Target will discontinue curbside pickup

June 1, 2016 01:30 PM

Target Corp. plans to kick its curbside pickup service to the curb.

A spokesman for Target, No. 22 in the Internet Retailer 2016 Top 500 Guide, confirmed the retail chain will suspend its curbside pickup program in mid-June. Target began testing the service in January 2015 in 11 stores in California, eventually expanding the pilot to 121 stores nationwide.

“At this time Target is focused on making sure we deliver and execute on retail fundamentals,” the spokesman says. “That includes devoting more efforts and resources to enhancing some of our core digital-stores offerings—such as (mobile coupon app) Cartwheel, (in-store) order pickup, and shipping online orders from stores.

Target worked with mobile app Curbside to enable consumers to set a time for picking up an online order outside a Target store. The move appeared to catch Curbside off guard.

“It was a bit of a surprise,” says Curbside co-founder and CEO Jaron Waldman. “We saw that curbside service there was something consumers really, really loved and it was successful by almost any measure.” Waldman declined to provide further specifics as to what made the pilot successful.

Paula Rosenblum of consulting and research firm RSR Research LLC says a couple of things could have factored into Target's decision to decide to stop offering curbside pickup.

"I have to assume they didn’t have enough of a market for it because I can’t imagine it’s that costly," she says. "It is probably a distraction for store associates though, especially if uptake is sporadic."

On its website, Curbside claims retailers using the app see a 30% gain in customers on average, with 61% of all shoppers who use the app making repeat purchases. In April, the company signed drugstore chain CVS Caremark Corp. (No. 102) as a client, helping the company launch CVS Express. CVS integrated Curbside’s technology with its own mobile app so that shoppers in three markets—Atlanta, San Francisco and Charlotte, N.C.— can pick up over-the-counter medications and orders that don’t include prescriptions for free in as little as an hour.

On Target’s Q1 2016 earnings call on May 18, chief operating officer John Mulligan reiterated the company’s desire to strengthen the connection between online and offline.

“A key area of focus in our stores is the elevation of our digital order pickup, and the team is taking steps to make the process more convenient and less transactional for our guests,” he told analysts on the call, according to a transcript from Seeking Alpha. “Our goal in these efforts is to increase satisfaction with the order pickup experience leading to more repeat usage of this capability by our guests.”

Target is a finalist for the Omnichannel Retailer of the Year Award at the 2nd annual Internet Retailer Excellence Awards, which will be announced June 8 at the Hyatt Regency McCormick Place in Chicago as part of the Internet Retailer Conference & Exhibition.




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