Target is pushing curbside pickup service, which will cover 2,000 stores across the United States by the end of October

It is learned that according to foreign media reports, recently, US retail giant Target announced that it will expand the service scope of "Drive Up" for curbside pickup orders to boost sales.

The big-box retailer said Wednesday it will expand the service to more than 1,700 of its stores with Starbucks cafes and its curbside pickup service Drive Up by October, or the vast majority of its nearly 2,000 locations.

Target has tried a variety of ways to enhance the shopping experience and deepen customer loyalty, especially as consumers cut back on discretionary purchases and prioritize spending on experiences like concerts and dining out. The discounter’s strategy includes opening more Ulta Beauty mini-stores, rolling out curbside returns and investing in faster shipping.

Target reportedly has a licensing agreement with Starbucks, and baristas at Starbucks stores are employed by Target.

Target began testing Starbucks' curbside pickup service, Drive Up, at select stores last fall. The service allows shoppers to add Starbucks drinks and food to their order when they pick up groceries, birthday gifts or any other curbside pickup order placed online.

Customers will be able to receive a reminder to place an order from the Starbucks menu in the Target app. Once the customer completes the Drive Up check-in process and says "I'm on my way", the Starbucks barista in the Target store will prepare the coffee order. Customers simply park their car in the designated Drive Up parking area and click "I'm here" in the Target app, and Target staff will deliver the items to their car along with the prepared coffee drink.

Target's curbside pickup service Drive Up has effectively driven the company's e-commerce and sales growth during the COVID-19 pandemic. From January 2020 to January 2023, the company's annual revenue soared by about $31 billion, nearly 40%.

The company declined to say how much sales and traffic at its 250 Starbucks stores would improve, citing the quiet period before earnings reports.

Target, however, noted that curbside pickup is bringing in more revenue for the company. The company said that over the past year, customers who tried Drive Up for the first time ended up spending 20% ​​to 30% more at Target than before.

Target's revenue has been sluggish over the past year. The company has missed Wall Street's profit expectations in three quarters due to excess unsold inventory and larger-than-expected markdowns.

It is learned that Target will announce its second-quarter 2023 results next Wednesday (16th). The company said in its first-quarter earnings call in May that although profit margins have improved, sales are expected to continue to slow. In addition, it predicts that comparable sales for the current fiscal year will be between low single-digit increases and decreases; full-year earnings per share will be between $7.75 and $8.75.

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