The future of retail strategic recommendations for Target with team design f(x). Won 3rd place in the International Rotman Design Challenge.

1. ROTMAN
DESIGN
CHALLENGE

2. SEEING & TOUCHING
PRODUCTS IS HERE
TO STAY
“I come in needing
one specific item,
then I end up
shopping for more.”!
55%
30%
In Store Online
Shopping Preference
The Converged Lifestyle, KPMG

3. RELEVANCE AND
ACCESS DRIVE
PURCHASE DECISIONS
“I live in the area
and love seeing if
there are any good
deals while I am
walking by.” !
33%
18%
2013 2012
Preference for Local
PWC Retail Trends Report

4. SHOPPING SHOULD
BE BOTH FUN AND
PRODUCTIVE
“I go to Target
because I enjoy it
while I get stuff
done.” !
65%
65%
50%
50%
Lifestyle Lifestyle Everyday
Everyday
Planned Purchases
Connected Consumer, Oracle Retail
Connected Consumer, Oracle Retail

5. Problem
Framing
Field & Desk
Research
Concept Testing
& Finalization
Synthesis
& Ideation

6. Moms
Millenials
Outliers
Problem
Framing
Explore three customer groups
Current core customers
Future core customers
Shoppers outside the norm

7. Field & Desk
Research
Target
in-store
intercepts
Retail observations

8. Synthesis
& Ideation
In-depth interviews
Locavore
Target haterTarget lover
Digital shopper
Teen shopper
New mom
Mother of six
In-store shopper

9. Synthesized research insights
Generated dozens of ideas
Clustered similar concepts
Synthesis
& Ideation

10. Concept Testing
& Finalization
Brainstorming a mock-up
Market-testing the idea
Rendering the concept

11. Target has an opportunity
to lead a retail disruption
Make It Fun
Get Urban
Be Seamless
Design Principles
Seeing & touching
products is here to stay
Relevance and access
drive purchase decisions
Shopping should be both
fun and productive

12. What is it?
Here comes the
neighborhood
Urban customers trust Target for
everyday items and lifestyle products,
but big box stores don’t make sense
for their lifestyle or their location
Get Urban

13. What did we hear?
“It’s hard to find
sheets in Brooklyn.”
“I used to go in
high school. It’s
too far away now.”
“I’ll stop in and
shop for clothes
and home stuff.”

15. Bright!
by Target!
Get affordable, design-focused
lifestyle goods in
smaller (20-40k sq. ft.)
urban stores
Stop in and pick up
something for your
apartment, the party
you’re off to, or for your
weekend away
Get Urban

17. Target at Your
Convenience!
Get the Target brands
you love and trust right
near where you live and
work
Target now distributes
affordable, high-quality
everyday items through
local, small-scale
convenience stores
Get Urban

18. What to test first?
Consumer Desirability!
Run focus groups and pop-ups
of new concepts
Financial Viability!
Test product mix based on
margins/desirability
Project volumes by location
Technical Feasibility!
Build upon Target Express pilot
Assess supply chain delivery
Get Urban

19. What’s the impact?
Rev/Sq. Ft.: $600
2x Target’s $300 – between Urban Outfitters and CVS
Size: 30,000 Sq. Ft.
About half the size of a City Target
Total Rev per Store: $18.0 million
4-Wall EBITDA: 20%
10% Target Corp adjusted up for corporate G&A, etc.
Earnings per Store: $3.6 million
Leading lifestyle retailer for urban dwellers!
4-6 Bright by Target stores in every major "
US metro area
!
Up & Up is the ubiquitously available
brand for affordable everyday items !
Significant penetration across local networks of
stores in key markets
Bright by Target: Store economics
Get Urban
Future Experience! Financial Considerations!

20. What is it?
More fun at the
all-in-one
Large stores serve an important need
for Target’s core demographic. But
customers increasingly expect a more
engaging shopping experience
Make It Fun

21. What did we hear?
“Local producers are
awesome. I don’t want the
same thing as everyone.”
“It’s hard to pick when there
are so many brands. I worry
about being cheated.”
“Big purchases are an
investment. I want reviews
and expert opinions.”

