Target has made significant strides in enhancing its customer experience by investing heavily in digital technology. The retailer’s latest initiatives focus on integrating AI and other advanced technologies to improve both in-store and online shopping, as well as streamlining operations for its team members.
A key area of investment has been in AI technology, which has been embedded in handheld devices used by Target employees. This integration allows staff to quickly access best practices and receive prompt responses to common questions, significantly reducing the time needed to assist customers. Since rolling out this tool chain-wide, it has been utilized over 50,000 times, with an average response time of less than a minute.
Target also is using GenAI to elevate its digital experience for consumers, including GenAI-powered product pages and search capabilities that curate the most relevant results and make it even easier for consumers to find everything they need when shopping on Target.com.
Target says it’s on track to make an investment of $3 billion – $4 billion in its business in 2024. Target does not reveal its specific investment in digital technologies. Brett Craig is the Chief Information Officer of Target, responsible for spending on digital technologies.
Website of Target says Brett Craig leads the strategic direction and management of the enterprise technology systems that elevate Target’s guest and team member experience. Brett Craig, who joined Target in 2008, is responsible for the company’s technology roadmap and oversees Target’s global product engineering, infrastructure, cybersecurity, data sciences, and architecture teams.
“The transformative nature of GenAI is helping us accelerate the rate of innovation across our operations, and we’re excited about the role these new tools and applications will play in driving growth,” Brett Craig said.
Target’s focus on digital innovation has paid off in its online shopping channels. Target has generated online sales of $4.564 billion, representing 17.9 percent of its total revenue, in the second-quarter of 2024.
The company reported 8.7 percent growth in digital sales during the second quarter of 2024, driven largely by same-day services like Drive Up and Target Circle 360, which grew in the low teens. These services now represent more than two-thirds of Target’s digital sales, with Drive Up alone generating sales of more than $2 billion in Q2 and more than $4 billion so far this year.
Target says its guests have already made nearly 1 billion trips to Target over the first six months of 2024, indicating that investment in customer experience is yielding results. Target has reported total revenue of $25.5 billion (up 2.7 percent) and operating income of $1.6 billion (up 36.6 percent) in the second quarter. Operating income margin rate rose to 6.4 percent in Q2 2024 from 4.8 percent in Q2 2023.
The company’s efforts to enhance the checkout experience have also yielded impressive results. Target has streamlined its self-checkout process and maintained adequate staffing in full-service lanes, leading to faster checkout times and 15 percent increase in customer engagement. This has contributed to the highest Net Promoter Scores for checkout experience in six years.
Target’s digital initiatives extend beyond just customer-facing improvements. The retailer has also leveraged the data insights from its Target Circle loyalty program to offer more personalized promotions, contributing to the addition of over 2 million new members in the second quarter alone. Cara Sylvester is the chief guest experience officer for Target focusing on deepening guest engagement and attracting new shoppers.
As Target moves into the fall season, the company remains focused on affordability, offering budget-friendly back-to-school and college essentials, while continuing to refine its digital and in-store experiences. The retailer’s strong performance in digital channels and AI-driven operational enhancements underscore its commitment to deepening customer relationships and driving sustained growth.
Baburajan Kizhakedath
