Target’s curbside offering, called Drive Up, was already well-established by the time the COVID-19 pandemic hit. The Minneapolis-based retailer started testing the service in its hometown in late 2017, and it went nationwide in 2019. That strong early foundation combined with a savvy strategic buildout of the service propelled Drive Up to head-turning growth in 2020, even in a business segment exploding throughout the industry. Target saw Drive Up sales soar 600% early in 2020 and 500% through the second half of the year, and it sustained triple-digit growth into 2021. In Target’s most recently reported fiscal quarter, which ended in October, online comp sales overall were up 29%, again led by growth in Drive Up.
Target has continued to win new Drive Up fans and deepen its engagement with existing ones by expanding the assortment of grocery items—in particular, refrigerated and frozen items, as well as alcohol beverages (added in May 2021)—available for pickup through the service and by adding more Drive Up parking spaces as well as a feature that lets customers designate an alternate driver for pickup. Trough the Target app, guests can identify their vehicle color and type and where they want their order placed—in the trunk, for example, or the backseat—both to save time and to help make the service truly contactless (a not-insignificant benefit throughout COVID surges). Drive Up holds the title of Target’s highest-rated fulfillment service, the retailer has noted.
In addition, Target emphasizes that its online offerings build rather than replace in-store sales. Customers who try Drive Up spend about 30% more than they did before, including on groceries and other household essentials, Target CFO Michael Fiddelke noted last March. “Guests turn to Target because of our stores and our digital options, not one vs. the other,” Target Chairman and CEO Brian Cornell said in May.