Retail Turmoil Means Stores Must Innovate Faster
Since the relaunch of its website six years ago, Target has furiously pushed itself to become a retailer that seamlessly blends its store operations with e-commerce. The company has spent more than $1 billion on digital services. It has opened an innovation center and a showroom dedicated to Internet of Things products in San Francisco, created mobile apps and experimented with augmented reality. But for all of its money and energy, there is a sense that Target is still not moving fast enough. “It’s time to accelerate the transformation of our business model,” Chief Financial Officer Cathy Smith told analysts on a March conference call to discuss the company’s poor financial performance in 2016. More than two decades after online giant Amazon made its debut, brick-and-mortar retailers are still trying to figure out how to integrate their core store business with the Internet, even as new technologies — drones, virtual reality, robots — continue to pop up. Companies like Target and Macy’s, which have invested considerable time and treasure to reinvent themselves, are finding in-stores sales are declining faster than they can innovate and adapt. “We all know the industry shift has begun to accelerate, and we believe that rate of acceleration will only continue to increase,” Target CEO Brian Cornell told analysts during the earnings call. Read more at San Francisco Chronicle.