Ahead of holiday shopping, Target expands free two-day shipping

NEW YORK – Once upon a time, in a retail land far away from Amazon.com, the holidays were about hot new fashions, the snazziest toy or the gotta-have-it techno gizmo.

These days, it's about how fast stores can get their wares onto your doorstep or into the trunk of your car, without you having to pay extra.

Target Corp. on Tuesday made a big move in the holiday shipping wars, offering free two-day shipping on most of its products with no minimum purchase or membership fee.

While it has offered free shipping in the past, it's the first time the Minneapolis-based retailer has a no-strings-attached offer with such a quick turnaround. The deal will run between Nov. 1 and Dec. 22.

All retailers are adjusting to changing consumer tastes, where shoppers now use their phones and computers to buy everything from consumer staples like paper towels to products that once were showroom-only items, such as mattresses or bulky furniture.

Walmart has a free shipping offer with all purchases over $35 and announced an expansion of that service on Tuesday. Amazon offers it for Prime members at an annual fee of $119.

As part of a $7 billion overhaul of operations, the retailer will use the holidays to gain promotional punch out of its array of shipping, delivery and pickup options through an advertising campaign it is calling "run and done."

"It's all about making it easier for guests to shop on their terms," Target Corp. CEO Brian Cornell told reporters during a holiday and strategy briefing at its offices in Manhattan.

Target said its drive-up service will have expanded to nearly 1,000 stores by the end of October. Most orders are ready within an hour and, by using a mobile phone app, products are delivered to shoppers' cars within two minutes of their arrival in the parking lot, the company said.

The retailer said it also has expanded its use of the same-day grocery delivery service to 46 states via Shipt, a personal shopping company Target purchased last year for $550 million. It also now offers day-of delivery for a $7 fee in five urban markets: Boston, Chicago, New York, San Francisco and Washington, D.C.

"Retailers are doing whatever they can to make it convenient," said Ken Perkins of RetailMetrics. "Theoretically it looks like it'd be simple, but it's a big change to reconfigure stores. It's annoying if you have to walk to the back of the store. Or wait in line."

Target plans to hire more seasonal workers than any other retailer — about 120,000 — to pull off the array of delivery options. Cornell said Tuesday that the retailer is on pace to get needed staffing despite one of the tightest labor markets in a decade.

The company received more than 100,000 applications after a mid-October hiring blitz in stores, he said.

Cornell said Target won't unilaterally match Amazon's announcement that it would start all workers at $15 an hour. Target will stick to a previously announced timeline to hit the $15 hourly mark by 2020, but he added that the company continues to pay competitive wages on a market-by-market basis.

Target's three-year, full-scale modernization of its operations includes remodeling its stores in ways that shoppers see, such as bigger displays of toys and the beauty aisles, and in significant ways that they don't, including dedicated workers behind the scenes who are bundling up items pulled from store shelves by "pickers."

Some of the items might get set aside for customers to pick up. Others will get rushed out to the car at a special drive-up, boxed up for door-to-door delivery or shipped out for delivery.

The moves are an effort to match or best its strong performance in the fourth quarter last year, with comparable sales rising 4 percent, the best performance since 2014.

Target is still paying attention to its merchandise. The retailer said Tuesday it has added 1,400 new and exclusive gift and holiday offerings, including more toys and many items under $15.

However, "fulfillment" has become the new competitive retail front, and mass merchandisers such as Target must try to keep their assortment fresh while also figuring out how to meet consumers' expectations for speedy delivery at a low price without cutting too deeply into profit margins.

They're trying to get shoppers like Molly Sikora of Edina coming back for the basics as well as special gifts.

Sikora said she's a big user of Amazon and many of Target's newer services. Among her favorites: Target drive-up.

"It's so much easier with kids," she said last week, as 2-year-old Luke looked on and 4-year-old Sarah gave an impatient tug to her pant leg.

Jackie Crosby • 612-673-7335