant. This is impacting companies of all sizes: while Target is a go-to one stop shop for many, its stock price took a hit in early 2017 (attributed to low Q4 sales in 2016). As it attempts to rebound, the company announced it was acquiring Shipt for $550M in December.

What is Shipt?

A grocery delivery service, Shipt provides same-day grocery delivery service from your local grocery store. Its competitors include Instacart.

Beyond Groceries

Target’s advantage has always been the selection of products you can buy in their stores, including groceries but also covering a wide swath of other items. Through Shipt, “Target will also offer a selection of other products, including electronics and home categories, and expand that selection over time.”

What This Means For Brands

For brands already carried by Target, consumers may soon be able to buy your product online with home delivery. As this model continues to evolve, the “point of purchase” shifts to your living room and/or your smartphone and will impact the efficacy of in-store marketing. This acquisition will further push consumers to adopt online grocery shopping habits.