The plan? Introducing Target Circle 360, a new paid membership program that bears a striking resemblance to Walmart's own membership offering. Think perks like free, same-day delivery.
Will this be the saving grace for Target's plummeting sales? It's anyone's guess. Pinpointing the exact reasons behind the company's woes is no easy feat. While top executives attribute declining profits to inflation and reduced consumer spending, let's not overlook the fallout from their LGBTQ merchandise fiasco.
That certainly took a toll on sales, much like Bud Light's ill-fated partnership with the LGBTQ community—a move that proved disastrous for the beer company.
From Eat This, Not That:
Target plans to debut this new paid service, called Target Circle 360, on April 7, according to a March 5 press release. Those who join can receive free same-day deliveries from Target's delivery service, Shipt, and its retail partners for orders over $35. These deliveries will include no fees and could reach your door in as little as an hour. Members will also have access to free two-day shipping.
The service isn't all that different from similar paid memberships offered at competing grocers. The paid Walmart+ program launched in 2020, for example, gives members access to unlimited free deliveries, gas discounts, and Scan & Go technology through the Walmart app. Similarly, Amazon Prime memberships give shoppers access to free deliveries and other services.
The Target Circle 360 announcement comes as the retailer continues to fight a trend of declining sales. Target CEO Brian Cornell told CNBC's Becky Quick in November 2023 that the company had seen seven consecutive quarters of declining sales for items like clothing and toys. He attributed the trend to consumers cutting back on spending as they continued to struggle with inflation.
Target's latest earnings report for the fourth quarter of 2023 and the full year, released on March 5, showed that its sales woes aren't over just yet. The company's full-year sales decreased by 1.7%, its first annual sales decline in seven years, per the Associated Press. Though Target beat sales expectations for the recent holiday season, the grocer said it expects to see same-store sales decline between 3% and 5% during the first quarter of 2024.