23. The Local Hub!
Made Local, Made In
America (or Canada).
Spend your morning at
Target checking out
interesting local products
that fit your lifestyle
Target now offers new
product lines incubated
through the Target
Saturday Marketplace
Make It Fun

25. Up the in-store
& bring in the
online!
Check out that new product
you’re considering in our
Product Petting Zoos
Search and sort features and
reviews right in the store
Out of stock? Scan the tag
and get it shipped for free
Make It Fun

26. What to test first?
Consumer Desirability!
Pilot Target Saturday
Marketplace in high-density
suburbs
Financial Viability!
Assess Target Saturday
Marketplace visitor volume
Gather data from local
merchants
Technical Feasibility!
Pilot successful Target Saturday
Marketplace merchandise in
regional stores
Make It Fun

27. What’s the impact?
Target as a creative hub for
communities!
Saturday Marketplace and local product
sections at every suburban store, with local
business growth spurred by incubation from
the Saturday Marketplace.
!
Leading in-store experience retailer!
Increased frequency of store visits and larger
average basket size
Make It Fun
Future Experience! Financial Considerations!
Saturday Marketplace!
Logistics coordinator
Reduction in parking capacity
Increased number of vendors to manage
!
In-Store Experience!
Technology development
Reduced floor space

28. What is it?
Seamless
Shopping
Customers are diversifying the ways they
shop. Target brings the in-store fun online by
creating a seamless, delightful shopping
experience that offers customers transparency,
immediacy, and personalization
Be Seamless

29. What did we hear?
“The website used to tell
me if certain items were
available... it doesn't now.”
"There's no free shipping
on the Target website. "
“Too many things are
out of stock too often.”

31. Shop the world !
Take a photo of
something you like and
get suggestions for
Target products that fit
your style
Target is redefining
e-commerce as a
leader in
interactive content
Be Seamless

33. TaskRabbit !
for Target!
Get same day delivery
from your local Target
Team up with an online
community of
individuals willing to
make a Target run for
you when you can’t
Be Seamless

34. What to test first?
Be Seamless
Consumer Desirability!
Test beta app in control group
Build TaskRabbit network at
sample store
Financial Viability!
Assess usage of beta app
before full build
Consider revenue share model
with TaskRabbit
Technical Feasibility!
Analyze build vs. buy/partner
strategy for delivery

35. Where will it take us?
Target brings its incredible in-store
experience to the smartphone!
Significant adoption by both core customers
and millennials who use the app to drive
increased online and in-store purchases; new
channel for customer data and analytics
Target-TaskRabbit network used as
primary on-demand channel
Last-mile delivery handled by distributed
network of Target TaskRabbits
Shop the World!
Technology development
!
TaskRabbit for Target!
If Build: Need to establish two-sided market
and monitor/manage requests added and
fulfilled. Consider pre-signing interested parties
before launching the platform
If Buy/Partner: Would need to work with
TaskRabbit to create functioning
networks around Target locations
Be Seamless
Future Experience! Financial Considerations!

36. “I’m a little obsessed with
Target. I go there to
de-stress. I just love it.”
“The highlight of my life
is going to Target.”

37. Disrupt retail
Get Urban!Make It Fun!Be Seamless !

38. APPENDIX!
1) Customer Lifetime Value Segmentation
2) Customer Journey Map
3) Concept Deep Dive
4) Additional Concepts
5) Future Impact Detail

39. Our strategy is
rooted in building
loyalty to capture
the full lifetime
value of a customer
as they move
through different
life stages.
Recommended
shopping
experience
Existing
shopping
experience
LOYALTY CURVE: LIFE STAGES, LIFETIME VALUE
Loyalty Curve: Life Stages, Lifetime Value
Frequency of Trips OR Customer Spending Power
Length of Relationship
RedCard Users
Teens College Young Adult,
RedCard Users
Young Family Empty Nesters Senior
Citizens
Active, Non-Loyal Active, Loyal Active, Loyal Active, Loyal Inactive, Loyal
Ideal
Curve
Existing?
Opportunity to
intercept and
establish loyalty,
increase frequency
of trips to Target,
and increase share
of wallet

40. Customer Journey Map
Mood
Look for items
Browse
Test items
Compare prices, look for coupons, do research
Purchase
Enter Store Time
Zero Moment of
Truth
Search and Sort
Discovery
Touchscreen
Personalized
Offers
Inventory Track
Product
Petting Zoos
Interactive,
Immersive
eCommerce
Painless
Checkout
In Store Checkout
Saturday
Marketplace
As Alice moves
through the store, she
is greeted with a
seamless shopping
experience.
Recommended
shopping
experience
Existing
shopping
experience

