Target to invest $250M in Twin Cities store remodels
Target on Monday announced it will invest $250 million this year to remodel 28 stores (about half) in The Twin Cities area, home to the company's headquarters. Those stores are just a few of the hundreds slated for a refresh, the company said in a blog post.
Target is using its updated Nicollet Mall flagship in downtown Minneapolis as a model for future stores. That store was one of 110 remodeled last year, and 325 are scheduled for this year the company said in October, although no two will look exactly the same.
Remodeled stores will include: LED lighting, solar panels, background music, a modern design aesthetic and enhanced merchandise presentations, including areas that showcase trends or seasonal products. Stores will also have features aimed to ease online ordering and pickup, including bigger Order Pickup counters and a Drive Up lane in the parking lot
Target's announcement builds on an effort to remodel more than 1,000 of its 1,800 stores nationwide by the end of 2020 — part of a $7 billion initiative announced last March that also includes the construction of over 100 small format stores. At least 18 of those will open their doors this year as well in urban, suburban and college cities.
While costly, the mass merchant is betting big on the idea that convenient, localized stores will ultimately help it win against competitors like Walmart and Amazon. With each store tweaked to fit the local community, the merchant is hoping to offer a sense of authenticity and connection. Stores with two entrances will be remodeled after the Dallas store that opened late last year, with one entrance for "inspiration" and the other for "ease."
During a tour of the newly remodeled Nicollet Mall store in Minneapolis, CEO Brian Cornell told the StarTribune the company now has "more of the proof points in place and we can accelerate."
Cornell, who has been at the helm for four years now, is expected to further detail store plans during the company's earnings announcement on Tuesday. "I think there's been a great sense of urgency for four years now," he told the newspaper. "The difference is we've been very disciplined. I use the term 'surgical' in testing and validating before we roll things out."
Target has come a long way in the last few years. An investment in stores, a revamped digital strategy and a massive private-label push have helped put it back in the game after a string of disappointing quarterly earnings reports dating back to 2015. Target was named Retail Dive's Turnaround of the Year in 2017. The company has since put in place several new executives to lead innovation, among other segments. It also recently announced a goal to expand next-day delivery nationwide, thanks to its acquisition of next-day delivery company Shipt.
"We're going to make it really easy for our shopper to interact with our brand any way they want," Cornell said on CNBC's "Fast Money Halftime report" in February. "Now with Shipt — in a couple of hours, I'll put it right on your kitchen table."