Star Tribune
MINNEAPOLIS – Target.com is offering free shipping on all orders with no minimum purchase size in a special promotion this week. That is usually the sort of thing retailers do around the holidays to help lure in some last-minute sales.
So why do it the first week of June?
“Part of it, number one, is reinforcing our leadership in free shipping,” said Eddie Baeb, a Target spokesman.
He noted that Target’s free shipping promotion during the holidays was very popular. So this was also an opportunity for the Minneapolis-based retailer to test it at a non-peak time outside of that shopping frenzy.
“With school winding down and the kick of summer, it seemed like this was a good time to do this for our guests,” Baeb added.
The move also comes at a time when Target, which has been criticized in the past for behind the times with its website, is trying to become a leader in online sales. Online sales make up less than 3 percent of its overall sales, but Target CEO Brian Cornell has set a lofty goal of increasing its online sales by 40 percent for the next several years.
The week of free shipping also comes not too long after word leaked out last month that Wal-Mart will be piloting a $50 a year free shipping program this summer that will rival Amazon Prime’s $99 a year membership free shipping program. Wal-Mart’s ShippingPass will only be available in select markets and will be by invitation only, but it aims to get select items to customers within three days at no extra charge.
When asked about those developments in recent weeks, Target executives have noted that the retailer’s Redcard credit and debit card gives customers free shipping on its website all the time (as well as a 5 percent discount). Chief Financial Officer John Mulligan also recently reminded reporters on a conference call that there is no membership fee to be a Redcard member.
And in February, Target lowered the free shipping threshold on its website to orders of $25 from $50.
“We feel very confident those are very compelling offers,” Mulligan said of the lower free shipping threshold and Redcard perks.
But one area where Target is still catching up is with speed of delivery. Amazon Prime members can get select items delivered to their doorstep within two days.
This is only the third time Target has offered a free-for-all when it comes to shipping on its website. During this last holiday season, it offered free shipping for several weeks in a move that raised a lot of eyebrows across the industry. In February 2014, Target also ran a two-day free shipping promotion on its website.
Target has said that about two thirds of orders on its website qualify for free shipping either because they meet the minimum order size threshold or the purchase is made with a Redcard.
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