41. Why Urban? Why Target?
I love Target because I can
get food, clothes, shoes,
bathroom items, everything
there. And it's so bright and
cheery inside!”
Millenials have
high lifetime
value as
customers
Target is loved
for affordable,
stylish
products
Low-cost,
private label
brands are
respected
Huge
opportunity in
grocery space
1 of 3

42. Why does it matter?
Consumers are less satisfied and purchase
less when they are overwhelmed by options.!
!
Consumers do not shop at locations out of
their way.!
!
Consumers prefer to shop in curated,
boutique environments.!
2 of 3

43. What has to be true?
Curation
Location
High-Volume
Urban Areas
Optimize
Inventory
Inventory Management
Data collection + real-time
crowd-sourced
Experience Enhancement
Focus on designing for
see-feel-touch in-store
New Revenue Source
Beyond just opening a
new store, Target can
lead a category
3 of 3

44. Why Local? Why Target?
Increase loyalty
through local
community tie-ins
Capture all
leads through
on-demand
order and
shipping
Gain trust
through a more
curated
selection
Stop
showrooming
with product
petting zoos
and free
shipping
“I wish Target had more local,
organic and chemical free
children's products besides
Johnson Johnson.”
1 of 3

45. Why does it matter?
Consumers have a higher willingness to pay
and preference for custom lifestyle products
that are unique and local. !
!
Consumers get stressed when having to sort
through too many products and make a
decision. !
!
Consumers value reviews and research prior
to purchasing big ticket items. Providing this
on-site can reduce showrooming. !
2 of 3

46. What has to be true?
Immersive Local
High-Volume
Surburban Areas
Introduce New
Products
Differentiate, Boost Sales
To relieve the tension
between local versus mass
purchases, give local options
Experience Enhancement
Bring out products for
consumers to try and
get shipped right away
Act As An Incubator
Source profitable new
products with little risk
and cost
3 of 3

47. Why Seamless? Why Target?
Build loyalty by
catering to
customer
expectations
for immediacy
Create delight
by offering
personalized
discovery
Gain trust
through
transparency
and customer
service online
Build brand
equity by
becoming a
content creator
“I hate going onto a website
and being bombarded. I return
most stuff I buy online since I
can’t tell if I’ll like it or not.”
1 of 3

48. Why does it matter?
Online is perceived as a resource the
complements the in-store experience. !
!
Shipping costs is a deal breaker for shoppers
who prefer the in-store experience.!
!
Out of stock items can result in lost sales!
2 of 3

49. What has to be true?
Seamless
Immediate
Anytime,
Anywhere
New
Technologies
Curated, On Demand
Provide personalized product
recommendations and
delivery through mobile
Make Online Touchable
Bring in-store online
through immersive,
interactive experiences
Fuel Social Shopping
Integrate with existing
Target app to make
shopping carts social
3 of 3

50. Additional
Concepts
Immersive
e-Commerce!
Interact with products,
watch videos, and chat
with experts. Target can
redefine ecommerce by
becoming a leader in
interactive content and
customer service

51. Additional
Concepts
Fewer Choices,
Easier Choices!
Consumers get
overwhelmed by too
many choices and feel
manipulated. Make
shopping easier by offering
high-quality store brands
and cut down on selection
for a curated experience

52. Future Impact: Where do these concepts take us?
Where we’re starting
What we propose
Where we’ll go
Target at your
Convenience!
Bright !
by Target!
Small number of
slightly scaled-down
urban stores
Leading lifestyle retailer
for urban dwellers!
4-6 Bright by Target
stores in every major
US metro area
!
Up Up is the
ubiquitously available
brand for affordable
everyday items !
Significant penetration
across local networks of
stores in key markets

53. Future Impact: Where do these concepts take us?
Where we’re starting
What we propose
Where we’ll go
Up the in-store
bring in the online!
The!
Continued growth of Local Hub!
showrooming resulting in
lower sales of research
intensive purchases
Risk of store visit
experience becoming
irrelevant and
commodified
Overwhelming selection
of parity products
competing with
increasingly respected
in-store brands
Target as a creative
hub for communities!
Saturday Marketplace
and local product
sections within every
suburban store
!
Leading in-store
experience retailer!
Increased frequency of
store visits and larger
average basket size
Fewer Choices,!
Better Options!

54. thank you!