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Target’s Shipt Is a Same-Day Delivery Service That Competes With Amazon

March 1, 2018, 6:39 PM UTC

Target is ramping up its same-day delivery service Shipt.

The big-box retailer on Thursday launched Shipt in Minneapolis, allowing customers near Target stores in the Twin Cities to get their orders delivered the same day. The service will roll out to more cities in the coming days, including New Orleans and Baton Rouge, as part of a push to expand the service to most Target stores nationwide by the end of the year.

Last year, Target acquired Shipt, which offered same-day delivery for a variety of retailers, including Kroger and Costco, for $550 million. Shipt continues to serve retailers other than Target.

To use the service, Target customers pay $99 annually for an unlimited number of deliveries. Orders of $35 or more are free as part of that subscription while customers who place smaller orders must pay $7.

Shipt is the latest in a string of efforts by Walmart and Target to compete against Amazon. The e-commerce giant has attracted shoppers with its Prime delivery service, which costs $99 annually and allows for free two-day delivery. Amazon is also moving into same-day delivery in certain U.S. markets to compete with big-box retailers that offer same-day access to products.

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Still, there are plenty of customers who are willing to wait a day or two for their orders to be delivered instead of shopping in stores. To attract those customers who might not want to go to a store and top Amazon’s two-day Prime shipping, Target and Walmart are turning to same-day delivery.

In a statement earlier this week, Target said that Shipt’s same-day delivery is available for more than 55,000 products. By the end of next year, every “major” product category at Target will be included in the service.