Target said comparable sales rose 17.2% on Wednesday in November and December as customers bought matching pajamas and gingerbread house sets to celebrate a cozy holiday during the pandemic.
While online sales remained strong, shoppers also visited Target’s stores and spent more money per purchase than they did last holiday season. The combined transactions in Target stores and on its website increased by 4.3% and the average tickets grew by 12.3% year on year.
Despite strong results during the peak trading season, the pace of Target’s sales growth slowed slightly compared to the gains it recorded in the third quarter of the fiscal year. The delay highlights the challenge facing Target in the quarters. As more Americans are vaccinated, the company will have to prove that it can maintain market share gains, even if consumers feel more comfortable traveling to smaller stores or returning to shopping malls.
The pandemic could also permanently change the cadence of the holiday season. Target said its stores will be closed on Thanksgiving Day 2021.
The retailer chose to stay the last day of Thanksgiving due to the health crisis. To spread sales and thin crowds, Target began selling weeks before Thanksgiving, which was previously the starting point for the search for gifts and stocking fillers. It also offered more of its transactions online.
According to Target, comparable digital sales more than doubled in November and December compared to the previous year, while comparable store sales grew by 4.2%.
Target’s lead only includes sales in November and December, although the fiscal fourth quarter only ends on January 31st. The report will report the full quarter results on a virtual investor day on March 2nd. Prior to Wednesday’s news, analysts polled by Refinitiv estimated that Target would earn $ 2.27 per share, after adjustments, on revenue of $ 26.67 billion.
Target was one of the highlights in a hard-hit retail industry. It reported a noticeable sales growth and an increase in market share of $ 6 billion, as many other retailers were halted by temporary store closures and even went bankrupt during the pandemic. Since consumers have limited shopping trips, they have spent more of their dollars in a handful of places, and these are usually retailers where they can get a gallon of milk, detergent and sweatpants in one stop or all at once. website.
As in the earlier months of the pandemic, Target buyers continued to use the company’s fast and contactless online options. Its same-day pickup service, Drive Up, has grown by more than 500%. The target sales that Shipt reached increased by more than 300% during the holidays.
Few retailers have reported their holiday sales so far, but Target has far exceeded the sector’s e-commerce growth. According to Adobe Analytics, U.S. online purchases grew by 32.2% during the 2020 holiday season from 2019, as more buyers bought from home during the pandemic.
Target also made strategic moves that paid off. It owns Shipt, a service that delivers at home today. It recently added fresh and frozen groceries to the pickup, a same-day service that grew by more than 500% during the holidays. And it has expanded the range in its own brand Good & Gather for food and beverages, with a first-class range of gourmet pasta sauces and coffees as people cook more at home.
Housewares and constipation, which include equipment and sports equipment, were especially popular during the holidays. Both categories achieved the sales profit of the same store in the low 20% range, compared to a year earlier. Within hard lines, growth was fueled by electronics sales.
Comparable sales of food and beverages increased by about 17%, Target said. The beauty and necessities grew in the low teens and clothing made a high one-digit profit.
Target says family pajamas and Christmas tree decorations are one of the top sellers. The retailer also sold nearly 2 million of its Wondershop gingerbread houses.
Target shares, which have a market value of almost $ 100 billion, have risen by almost 60% in the past year. The stock closed at $ 199.10 on Tuesday, not far from the 52-week high of $ 199.50 it set on Monday.