Target.Com Breaks Free from Amazon
Website ready to
re-launch as standalone site
It was about two years ago that Target announced that
it's break up with Amazon.Com, the company that had more
or less run all of Target.Com for most of the past
decade.
The breakup, which is amicable, means
that Target will no longer sell its products on
Amazon.Com. More importantly, it leaves the big box
retailer responsible for integration, fulfillment,
customer service and all the other down and dirty
functions that come with running a leading online
shopping business.
Target's decision to go its own way was prompted by a
need to have more intimate control of the online
customer buying experience and because the company sees
online as a growth opportunity. Target.Com is the 22nd
largest Internet retailer in the U.S., with $1.33
billion in 2010 sales. In contrast, Wal-Mart.Com ranks
as the sixth largest Internet retailer with an estimated
$4.4 billion in sales while Amazon is number one with
nearly $13 billion in sales last year.
Going it alone means investing in its own e-commerce
system and the retailer developed and tested its new
system in 8 months time. The lead vendor chosen to
develop the new Target.Com is SapientNitro who leaned on
IBM, Sterling Commerce and Infosys to meet the
technical, business process and marketing challenges of
the implementation effort. The team was rounded out to
include Oracle, Endeca, Autonomy, and Huge, which
designed the site.
A key challenge of the e-commerce platform is to ensure
integration of real-time inventory status (which
includes a few million inventory transactions) flowing
each day from direct ship vendors, fulfillment centers
and corresponding order transactions. The team also had
to make sure that the system is flexible enough to
handle "buy online-pick up in store" orders, social
media integration and mobile commerce. In a recent
conference call target announced that more than 10% of
total visits (some 30 million unique visitors) to
Target.Com are from mobile devices and that mobile
traffic is running more than double 2010 levels.
Further, they expect visits on mobile devices to exceed
traditional online traffic by 2015.
Target hopes that by controlling its own site they will
be able to sell a bigger assortment of products such as
baby furniture and patio sets than it can carry
in-store. The company said that more than 800,000
products on the new site will have free shipping. It's
chief competitor, Wal-Mart stores recently announced
that it is reorganizing its e-commerce operations in an
effort to better integrate retailing in stores and
online.
According to Gregg Steinhafel, Target's CEO, "the new
site will present clean, compelling visual and will be
easier to navigate and provide clear and consistent
product information with an efficient checkout". The new
Target.Com is expected to launch by the end of August to
give the retailer a chance to compete for a higher share
of the 2011 Holiday shopping season.
Published: August 2011 |
