Target Halts Subscriptions as Shoppers Opt for Same-Day Delivery

Target Corp. this month discontinued its subscription service model as shoppers increasingly look for more convenient and flexible delivery options.

“The majority of our subscription guests have shifted away from regular deliveries to enjoy the speed and flexibility of our same-day services,” said spokeswoman Jacqueline DeBuse. The company didn’t disclose how much revenue it generated with subscriptions.

Target Halts Subscriptions as Shoppers Opt for Same-Day Delivery

It’s quite a turn for subscriptions, which several years ago were seen as a boon for e-commerce. Getting shoppers locked into them created consistent revenue streams that impressed investors. The model proliferated from startups to legacy chains. But Target customers have moved on, lured by the ease and speed of same-day delivery and picking up online orders at the store, which can now be done without leaving your car.

The Covid-19 pandemic upended the retail industry with many stores closed for months. That forced chains to pivot even more to e-commerce. Major retailers like Target and Walmart Inc., which both stayed open because they were deemed essential, were uniquely prepared for the disruption because they had already been using their thousands of locations as distribution hubs to speed up online orders.

They’ve since expanded those capabilities, including Target adding 8,000 parking spaces for customers picking up web purchases.

©2020 Bloomberg L.P.

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