Tar­get sets sights on col­lege crowd

Smaller new stores near cam­puses cater to stu­dents

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM - KAVITA KU­MAR

MIN­NE­AP­O­LIS — In the age of on­line shop­ping, Tar­get is try­ing new ways to con­nect with col­lege stu­dents while also bring­ing stores closer to cam­puses as it opens new smaller-for­mat lo­ca­tions.

“How we’re reach­ing col­lege stu­dents has changed and is evolv­ing,” said Joshua Thomas, a Tar­get spokesman. “As con­sumers are chang­ing, so has our strat­egy and how we can ser­vice stu­dents.”

For more than 15 years, the Min­ne­ap­o­lis-based re­tailer has played host to af­ter-hours shop­ping events re­plete with DJs and school mas­cots in which they bus tens of thou­sands of stu­dents from cam­puses to Tar­get stores around the coun­try.

This fall, Tar­get is par­ing back the num­ber of bus­ing events as it tries sev­eral other strate­gies to reach col­lege stu­dents, an in­creas­ingly im­por­tant de­mo­graphic for its growth strat­egy.

It is test­ing a new ser­vice called “Shop Now, Pickup Later,” a spin on the buy on­line pickup in store pro­grams that many re­tail­ers, in­clud­ing Tar­get, have be­gun of­fer­ing in re­cent years.

In the col­lege-fo­cused pi­lot pro­gram, stu­dents at six uni­ver­si­ties in­clud­ing Ari­zona State Univer­sity and the Univer­sity of Ne­vada- Las Ve­gas can order on­line from a cu­rated list of about 300 items such as sheets, lounge chairs and mini-fridges and then pick them up weeks later around move-in time at a des­ig­nated spot near cam­pus. “No need to haul it all

from home,” Tar­get said on its web­site in pro­mot­ing the pro­gram. “Have those big bulky items like fur­ni­ture, bed­ding, appliances and more de­liv­ered close to cam­pus.” At the same time, Tar­get is re­shap­ing its mar­ket­ing out­reach to stu­dents as it opens more stores right on the edge of cam­pus. In July, the com­pany opened four more such stores. At two of them, lo­cated near the Univer­sity of Cincin­nati and Univer­sity of North Carolina, the re­tailer will of­fer com­pli­men­tary rides to the stores in late Au­gust and early Septem­ber through a part­ner­ship with Gotcha Ride, which runs free shut­tles on some cam­puses through cor­po­rate spon­sor­ships. In ad­di­tion, Tar­get is ex­per­i­ment­ing with a two-day pop- up shop right on the North Carolina cam­pus, bring­ing items like dorm­room decor, light­ing and stor­age units closer to stu­dents while also pro­mot­ing the new nearby store. Col­lege stu­dents, a typ­i­cally bud­get- strapped de­mo­graphic, were once over­looked by re­tail­ers. But these days, re­tail­ers in­clud­ing Tar­get and Ama­zon are in­creas­ingly court­ing them. The hope is that they will be­come life­long cus­tomers. “Head­ing off to col­lege is a pretty piv­otal life mo­ment,” Thomas said. “We see it as an op­por­tu­nity to es­tab­lish our­selves in new ways or deepen our affin­ity with them.” And it’s a grow­ing mar­ket. Fam­i­lies are ex­pected to spend a record $54 bil­lion, up from $48.5 bil­lion last year, on back-to-col­lege pur­chases this year, driven in part by higher col­lege en­roll­ment, ac­cord­ing to the Na­tional Re­tail Fed­er­a­tion. Ama­zon has opened more than a dozen cam­pus lo­ca­tions in the last cou­ple years where stu­dents can pick up and re­turn or­ders as mail­rooms get more over­whelmed with pack­ages from on­line or­ders. It also gives col­lege stu­dents Prime mem­ber­ships for half off the nor­mal price af­ter an ini­tial six month free trial pe­riod. Tar­get has iden­ti­fied col­lege cam­puses, par­tic­u­larly those with en­roll­ments of more than 20,000, as a key mar­ket to open its small­er­for­mat stores, which are also be­ing placed in dense ur­ban and sub­ur­ban ar­eas where its larger stores don’t fit as eas­ily. It started test­ing the wa­ters in 2014 with a 20,000-square­foot store — about a sixth the size of its typ­i­cal big-box store — it opened near the Univer­sity of Min­nesota. Tar­get has since opened stores near Bos­ton Univer­sity, Univer­sity of Mary­land, Penn State and Univer­sity of Cal­i­for­nia at Berke­ley. In July, it fol­lowed them up with new stores near the Univer­sity of South­ern Cal­i­for­nia and the Univer­sity of Cal­i­for­nia, Irvine. The lat­ter is sit­u­ated right next to a pedes­trian bridge that about 10,000 stu­dents cross every day and fea­tures four self­check­out kiosks for quick inand-out shop­ping trips. In Oc­to­ber, Tar­get will add to its ros­ter stores near the Univer­sity of Florida in Gainesville, Univer­sity of Texas in Austin, and North Carolina State. In ad­di­tion to col­lege­branded ath­letic gear and stor­age con­tain­ers de­signed for dorm rooms, Tar­get is also us­ing these stores to dis­play new prod­uct lines such as Casper mat­tresses, the on­line bed-in-a-box com­pany that Tar­get re­cently in­vested in. While other Casper prod­ucts such as pil­lows and sheets are sold in other Tar­get stores, the mat­tresses are only be­ing dis­played in 35 stores near col­lege cam­puses. At a time when many other re­tail­ers are clos­ing stores, Tar­get is among the few large re­tail­ers that con­tin­ues to open stores. It’s in the midst of a ramp up of open­ing more of these small-for­mat stores, with plans to open about 30 such stores this year and each of the next few years to reach 130 by 2019. These new stores are one of the ways Tar­get is hop­ing to re­verse slug­gish sales in ad­di­tion to other strate­gic ini­tia­tives such as re­mod­el­ing hun­dreds of stores, in­tro­duc­ing new brands, low­er­ing prices and over­haul­ing its sup­ply chain.

Star Tri­bune/GLEN STUBBE

A dis­play of mer­chan­dise for col­lege stu­dents stands in a Tar­get Ex­press store in the Min­ne­ap­o­lis com­mer­cial dis­trict called Dinky­town. Tar­get is ex­pand­ing the Ex­press store con­cept to col­lege towns across the United States.

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