Target joins crowd of big US retailers seeking store expansion | Reuters
In a surprising twist to the retail narrative, several major U.S. retail chains are reversing the trend of store closures and are now opening new locations. This shift marks a significant change in strategy, especially after years of warnings about a “retail apocalypse” due to the rise of online shopping, further accelerated by the pandemic.
Target is leading the charge by planning to open more than 300 stores over the next decade, focusing on expanding its food sections. These new stores, predominantly full-size and larger than the average 120,000 square feet, are expected to generate an additional $15 billion in annual sales. This move departs from Target’s recent strategy of opening smaller, urban locations.
Walmart is also changing its approach. After slowing down store openings since 2015 to focus on e-commerce, Walmart announced plans to build over 150 new Supercenters and smaller-format Neighborhood markets in the next five years. This expansion includes opening 30 new Sam’s Clubs, marking the chain’s first opening since 2017. Walmart, a retail giant with over $600 billion in annual sales, operates approximately 4,700 U.S. stores.
Interestingly, Walmart and Target have credited their pickup and delivery services for increased visits and sales. Walmart’s online order pickup and delivery offerings contributed to a 4% traffic increase, while Target’s “Drive-up” service helped recover significant traffic during the holiday quarter.
Macy’s is also adapting its strategy, focusing on expanding its luxury brands, Bloomingdale’s and Bluemercury, while planning to close 150 of its larger Macy’s stores, including some flagships. This shift indicates a strategic emphasis on better-performing luxury brands.
These developments suggest a renewed confidence in physical retail spaces as major chains adapt to changing consumer preferences and the evolving retail landscape…………..
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With major retailers like Target and Walmart expanding their physical store presence, how might this shift impact the dynamics between online and offline shopping experiences for consumers? Consider the potential effects on consumer behavior, market competition, and retail landscape.
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With more physical stores, consumers might have more options for in-person shopping, which can offer a hands-on experience and immediate gratification. However, online shopping will still have its advantages, like convenience and a wider selection. This shift could also intensify competition between retailers, as they strive to provide unique experiences and competitive prices to attract customers.
With major retailers like Target expanding their physical store presence might lead to more seamless integration between two, with options like buy online and pick up in- store becoming more popular. It could create more competition, as retailers strive to offer the best overall experience to attract customers.