Target, $TGT, CEO has said that customers are saying ‘a big thank you’ for locking up merchandise
Target, $TGT, CEO has said that customers are saying ‘a big thank you’ for locking up merchandise.
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During a media call discussing Target's fiscal third-quarter earnings, CNBC raised the question of whether the retailer could quantify the sales impact from customers frustrated by the need for employees to unlock cases in-store. Target CEO Brian Cornell responded that the customer response to the policy has been positive, sharing recent experiences visiting stores on the East and West Coasts. According to Cornell, customers expressed gratitude for the policy, as it ensures availability of the brands they seek. He emphasized that being in stock is crucial for customers, and they appreciate the changes made to enhance product safety and maintain inventory levels. When asked specifically about any measurable decline in sales or traffic due to the inconvenience of waiting for items, Cornell stated that, in many cases, the opposite is true. The emphasis on being well-stocked resonates with customers, and they understand the adjustments made to ensure product safety and availability during their in-store shopping experiences.
Despite the positive customer response, Target has faced challenges related to theft impacting its financial performance. The company has attributed profit losses to stolen items, particularly in the context of stagnant sales growth post-Covid. Target's response to theft includes the closure of nine stores in areas like New York City, the Bay Area, Seattle, and Portland during the third quarter. Like other retailers, Target has opted to secure certain items in locked cases in stores where theft is a prevalent issue.
Target's decision to implement such security measures comes after significant investments to enhance the overall shopping experience, including store renovations and initiatives like "Drive Up." While these efforts aim to provide convenience, the challenge of theft persists. Coresight Research's August survey indicated that 26% of consumers would consider shopping elsewhere, and another 26% would shift to online shopping if their local store adopted measures such as locking up items. Some customers have voiced frustration on social media platforms about the inconvenience of waiting for store employees to unlock cases to access products.