In Creating Chief Growth Officer Role, Target Steps Up Effort to Tie Property to Online Sales
Retailer Plans to Resume Efforts to Expand Store Count in 2021
Retail giant Target said 75% of its third-quarter digital sales were fulfilled by its brick-and-mortar stores. (Target Corp.)
By Clare Kennedy
For signs of the future of retail property, look at the new office of Christina Hennington.
She has been named the first chief growth officer of retailer Target Corp., which created the new C-suite role to lead its bid to expand and out-maneuver competition including chief rivals Amazon and Walmart. The competition has become particularly fierce in the past year as the retailers look for ways to use brink-and-mortar sites to fulfill and boost online orders.
How Hennington steers the retailer in her new position could have broad implications for real estate nationwide as rivalry among the biggest U.S. retailers heats up and the industry responds to changes in consumer behavior as well as the strategy of competitors.
Target promoted the long-time executive as the Minneapolis company takes a newly aggressive posture in the retail world, where it's one of a few major growing chains flush with cash and invigorated by triple-digit sales growth over 2020. That's come during a surge in demand in the pandemic that the company has managed by using its brick-and-mortar outlets to fulfill most of its online sales.
With the appointment, Target said it's looking to keep pace with the accelerated growth that Amazon and Walmart are also tapping. Hennington, formerly one of the company's chief merchandising officers, is expected to "work across Target’s organization to identify and pursue revenue-generating strategies that deepen the company’s relevancy with current and prospective guests, and reinforce its stronghold as a leading U.S. retailer," according to a company statement. Target did not immediately respond to inquiries for more information from CoStar News.
For years, Target was playing catch-up with Amazon and Walmart, but by May 2020 CEO Brian Cornell said on a quarterly call that the company was "ready to play offense." Target executives also said the company would pursue physical expansion with renewed intensity in 2021, as its brick-and-mortar stores played an increasingly important part of its digital sales, according to discussions of its most recent quarterly report, which was issued in mid-November.
"Altogether, between same-day services and packages shipped to our guests, about 75% of our third quarter digital sales were fulfilled by our stores," CEO Brian Cornell told analysts on a call at the time. "And of course, if you add that on to our conventional store sales of more than $18 billion, you can see that more than 95% of our total third-quarter sales were fulfilled by our stores."
The company said Hennington, who joined Target in 2003, has been "instrumental" in turning the company into a retailer that can deftly blend its physical and digital commerce.
By the time the pandemic hit the United States in March 2020, Target's e-commerce platform and bricks-and-mortar operations had been melded, which let the company take full advantage of quarantined consumers' increased demand for home goods and groceries.
Target was classified as an essential business, like supermarkets and utility companies, and allowed to stay open when other retailers with a more discretionary product mix were forced to close.
In its statement, Target noted that Hennington "played a critical role" in leading the company through the volatile post-pandemic landscape.
Target's largest rivals, Amazon and Walmart, do not have chief growth officers among their top leadership.
However, Walmart employs a chief omni strategy and operations officer who is similarly responsible with evaluating how the firm's priorities and investments work to "serve the mission to become customers’ primary shopping destination," according to its website.
That position at Walmart was notably filled in September last year by a former Target executive, Casey Carl.
Hennington's new position is similar to the one Carl held when he was at Target under a now-bygone title at the retailer, chief strategy and innovation officer. It was last held by Minsok Pak, who left Target in late 2019 for Mondelēz International.
That role was most closely associated with Carl, who was responsible for revamping Target.com after its bumpy roll out in 2011. From 2001 to 2011, Target outsourced the development and maintenance of its e-commerce operation to Amazon.
Target is making other changes now, too. A spate of other changes in Target's C-suite accompanied the announcement about Hennington.
Its other chief marketing officer alongside Hennington had been Jill Sando, who has been named the sole chief merchandising officer.
The company named Rick Gomez, who previously served as Target's chief officer of marketing, digital and strategy, as its president of food and beverage.
Cara Sylvester, most recently senior vice president of Target's Home division, has been promoted to the company's top executive echelon and will take over part of Gomez' old role. She is now an executive vice president and the chief of marketing and digital.
Katie Boylan, Target's chief communications officer, has been promoted from senior vice president to executive vice president.