In an effort to raise its game in the delivery space,Target Corporation (TGT - Free Report) recently announced same-day delivery service for more than 55,000 groceries, essentials, home, electronics, toys and other products in the Colorado through Shipt. Thanks to Shipt, 4 million consumers in the region will now get products delivered within an hour.
This follows the announcement to initiate same-day delivery in five major cities — Boston, Chicago, New York City, San Francisco and Washington, DC — this month.
Interestingly, this Zacks Rank #3 (Hold) company is trying to gain customers by coming up with new service offerings. For those opting up for the service prior to the launch, the company has announced an annual membership fee offer of $49 instead of the customary $99. Also, with the annual membership, customers can avail free delivery on orders above $35.
Target, which shares space with Costco (COST - Free Report) , is going the extra mile to deliver seamless, same-day shopping experience to customers. The company also aims to be the first retailer to offer same-day delivery in almost every major market by the holiday season. According to BisReport analysts, the same-day delivery market is expected to reach a value of $4,620 million by 2021. Given the bountiful opportunities in this niche, we expect the company to gain traction in the near term.
Moreover, according to Nielsen and the Food Marketing Institute the percentage of consumers in the United States buying groceries online is likely to bump up to a whopping 70% over the next four years. So it can be assumed that the same-day delivery space will heat up pretty soon and the company clearly is gearing up to make the most of it.
Maintaining its commitment to maximize customer satisfaction and keeping up with Amazon (AMZN - Free Report) and Walmart (WMT - Free Report) in the delivery space, Target took over Shipt and a transportation technology company Grand Junction last year.
Apart from these, Target’s Drive Up service which is now available in 270 stores in South and Southeast is attracting customers. With this, customers can receive the delivery at a Target store after ordering via app. The company intends to expand the service to 1,000 stores by the end of this year.
Given these endeavors, over the past year, Target has gained 34.9% outperforming its industry’s gain of 21.4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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