Goal: Streamlined Checkout and GenAI Chatbot Improve the in-store experience

A streamlined checkout experience and the deployment of generative artificial intelligence-powered handheld devices for employees have improved the in-store experience at Goalsaid the retailer on Wednesday (21 Aug.).

Target saw improvement in the in-store checkout experience in the second quarter after streamlining self-checkout and ensuring adequate staffing in full-service jobs, Target Chief Operating Officer and Chief Financial Officer Michael Fiddelke said Wednesday during the company’s quarterly earnings call earnings to call.

“With all these changes, we’ve seen a continued substantial improvement in our Net Promoter Scores related to the purchase experience, with scores related to wait times and interactions at checkout the strongest we’ve seen in six years,” Fiddelke said on the call.

Target also completed the rollout of them generative AI-powered handheld devices for employees. These devices answer common questions and share best practices, Fiddelke said. Employees have used the technology more than 50,000 times, and they got their answers and completed their conversation with the AI ​​assistant in less than a minute, on average.

“We will continue to refine this tool over time based on feedback from our team, but many are already telling us that it has improved their daily work experience, making it easier and faster for them to serve our guests help,” said Fiddelke during the call.

“In addition, leaders in our stores tell us that they expect this new tool to be especially helpful as we bring in new and seasonal team members ahead of this year’s holiday season, helping them become more productive, faster than in the past,” he said on the call.

During the call, Target executives reported that consumers are responding favorably to the company’s latest initiatives in pricing, digital services and loyalty programs as they seek value, convenience and novelty.

These enhanced offerings contributed to year-over-year growth of 2% in comparable sales and 3% in traffic in the second quarter, with sales growth being at the top of the retailer’s expectations, Target said in a Wednesday earnings release.

“In an environment where consumers continue to make meaningful trade-offs, our Q2 results demonstrate the power that comes from the right combination of novelty, seasonal relevance and compelling value,” Target Chairman and CEO Brian Cornelius said during the call.

Second-quarter growth was driven entirely by traffic, which in turn was driven by several guest-focused initiatives Target announced in March, Cornell said.

For one thing, the retailer improved its digital experience. This contributed to single-digit growth in its digital comparable sales in the second quarter and low-teens growth in two of its same-day services: Drive up and Target circle 360which offers same-day delivery.

“Same-day services now account for more than two-thirds of our digital sales,” Cornell said on the call, attributing the growth to consumers seeking convenience.

Consumers also responded to Target’s newest offerings focused on value, Cornell said. These initiatives include a reduction in prices on 5,000 frequently purchased items in many markets during the summer, and a relaunch of the Target Circle loyalty platform in the first quarter.

In the second quarter, 2 million new members were added Target Circleadding to the 100 million members the loyalty program already had.

“Beyond the immediate benefit of guest engagement with the platform, Target Circle also helps us gain deep consumer insights, allowing us to extend more personalized, customized offers through our Round advertising company,” Cornell said during the call.

In terms of product categories, Target saw trends strengthen across the board. Both discretionary categories such as apparel and beauty saw a rise in comparable sales, as did essential categories such as food and beverage, Cornell said. Executives attributed the growth of both clothes and beauty to the novelty of the company’s offer.

Target Chief Commercial Officer Rick Gomez said during the call that while American families are still under economic pressure, and the economic data is still mixed, they remain ready and able to spend.

“Yes, they still are meager; yes, they are budget conscious; and, yes, they’re looking for deals and everyday value, but they’re also willing to shop when they find the right combination of fashion and novelty at the right price,” Gomez said.

Looking ahead, Target expects to see comparable sales growth of 0% to 2% in the third quarter, according to the earnings release.

“As we continue to survey consumers and monitor the external environment, our view remains largely the same as we have shared for some time: consumers have shown remarkable resilience in the face of multiple challenges in recent years, and they remain sustainable today,” Cornell said during the call. “Given the significant headwinds they’ve faced with inflation over the last several years, consumers continue to focus on value as they work hard to manage their household budgets.”