Digital drives Target sales growth

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Digital drives Target sales growth

By Dan Ochwat - 04/23/2020

Target released updated financial numbers that reflected a boom online but a dip in-store.

The retailer reported on April 23 that quarter-to-date, total company comparable sales increased more than 7%, but within that there was a slight decline in physical store sales and a lift by more than 100% in digital channels.

Quarter-to-date, total company comparable sales increased more than 7%, up more than 100% digitally.

Going even further into the numbers, three categories saw double-digit increases in same store sales: essentials (up 20%), food and beverage ( up 20%), and hardlines (16%). The retailer’s home brand saw a slight decline and the apparel and accessories business saw a big drop by more than 20%. The retailer has recently rolled out a few new own brands in apparel with All in Motion as well as in home with an expanded Threshold line and luggage.

The latest numbers from Target are an expansion of what the retailer reported a month ago and expounded further by saying around the middle of March, stock-up shopping by consumers during the COVID-19 pandemic fueled both online and in-store shopping in food and beverage categories. For that month, comparable-store sales rose in the low double digits, reflecting mid-single-digit growth in stores and more than 100% in Target's digital channels. Across the Target’s merchandise assortment, March comparable sales increased approximately 40% in both essentials and food and beverage categories, and by 20% in hardlines. Apparel was done more than 30%.

Target said April began to see similar sales trends than March but picked up mid-month and beyond. So much so that while comparable sales rose by more than 5%, reflecting a same-store sales drop in the mid-teens, it was carried by a whopping 275% increase in digital comparable sales.

In April, apparel and accessories continued to see a big hit, down more than 40%.

Target also announced it would be extending its $2 an hour temporary wage increase through May 30 and continue its extended benefits around the coronavirus pandemic with paid leave for members over 65 years old, pregnant or with underlying conditions, bonuses and more.