Target Moving to Small Format Stores to Attract Millennials

John Krautzel
Posted by in Retail

Big box stores continue to struggle as more and more shoppers turn to the convenience of online shopping for many of their purchases. Target thinks it's found a solution with a line of small format stores designed to target younger generations. Focusing on college campuses and hip urban centers, these smaller versions of Target aim to offer exactly what consumers need most plus a fun shopping experience.

The first of Target's small format stores opened in 2014, and plans are underway to build more, with a goal of over 100 small format Targets open for business across the United States by the end of 2020. These stores use a hyper localization model that seeks to meet the particular needs of the communities where they are located. In the case of college campuses, the entire shopping experience is designed to pull in millennial and Gen Z consumers. Trends in retail point to the value of gaining the regular business of these younger shoppers, and Target aims to build loyalty that will have shoppers choosing the Target brand during every stage of their lives. To extend the reach of the Target branding, Target plans to also remodel current stores to match trends in their small format stores for consistency and to promote Target products at the more than 800 Barnes and Noble locations that are already located on college campuses across the country.

One of Target's strategies for their small format stores is to address the pain points of their customers. In the case of college students, that includes transportation. In some areas where Target is not right on campus, Target is partnering with Gotcha Ride to provide students with free transportation to Target during the early weeks of the semester. Target is also emphasizing its stylish but still reasonably priced products that meet students' needs to make their home away from home more comfortable and fashionable. These stores also provide students with an easily accessible location to pick up orders from without hefty shipping fees or the hassle of coordinating package pickups in dormitories.

After students start shopping, the staff at each small format store is ready to use data about purchasing habits to tailor their stock more closely to the specific market. Adding popular local food products, meeting students' particular tech needs and staying in tune with campus fashion trends helps Target small format stores satisfy customers in their smaller retail spaces. Stores also directly solicit customer feedback to ensure they are doing a good job of meeting consumer needs. Current trends in retail point to the value of big data in creating better shopping experiences, and Target has specialists in guest insights and research ready to help managers keep up with buying trends in real time for a continual selection of fresh merchandise to pull consumers in and keep them coming back.

Expect each Target small format store to be somewhat different from the others with an emphasis on community pride. Target plans to continue using their small format locations as places to experiment with new methods to engage shoppers for a continual improvement model to grow the brand into the future. Look for other retailers to try this small format store model to similarly grow their brands.

Photo courtesy of Mike Mozart at


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