Source: The Mercury News
It’s no news that for many years, Target was one of the largest retail successes in the world. It was extremely well known as cheap and chic, and was even commonly referred to as “Tarjhay” by many shoppers. Unfortunately, Target is now less frequently thought of as cheap or chic in comparison to some of the other competing retailers out there. Because of this, Target’s sales have taken quite a hit over the last year. In fact, the retail chain recently reported that, for the first time in two years, it experienced a decrease in sales. In addition, it saw a 13% decline in it’s stock.
Rather than closing stores left and right like many other struggling retailers are doing, though, Target decided to try to succeed where other stores have failed -- by opening in new and different locations! Sounds a bit counterproductive, right? But, it’s not! Why? Because,Target made the decision to switch from big-box stores to small-box stores when opening their new locations.
Target has opened several smaller stores already, all of which are located in small urban areas or college towns. Each of these stores is typically less than 50,000 square feet, which is quite a bit smaller than the average Target store of 145,000 square feet, and significantly smaller than the SuperTarget stores of 175,000 square feet. Some of the new Target store locations include:
Tribeca neighborhood in NYC
Near Penn State University
Near the University of Minnesota
Since nearly 1,800 stores in largely suburban areas experienced a decrease in traffic, sales, and stock over the past few years, the popular chain decided to try something new. The stores in these areas are focused and geared toward a specific population, based on who primarily lives in the area. For example, the new stores in college towns stock their shelves with academic supplies, twin-size sheets, mini ironing boards, ping-pong balls, and beer. On the other hand, the Tribeca neighborhood store in NYC sells a wide selection of groceries, clothing, kids’ toys, and baby items to appeal to the many families living in the area. Logically, this NYC location doesn’t have an automotive section.
Target senior group vice president, Tony Roman, explained that the smaller store concept “allows us to get into those dense neighborhoods where we couldn’t put a large typical store.”
“We could see hundreds of these,” Chief Executive Brian Cornell said about the new, small, and focused stores. “It could be a huge part of future growth outlook over time.” Cornell plans to increase the total number of these small, focused stores by 30-60 stores by this time next year.