During Target’s first-quarter earnings call last month, Kathryn A. Tesija, EVP, Merchandising and Supply Chain, discussed the company’s ongoing exploration in the digital space. A perfect example of that, she said, is Target’s first-quarter launch of Cartwheel.
To drive traffic and sales in this environment, Tesija said it's more important than ever to provide value to customers on a “high quality differentiated assortment delivered through a convenient shopping experience.”
In the digital space, she explained, “we continue to apply a test-and-learn approach when rolling out applications and capabilities so we can determine what works best for our guests. We are pleased that our digital traffic grew faster than industry benchmark again this quarter. We continue to explore ways to integrate digital technologies with social media and our stores to provide a unique shopping experience for our guests.”
Target’s beta launch of Cartwheel was developed in collaboration with Facebook. Tesija described Cartwheel and what it offers customers.
“This first-of-a-kind experience gives guests a fun way to save on hundreds of items throughout our stores,” she said. “Upon authenticating this application through their Facebook profile, guests receive 10 spots to fill with deals of their choice. Depending on the product, the deals feature a range of discounts and expiration dates, and guests can switch between offers at any time.”
Tesija said deals are redeemed at store checkouts either by scanning a single barcode on a mobile device or a printout from a desktop computer. Guests can share Cartwheel with their friends on Facebook to show off their latest finds and see what their friends are buying. The more guests interact with Cartwheel by choosing and redeeming deals and sharing those deals with friends, the more offers they unlock for themselves.
“We launched Cartwheel in beta, and we’re encouraging guests to provide feedback so we can make ongoing real-time enhancements to the Cartwheel experience,” Tesija explained. “Initial signups to Cartwheel have exceeded expectations. Thousands of guests signed up in the first week, and we saw a meaningful increase when we added a link to Cartwheel on Target.com. More than 10% of guests who have signed up already have redeemed Cartwheel offers in one of our stores.”
Target also launched a Beauty Box test tin the first quarter to understand its guests’ appetite to pay for samples of beauty products.
“We tested this offer on Target’s Facebook style page and sold through our inventory within a week,” Tesija said. “Te offer generated favorable media coverage and positive feedback in social media. Based on these results, we will continue to explore ways to surprise and delight guests with box-based offers that support our Expect More, Pay Less brand promise.”