Who says brick and mortar retail is dead?
Shares of Target stock rose more than 4.5% on Tuesday after the company posted a blockbuster earnings report for the holiday season. Stores open for the past year posted an average 5.3% sales increase, marking Target’s strongest result since 2005. It wasn’t just sales that were up—Target also reported a 4.5% increase in traffic to its stores.
“We have been driving an ambitious agenda to transform our Company, evolve with our guests and drive strong growth. On every count we’ve been successful, and as we enter 2019, we will continue to lead the industry by adapting, innovating and delivering more for our guests and shareholders,” Target CEO Brian Cornell said in a statement.
At least 25 retailers have already announced nearly 5,000 store closings in 2019, according to MoneyWise. Among those are mall mainstays including Payless, Gymboree, and Victoria’s Secret. While big box retailers, including Target and Walmart, have mostly managed to avoid the slump in traffic and sales other retailers are seeing, Target’s earnings report is another indicator that the company believes an ambitious $7 billion plan unveiled in February 2018 is working, despite the initial skepticism of Wall Street.
Early last year, Cornell announced a multi-year project to revamp Target, including remodeling hundreds of stores, speeding up improvements to its supply chain, and continuing to open smaller urban locations, complete with grocery staples, clothes, electronics, and household supplies.
“I had people shaking their heads,” Cornell told the Star Tribune last week. “You could see it.”
Target also fought to keep its prices competitive over the holidays. A temporary workforce of 100,000 employees also helped the company to cater to busy holiday shoppers.
The retailer also offered in-store pick-up, along with a “drive up” option that served as a differentiator from its competitors. The free choice, which is available in Target’s app, allowed customers to order their gifts and then pick them up in the Target parking lot, all without having to worry about finding a parking spot or braving the holiday crowds.