Target has become the new mall.
By adding store-within-a-store concepts from Ulta Beauty, Walt Disney, Apple, and others, the chain has become a fun place to browse even when you have no specific shopping goal. Add in the company's celebrity partnerships like its Magnolia merchandise from Chip and Joanna Gaines along with the various special and pop-up selections it has offered, and you can see why customers will visit even when they don't actually need to buy anything.
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The presence of Starbucks, of course, adds to the mall-like feel and it's also important to know that the chain actually thinks about delivering a positive experience for customers. That seems like something you should expect from any retailer, but many companies sacrifice in-store experience for cost and efficiency reasons.
Target (TGT) -) CEO Brian Cornell talked about those efforts during his company's third-quarter earnings call.
"For many years now, we have focused on building a durable business model that allows us to meet guests where they are, developing and enhancing the right tools and capabilities while investing heavily in our team, all in the service of providing an affordable, easy, and joyful guest experience," he said.
During that call, the company also talked about a quiet change it has made in some stores that bucks what rivals Walmart and Kroger have been doing.
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Target brings more workers to checkout
Self-checkout saves retailers money on labor. That's why Walmart (WMT) -) and Kroger (KR) -) have increased their self-checkout lanes while cutting down on human cashiers.
Target, on the other hand, has been testing changes to its self-checkout lanes. This has included making them 10 items or less and even adding more workers to man traditional checkout stations.
"Since our goal is for Target to be the easiest place for our guests to shop, our teams have been focused on the front-of-store experience with the goal of providing consistently great service through the in-store checkout experience, along with drive-up and in-store pickup," Target COO John Mulligan said during the earnings call.
He also addressed something that retailers rarely say out loud so they can use "convenience" as a justification for self-checkout.
"And because our guests tell us they enjoy interacting with our team since we've refocused on the front-end experience, we've seen more than a 6 percentage point increase in the usage of full-service lanes across the chain," he added.
Target hasn't made a massive pivot away from self-checkout, but it has opened more traditional checkout lanes in many stores.
Target takes a long-term view
"We're playing the long game, investing in our stores, our team, our digital capabilities, and our assortment to provide the newness, value, and convenience our guests want for this holiday season and beyond. At the heart of it all is our focus on being our guests' happy place and delivering the joyful shopping experience that makes Target, Target," Cornell added.
Target, like rivals including Kroger and Walmart, has to find the right mix that works for their customer base, according to Mark Ryski, who has written two well-regarded books on the retail industry.
"Self-checkout is here to stay. When it works well, self-checkout is terrific and many consumers prefer it to interacting with cashiers. The adjustments and changes that Target and other retailers are making is understandable as they all continue to refine processes to try to find the right mix for their customers," he posted on RetailWire.
DeAnn Campbell, a retail marketing and operations executive shared her thoughts with the site as well.
"The check-out is the last experience a customer will have with that retailer before they leave the store. Making it a good one will do more for repeat business and increasing future basket size than any marketing campaign," she wrote. "...Limiting self-checkout use to where it works best is always the right idea.
