Target gets its game face on with free shipping

Faith Merino · October 22, 2014 · Short URL:

The holiday slaughter begins...

Target is looking to have its Karate Kid moment this holiday season. Remember last year—something about a massive security breach that compromised the data of some 110 million customers’ credit cards? Yeah, that killed Target’s Christmas.

But you know what, Target? You’re the best, arooouunnd! No one’s ever gonna keep you down!

To give holiday sales a preemptive boost, Target has announced free shipping on—everything. Like, every—thing. The big box chain is dropping all shipping fees on orders placed between October 22 and December 20. Additionally, there is no minimum purchase amount to qualify for free shipping, which may give Target a leg up on Amazon Prime, which has relegated a number of smaller items as “add on” items when you purchase $25 or more worth of other merchandise. Meanwhile, Walmart offers free shipping on orders once they cross the $50 minimum purchase amount.

Interestingly, despite the breach last year, conversions are up 40% this year. To zero in on online customers, Target is launching a number of other digital campaigns in preparation for the holiday onslaught. On October 31, the company will launch its Wish List app, and its mobile and tablet apps will be relaunching in the weeks leading up to the holidays.

But will it be enough to make up for last year’s losses? The breach compromised Target’s credit card scanners for more than two weeks beginning the weekend of Black Friday—the busiest shopping weekend of the year—and cost the company $148 million in damages. Profits were down 41% in the first six months of its fiscal year compared to the previous year. The devastation ultimately led to the May resignation of former CEO Gregg Steinhafel.

Nevertheless, the company’s stock has remained fairly strong in spite of the attack and the subsequent upheaval. Shares are down just 5% from where they were 12 months ago.

The company believes that customers have ultimately gotten over the breach. And it’s worth reiterating that shoppers were not affected by the breach. The company hasn’t yet released its third quarter earnings, but Target’s digital sales grew 30% in the second quarter compared to the same quarter a year ago, double the industry average.

And with or without free shipping, it’s likely to see a sizable increase in the number of online shoppers it sees this year. Total e-commerce spending grew 13% in the second quarter of 2014 compared to last year, according to comScore.

So keep on fighting, Target, because…you’re the best! Aroooouuund! No one’s ever gonna keep ya down! You’re the best! Aroooouuuund! No one’s ever gonna keep ya down! 


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