Target’s online sales grow $13 billion over 2 years

Sales via Target’s same-day fulfillment services grew 45% in fiscal 2021. Overall digital sales grew 20.8% for the year and 9.2% in Q4.

Target Corp.’s digital sales grew 20.8% for the fiscal year ended January 29 and 9.2% in fiscal Q4 of fiscal 2021, up from comparable periods the year before, the retailer reported.

Contributing to the retailer’s digital growth increase was a 45% year-over-year growth in sales made via the retail chain’s same-day omnichannel services, which includes in-store pickup, same-day delivery via Target’s Shipt service and curbside pickup, dubbed Drive Up by Target. That growth was on top of 235% year-over-year growth in same-day services in fiscal 2020.

Drive Up was its fastest-growing same-day service. Sales fulfilled via Drive Up grew more than 70% in its 2021 fiscal year, on top of a 600% increase in 2020, Target reported. For Q4, digital sales represented 21.8% of total sales, down slightly from 22.1% for the year-ago quarter.

Target says digital sales represented 18.9% of its $106.01 billion in total revenue for the year, up from 17.9% for the previous fiscal year. For the quarter, digital sales represented 21.8% of its $31.00 billion in total revenue, down slightly from 22.1% for the year-ago quarter.

During a March 1 meeting with analysts, Target CEO Brian Cornell said Target believes stores are vital to growing its digital business.

“The way we run our stores is the secret to why digital is now 19% of sales,” Cornell said. “So, as we look at the next five years, we are going to continue to build on our strengths. Inflation and the war in Ukraine adds more uncertainty about the state of the economy, higher prices across the country, supply-chain constraints, as consumers continue grappling with the effects of COVID-19.

Target currently has 40 million customers who shop across sales channels. Omnichannel guests spend four times as much as stores-only guests and digital-only guests.