Target is rolling out Starbucks curbside pickup across the country as it looks for sales jolt

Target is rolling out Starbucks curbside pickup across the country as it waits for a sales shake-up

The goal is to add Starbucks beverages and food for pickup in stores across the country. The big retailer wants to boost sales as shoppers spend more on experiences and buy fewer clearance items.The company will report quarterly earnings next week.

Target is looking to boost sales by adding Starbucks beverages and food to its in-store pickup service across the country.The wholesaler said Wednesday it will expand the offer to its more than 1,700 stores, which have Starbucks coffee shops and the Drive Up curbside pickup service. That's the vast majority of its nearly 2,000 locations. The company said it will begin the chain-wide rollout this summer and have the new feature in stores by October.

Target has been experimenting with ways to sweeten the shopping experience and deepen customer loyalty, especially as consumers buy fewer over-the-counter items and prioritize spending on experiences like concerts and dinners. Its strategies include discount sales, opening more Ulta Beauty mini-stores, debuting returns and investing in faster shipping. Target has a licensing agreement with Starbucks. Target employs baristas in its stores.

The retailer began testing a Starbucks street pickup service in some stores in the fall. This feature allows shoppers to pick up a coffee drink or other Starbucks menu item when picking up groceries, a birthday gift, or any other pick-up order they placed online.Target said it has proven popular. Brown sugar iced espresso with oat milk, birthday cake pop and iced caramel macchiato topped the list of most ordered items.

Target's Drive Up pickup service has helped fuel the company's e-commerce and sales growth during the Covid-19 pandemic. The company's annual revenue grew about $31 billion, or nearly 40%, from the fiscal year that ended in January 2020 to the fiscal year that ended in January 2023. The company declined to say how much Starbucks increased sales and footfall at its nearly 250 stores. where she tested with reference to a quiet period before reporting revenue.

However, according to Target, curbside pickup has led to more business. Customers who try Drive Up for the first time end up spending 20% ​​to 30% more at Target than before, the company said. That explains why Target has added more features and more curbside pickup items, including beer and wine.

But Target has had a rocky stretch over the past year. In its most recent fiscal year, it beat Wall Street profit expectations in three of four quarters as it dealt with a glut of unsold inventory and a bigger-than-expected price cut.Target will report its fiscal second-quarter earnings next Wednesday. The company said in May that it expected slower sales to continue even as its profit margins improved.

It forecast that comparable sales for the fiscal year would range from a low-single-digit decline to a low-single-digit increase. Target said its full-year earnings per share will be between $7.75 and $8.75.Shares of Target are down 12% this year, trailing the S&P 500's roughly 17% gain over the same period. The company's shares closed at $130.98 on Tuesday, down about 1%.

Starbucks has been diversifying its store formats in recent years as customers spend less time lingering in coffee shops and more time ordering from their phones or in drive-thru lanes. The coffee giant has opened cafes dedicated to mobile ordering with open windows and inside Amazon Go branches.Placing coffee shops in grocery stores and Target stores boosts Starbucks' sales and drives traffic to those retailers, even as their customers cut back on visits and spending, then-Starbucks CEO Howard Schultz said in February.

In an exciting development for coffee enthusiasts and convenience seekers alike, Target is taking its customer experience to the next level by introducing Starbucks curbside pickup services across the country. The strategic move comes as Target looks to boost sales and offer a hassle-free solution to caffeine cravings. Let's dive into the details of this partnership and how it aligns with today's consumer demands.

Convenience tailored to Starbucks

Target's collaboration with Starbucks to introduce curbside pickup services is a prime example of adapting to evolving consumer behavior. As the demand for convenience continues to shape retail experiences, this alliance caters to the fast-paced lifestyles of today's on-the-go customers.

Time efficiency: With curbside pickup, customers can skip the lines and save valuable time. This is especially appealing to those with busy schedules or needing a quick caffeine fix during their shopping spree.Contactless Convenience: Due to recent global events, contactless services have gained paramount importance. Starbucks street pickup at Target not only minimizes physical interactions, but also ensures a safe and hygienic experience.

Personalized orders: Whether you're a fan of the classic caramel macchiato or prefer an adventurous cold brew with vanilla sweet cream, the outdoor room pickup service lets you customize your orders just the way you like them.Seamless integration: Target's user-friendly mobile app allows customers to effortlessly place their Starbucks orders in advance and pick them up without any hassle. This integration of technology and convenience epitomizes modern shopping experiences.

Sales support and customer loyalty

Target's decision to expand Starbucks street pickup services nationwide is not only a testament to their commitment to increasing customer satisfaction, but also a strategic move to increase sales. The aroma of freshly brewed Starbucks coffee wafting through the store could potentially entice shoppers to indulge in the delicious treat while shopping, thereby boosting impulse purchases and overall sales.

Additionally, this collaboration fosters a sense of loyalty among customers who associate Target with the added benefit of easy access to their favorite Starbucks beverages. A loyal customer base can prove to be an invaluable asset in today's competitive retail environment.

As Target implements Starbucks curbside pickup services across the country, it embraces the changing dynamics of consumer preferences while strategically increasing its sales potential. This partnership not only provides customers with a seamless and convenient coffee experience, but also shows how two retail giants can join forces to offer a truly remarkable shopping journey. So, whether you're on the go or just strolling down the aisles, you can now pick up a delicious Starbucks drink at your nearest Target store.