Target is officially in the convenience store business.
Earlier this month the Minneapolis-based mass merchant opened two slimmed-down stores in the San Francisco Bay area. The first opened in downtown San Francisco, the second across the Bay in the college town of Berkeley.
These units are the second and third “Express” stores Target has opened — the first debuted recently in Minneapolis — in a program that the retailer believes will increase the impact Target is able to exert on specific communities.
If this ambitious project comes fully to fruition, there is every initial indication that it will do just that.
These Target Express stores are, in reality, convenience stores merchandised and marketed to specific, and often unrelated, communities. The 20,000-square-foot San Francisco store is designed to attract local residents and business people by offering them an assortment of daily food and general merchandise that duplicates much of the merchandise sold in chain drug and dollar stores. The store features the products of local suppliers, products that local shoppers know, use and, reportedly, prefer.
Additionally, the assortment runs heavily to merchandise that locals are known to favor — organic and natural food, a full assortment of health and beauty products, housewares and household goods, basic apparel, a technology mix that includes a range of Apple products, and a full-service pharmacy.
The Berkeley store, significantly smaller at 12,500 square feet, is merchandised to the college students who constitute its core customer. As such, the mix is skewed toward those products students rely on, though it too offers an assortment of locally produced goods and a selection of local and organic food items, a complete H&BA mix (though not as complete as is available in the San Francisco store), a pharmacy, assortments of household products, some basic apparel, an electronics department that features Apple products, and a mix of basic housewares and grocery items.
What makes these stores particularly appealing is not their similarities, however, but their differences.
As one example, while both units offer a selection of local apparel items, the items in the San Francisco store lean heavily toward that city’s sports teams while the Berkeley assortment features products associated with teams that represent state schools and colleges. Similarly, much thought has been given to effectively highlighting the differences in merchandise between the two areas.
Even the operating hours are tailored to the individual communities the stores serve. The San Francisco unit opens earlier and stays open later, and the Berkeley store remains open on Sunday while the San Francisco store does not. Reflective of their neighborhoods, the pharmacies are open fewer hours than the stores themselves.
On the face of it, this is a remarkable enterprise. It has, as nearly as possible, suited two commonly owned stores to their individual neighborhoods more effectively than has been done in the U.S. retailing community to this point.
As an example, each of these two Target Express stores is located across the street from a Walgreens drug store. The Walgreens stores are remarkably similar in terms of size, mix and promotional and merchandising emphasis; the Target stores are remarkably different. Indeed, even the similarities mark them as different: Each of the Target stores offers customers the option of ordering merchandise online, then collecting that merchandise at the store. While this service has become common practice in retailing, it is rarely encountered in neighborhood stores.
The question, of course, is whether Target can find the discipline to roll out these Express stores in markets throughout the U.S., keeping them fresh, refining and emphasizing their uniqueness to individual markets, yet controlling them in much the way the company manages its traditional discount stores. It is an assignment that no U.S. retailer has yet executed.
But Target is not the typical U.S. retailer. Despite its occasional bumps of late, the Minneapolis-based company has amply demonstrated that it is among the elite in the U.S. retailing community, consistently delivering value to the American consumer.
Though it’s early days for Target Express, there is every reason to believe that Target will deliver on this extraordinary commitment — and so, as it has done before, transform mass retailing in the United States.