By Sarah Nassauer
On Black Friday morning at a Target store in Brooklyn, stacks of
televisions, microwaves and toys awaited the rush of shoppers
looking for holiday deals.
Hours after the store opened, it was calm. The piles stood
tall.
More frantic were the Target workers pushing carts through
aisles to collect products ordered online by shoppers for home
delivery or for pickup at a desk near the front of the store.
Early data show that online shopping will once again account for
a larger percentage of total holiday sales compared with previous
years. Foot traffic to U.S. stores fell about 6.2% on Black Friday,
as more people ordered online or went to stores on Thanksgiving
Day, when visits increased 2.3%, according to ShopperTrak, which
uses cameras to count traffic in a range of U.S. stores.
"For this to be a Black Friday and it to be this calm in store,
it says a lot about the role of technology today," said Daniel
Murreld, a 29-year-old employee at the Brooklyn store who has
worked in retail much of the past decade.
Retailers are trying to adapt to a world where shopper behavior
is changing and competition for online spending is fierce. Target
Corp., Walmart Inc. and other retailers are staffing stores
differently in an effort to meet new competitive challenges, as
well as attract workers and control payroll costs amid the tightest
labor market in decades.
Online sales reached $7.4 billion on Black Friday, up from $6.2
billion last year, according to Adobe Analytics, which tracks
hundreds of retail websites. E-commerce is expected to account for
about $170 billion of the roughly $730 billion in total holiday
spending this year, according to National Retail Federation
estimates.
Some chains, including Target, Walmart and Best Buy Co., have
posted strong sales in recent years by adapting to the shift to
online shopping. They use their stores to handle deliveries or
convince shoppers to pick up orders rather than wait for an
Amazon.com Inc. package.
Target says it now sources 80% of its online orders from stores,
not warehouses. At the Brooklyn store around 80 workers handle
internet orders, collecting products from shelves or putting items
into boxes in the backroom for delivery.
Target retrained the bulk of its 300,000 year-round U.S. workers
over the past year, giving them new titles and responsibilities.
The Minneapolis, Minn.-based retailer hopes to mold each into an
expert for a specific area of the store such as the beauty
department, toys or online fulfillment to offer better customer
service and use labor spending more efficiently.
"I've been with Target for 22 years and this is the largest
[staffing] change I've been a part of," said Ashley Petzold, senior
group vice president of stores. "As the retail environment has been
shifting, I think we realized we needed to change as well."
After poor sales in 2017 prompted a new plan to invest in
stores, Target executives also decided to revamp the staffing
strategy, Chief Operating Officer John Mulligan said in an
interview. Internal shopper surveys showed low scores for customers
in need of assistance, Mr. Mulligan said.
At the same time, Target wasn't providing fast, consistent
service when shoppers ordered online for home delivery or pickup in
stores, he said.
Under the new staffing system, more workers are responsible for
the full chain of tasks needed to keep their department well
stocked and shoppers happy, including finding products in the
backroom and stocking shelves, tracking inventory and answering
shoppers' questions.
Target added technology on hand-held devices to guide workers
through the store more efficiently to gather or send out online
orders. And more workers are putting products on shelves during the
day, not at night, to be able to help customers at the same
time.
Target has also promised to raise the minimum hourly wage it
pays store workers to $15 by next year. Labor spending has
increased at a higher pace than sales each year since 2016, said a
spokesman.
Walmart, the country's largest retailer by revenue, has also
asked more staff to stock goods during the day in recent years,
though only in a minority of the retailer's 4,700 U.S. stores, said
a spokesman. The Bentonville, Ark., company uses stores to fulfill
its online grocery orders, and is increasingly relying on stores
for other types of e-commerce orders, although most are shipped
from dedicated warehouses.
As retail wages rise, daytime stocking is becoming more popular
as a more efficient use of labor hours that keeps workers in the
store helping shoppers, said Craig Rowley, a senior human resources
consultant at Korn Ferry, a consulting firm. Many retailers started
unloading trucks of goods and stocking shelves at night over 15
years ago, aiming to do that work fast without shoppers in the way,
said Mr. Rowley.
"It's like running a little business now," said Kevin Lopez, a
21-year-old sales associate responsible for the toy department at a
Target in Queens, N.Y. Ahead of the release of the "Frozen 2" movie
in November, Mr. Lopez asked his store manager for extra space to
stock toys related to the movie, trying to grab more sales. "I feel
like I'm more in control of my department," he said.
Some workers have found the change overwhelming. "They want
every employee to be doing everything and so it's making it so
nothing gets fully done," said a 21-year-old staffer in a Texas
Target. Others complained to managers when the new system made
their existing work shift unavailable.
"Change is hard, even the fact that we made the change over a
period of several years," said Mr. Mulligan. Target made sure each
store worker had a conversation with a superior about the new
system, he said.
Target is increasing market share in beauty and other areas
where it now has more dedicated staff trained to give product
advice. In 250 stores that tested the new employee structure last
year, sales increased faster than the chainwide average, said a
spokesman.
"I think the biggest change is the introduction of online and
digital retail into stores," said Ms. Petzold, the Target
executive.
The new staffing system will be stress-tested amid the holiday
shopping rush for the first time this year. On Black Friday
morning, at the Target store in Brooklyn, a line of shoppers waited
to pick up online orders at the front of the store.
A family considered buying a microwave offered at a discount,
but one of the younger members of the group chimed in, "No. Let's
order it online."
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
December 01, 2019 11:14 ET (16:14 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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