“We dropped back several years ago and started thinking about building the target of the future,” says Target CEO Brian Cornell. “It really started with an investment in understanding the consumer and really understanding what they were looking for and how to build the capabilities starting with data science to really guide us through that journey. Whether that’s technology or supply chain capabilities, product design, or our focus on execution at the store level, data and analytics have been important guideposts for us as we’ve gone through this journey.”
Brian Cornell, CEO of Target, discusses the details of how the company is building the Target of the future in an interview at the Stanford Graduate School of Business:
Reimagining Stores and Investment in Technology is Paying Off
Target’s (current success) is really a combination of a number of things that we’ve been working on for several years now. If I go back to February of 2017 we laid out a three-year vision for the company. We said we’re going to invest billions of dollars. At that point, I said $7 billion dollars over a three year period to invest in reimagining our stores, in building new smaller stores and urban centers and on college campuses, reinvest in our brands, invest in technology and fulfillment capabilities, and make a big investment in our people.
The success we’re seeing right now is really a combination of all those elements starting to mature. We’re executing at scale and they’re all starting to work together. That’s driving for us great top-line growth, market share gains, and importantly more traffic in our stores and visits to our site.
In Most Cases Shopping Starts With the Mobile Phone
I actually think blend (of digital and physical) is the right term. I think from a consumer standpoint they’ve really lost sight of whether they’re shopping in a physical environment or a digital environment. In most cases, their shopping starts with that mobile phone in their hands, that digital device. It’s how they decide where they’re going to shop and what they’re looking for. If you went to one of our Target stores this afternoon I guarantee you we’d find consumers with a phone in their hand, they’d be looking at their latest Pinterest, they’d be checking things on their favorite digital site, and they’d have their shopping list there.
That device really guides them through the shopping experience. I think more and more there’s a blurring and a blending that’s taking place and it’s a combination of both. The consumer today is enjoying the fact that shopping has become really easy. They get the best of both. They get a physical experience when they want it and if they don’t have time they can shop from their desk or from their classroom. They’re constantly in touch and we’ve made it really easy now for them to interface with our brand on their own terms.
Building the Target of the Future
We dropped back several years ago and started thinking about building the target of the future. It really started with an investment in understanding the consumer and really understanding what they were looking for and how to build the capabilities starting with data science to really guide us through that journey. I can talk a lot about strategy, but the other thing that we’ve recognized is how important it is to have the right capabilities in place. Whether that’s technology or supply chain capabilities, product design, or our focus on execution at the store level, data and analytics have been important guideposts for us as we’ve gone through this journey.
We’ve been fortunate in that we’ve recruited quite a few Stanford grads. I think what’s attracting them to our business is the richness of our data. The fact that on an average week we get 30 million consumers shopping our stores and a similar number going to Target.com. We have all this rich data and we understand where consumers are shopping, what they’re looking for, and I think they’ve been really intrigued by the ability to take that data and help us build a future.
The Consumer is Looking For a Unique Personalized Experience
I’ve certainly seen this trend towards personalization and localization. If I think about the changes in consumer packaged goods, in some cases those big brands that you and I grew up with, well they’ve been replaced by smaller local niche brands that we didn’t see when we grew up and they’re being regionalized across the country. I think the consumer today is looking for that unique personalized experience, whether they’re shopping a Target store or they’re walking through a local store right here on the Stanford campus.
I think I walked in recognizing the importance of a clear strategy for an organization. But I’ve come to realize just how important culture is, a clear purpose, and importantly ensuring that our strategy is supported by great capabilities and the importance of team. I think (as we look toward the future) we’ll still be true to the purpose we have today. It’s really focused on bringing a little bit of joy to all the families we serve each and every week and really enhancing their everyday life. I think that focus on families, that connection we have today with moms with kids with families across the country, will be as true in the future as it is today.