Redesigning Retail

Take a look inside Target’s new store layout, made to improve the shopping experience and win new customers.

Stop us if you've heard this one before, but traditional retail businesses have encountered their share of hurdles in recent years (like declining sales and rising digital competitors). As ecommerce continues to win over shoppers, retailers are searching for new ways to bring consumers back to brick-and-mortar stores.

For Target, the solution to win new customers—and keep existing ones—was a $7 billion pledge in 2017 aimed at reinventing the in-store shopping experience. That starts with an overhaul of over 1,000 of its 1,839 stores by 2020. No two stores will look the same as Target considers locations, what locals shop for and how they shop. But common design themes run throughout.

For example, some remodeled stores have two entrances catering to different types of Target shoppers: those who need to get in and out (shopping list in hand) as quickly as possible and those who wander around with some time and cash to burn. The "ease entrance" has a beer and wine shop, grab-and-go food items, self-checkout stations and a designated pickup desk for online orders, while the "inspiration entrance" leads shoppers to what Target calls "the river." It's a curved path that runs through the entire store, with elevated displays of products, designed to be viewed from multiple vantage points, in the center.

"Instead of having a wide aisle that is just straight, this curves around and with each curve, there’s a place where product is set showing guests how things work together, how they could build a basket of items and how they might fit in their own lives," explained Jacqueline DeBuse, public relations and executive communications representative for Target.

The retooled store layout is also a move to accommodate the growing number of online orders Target is seeing. Digital sales were up 41 percent from Q1 to Q2, while every store now offer same-day pickup in stores.

Life after death

While a lot of people have speculated about the "death of retail," the National Retail Foundation, a trade organization that includes department stores, grocery stores and chain restaurants, is optimistic that nimble stores can remain relevant.

"Ecommerce is growing and that is important, but it’s not the whole story," Katherine Cullen, director of retail and consumer insights for the foundation, explained. "We know that physical retail and the in-store experience is still really critical to consumers." The foundation originally projected 2018 sales to increase between 3.8 percent and 4.4 percent, year over year, but recently bumped that projection up to 4.5 percent.

To succeed, modern retailers have to balance a few things: online and in-store sales strategies and customers' need for convenience and engagement. They also have to fix pain points in the customer journey. "A lot of the innovation we have been tracking in the physical retail space today has been on addressing that issue of convenience and providing a seamless experience," Cullen said. For Target, that meant adding self-checkout stations and separating the returns center and online pickup area to shorten wait times.

Some retailers, according to Cullen, have moved popular items to the front of the store so guests don't waste time hunting for what they need; others have cleaned up their aisles, bringing the ease and comfort of online shopping to real-life shopping.

Target's answer to stoking convenience and engagement is speciality stores within the store. There's the food and wine shop, a built-out grocery space and a revamped beauty department. Target's pushing heavily into the $455 billion beauty industry, adding eight brands (150 products) in April, including a range of options for women with darker skin tones.

Look up, because even the light fixtures play a role here. Beauty products are backlit to make them stand out on crowded shelves, while grocery items are brightly lit to look appetizing to hungry shoppers. Floor designs also change from department to department.

Travis York, president and CEO of strategic marketing firm GYK Antler, believes other retailers will emulate Target's strategies. "The reality is that there are going to be empty retail storefronts in major urban areas all over the place," he said, "and the first retailer that figures out how to have a modern brick and mortar retail experience is going to win."