printed-out photos of the old layout, which
hadn’t changed much since the flagship was
built in 2001. “It was gondola hell, right?” Mulligan says, referring to the basic shelving units
you see in stores. “Just rows and rows of stuff.
No sight lines.” Mulligan shakes his head as
he points to a depressing image of the in-store
Pizza Hut that used to greet customers.
The layout has been reorganized around
Target’s new brands, and the presentation is
crisp and contemporary. (Inexplicably, the
company didn’t have a visual merchandising
department until just two years ago; Cornell
has since poached talent from J.Crew and the
Limited.) As Mulligan ushers me through the
store, he beams at the displays, each of which
will now be refreshed monthly, which is double
the previous rate: There’s an autumn-themed
collection from Cat & Jack; sporty JoyLab leggings designed in partnership with Clique,
whose Who What Wear line has been a hit at
Target since it launched in 2016; and modern
dining chairs and walnut tables from Project
62. “Before, it was a dead
zone back here,” he says
of the home-essentials
area. Other parts of the
store feature bright new
arrangements of exclusive products from
such as Harry’s and
Casper, and even the fitting room looks more
like what you’d find in a Club Monaco. As for
the Hut? It’s been replaced by fresh groceries
and a liquor and craft beer shop. Target will
remodel an additional 1,000 stores in a similar
fashion by 2020, while also rolling out more
localized stores with smaller footprints.
The redesigned “Tar-zhays”—there are
around 110 of them so far—have delivered up
to a 4% jump in sales at each location, but the
more promising return from this investment
has come from the house brands themselves.
Cat & Jack customers, for example, spend
50% more in surrounding kids’ retail areas,
Mulligan says, adding that their total basket
size is 23% higher than other customers’. Most
significantly, Target’s consumer research has
shown that its brands have become a “trip
driver”: People come to the store for Cat & Jack
as much as they do for essentials like laundry
detergent or bread or milk. “Target has always
won with a spirit of design that their competitors didn’t have. I don’t see any other move for
them: They’re not going to beat Amazon on
e-commerce,” says a high-level retail expert
who has advised the company on strategy.
The faster Amazon
delivers, the more
cash it burns.
soared to $7.2 billion
in 2016 from
$5 billion in 2015.
“WE WANT TO REINVENT, BUT WE SURE
DON’T WANT TO REINVENT THE WHEEL,” SAYS
WARBY PARKER CO;CEO NEIL BLUMENTHAL.
“IGNORE BEST PRACTICES, GET CRUSHED.”