Target reportedly may take on Amazon and Walmart with paid membership program
Target is said to be considering launching a membership subscription service similar to Amazon Prime and the one offered by Walmart (Walmart+).
According to Bloomberg, Target is internally discussing a program known as “Project Trident” that would operate like Amazon Prime or Walmart+, providing benefits such as free delivery and fast delivery on eligible purchases for a monthly or annual fee.
Both Prime and Walmart+ also offer a variety of other perks and services, some for free and some for an added fee. In addition, Prime membership provides access to special sales events such as Prime Day, and Walmart+ membership offers early shopping for promotions like Walmart Black Friday.
In addition, Amazon and Walmart both work with third-party partners to provide some features and occasionally offer limited-time special promotions. Both membership programs also have a free one-month trial membership option for non-members, which can be used to participate in sales promotions such as Prime Day.
Amazon initially launched Amazon Prime in 2005, creating the template for a paid retail subscription program. Benefits include free one- and two-day shipping on eligible products, as well as free same-day delivery for eligible orders meeting minimum threshold ($25 in most U.S. metro areas) and free use of Amazon’s digital streaming, gaming and music services.
Initially introduced in in September 2020, Walmart+ offers benefits including unlimited free delivery on orders of $35 or more, gasoline discounts of up to five cents a gallon and access to the chain’s Scan & Go app, which allows shoppers to avoid checkout lines by scanning items in the store and checkout using Walmart Pay.
Target currently offers a free loyalty program called Target Circle, which it initially piloted in 2017. Benefits include offers 1% off every purchase to redeem on later purchases, as well as personalized perks, including tailored discount offers, a special treat on their birthday and deals offered with third-party partners.
In addition, Target operates Shipt, a same-day personal shopping and delivery platform, as an independently operated, wholly-owned subsidiary. Shipt provides delivery from Target as well as a variety of other retail partners, and also offers a membership program, which costs $99 per year or $10.99 per month, and includes unlimited free deliveries for orders of $35 or more (orders less than $35 will include a $7 delivery fee and applicable service fees).
Members also receive some other perks. Consumers can also use Shipt without membership for a $10 fee per delivery. Presumably, Target could combine features from its Circle and Shipt offerings with a paid membership service.
In its most recent quarter, Target reported declining sales, transactions and transaction amounts due to delayed discretionary purchases, even as earnings surged thanks to internal discipline. However, same-day services such as drive-up saw a healthy 8% increase.
Chain Store Age has reached out to Target for comment. Read more Bloomberg coverage here.