Target to invest in extra payroll hours during the shortened holiday season

With one less weekend between Thanksgiving and Christmas this year, Target CEO Brian Cornell said every day will count more than ever this holiday season, with no expected sales lull in the middle of the season as is often the case in other years.

That is one reason why the Minneapolis-based retailer is investing an additional $50 million to increase employee hours and training to keep up during the busier and shorter holiday-shopping season this year. It will beef up staffing during peak hours on the weekends to assist customers and will double the number of employees working on fulfilling online orders in stores.

"This will be our single biggest investment in holiday payroll ever," Cornell said at the company's annual holiday preview in New York, though he did not specify how much of an increase this was over last year.

Target had previously disclosed plans to boost holiday hiring this year to more than 130,000 seasonal workers, about 5,500 more than last year. At the same time, Target has been steadily increasing the minimum wage for its hourly workers, lifting it a dollar to $13 an hour in June, and has committed to raising it to $15 an hour by the end of next year.

While other retailers are experimenting with bringing robots onto the sales floor, Cornell said customers won't see that in Target stores anytime soon. "The human touch still really matters," he said.

This year, there are six fewer days between Thanksgiving and Christmas. In other years when there is a longer gap, there is usually a pause in shopping activity between the surge over Black Friday weekend and then the final rush to Christmas. But with a more compressed season this year, Cornell said he expects sales to be more steady throughout.

"I think we're going to see a very consistent rhythm and drumbeat," he said. "You're going to see bigger and stronger days through the holiday season."

Meanwhile, Walmart is responding to the shortened holiday season this year by holding its earliest holiday savings event this weekend — an online sale that launches at midnight Friday with deals on electronics, gaming, toys and sporting goods.

A couple of weeks ago, Best Buy guaranteed "Black Friday pricing" to members of its rewards programs for an annual sale of some high-end TVs and home-theater systems. The Richfield-based electronics chain also said earlier this week that most customers are now eligible to receive free next-day delivery on thousands of items.

Target's annual holiday promotion of free shipping on any size order, waiving its typical $35 minimum, starts Nov. 1 and goes through Dec. 21. The retailer said many of the orders will arrive in one day. Last year, it offered free two-day shipping during the holidays for the first time.

Target will offer 10,000 new or exclusive toys this holiday season, more than double the amount compared to last year. Target has been focusing on its toy business in the last couple of years to try to pick up some of the market share from the bankruptcy of Toys 'R' Us.

During the holidays, Target will also lean into its new loyalty program, Target Circle, which in addition to providing 1% back on a member's next shopping trip, will offer special deals and early access to some Black Friday doorbuster deals. Cornell said 25 million customers have already signed up for the program in the first couple of weeks since it launched nationwide, which he said made it the fastest growing program in the industry. Target's popular Cartwheel savings tool has also been embedded into Target Circle.

Target will also more heavily promote its in-store pickup service, Drive Up, and same-day delivery services through Shipt in its holiday marketing this year.

Last year was Target's best year of sales growth in a decade, as Target's store remodels, new private-label brands and enhanced online offerings paid off. The company has also benefited from the bankruptcies and store closings of other retailers.

Cornell said the momentum has continued into 2019 and he expects it to continue during the holidays.

"We're in a better position going into 2019 than we've ever been before," he said. "We're prepared for an exceptional holiday season."

Kavita Kumar • 612-673-4113