Phoenix Flexible Format Target Opens

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Re: Phoenix Flexible Format Target Opens

Post by rwsandiego »

arizonaguy wrote:
rwsandiego wrote:The new flexible format Target at 16th and Camelback had its soft opening on 7/19 and I checked it out today, 7/20. I was underwhelmed.

The best thing I can say about it is the carts are new and roll smoothly. The grocery section didn't have much selection, but to their credit they are heavy on organics and natural items, which will play well in the area. That said, there's a Trader Joe's, Whole Foods, and Fry's within a few blocks of this store and Target closes at 10:00, so unless they beef up selection and drop prices, there will be no reason to buy groceries here. The cleaning products section wasn't great and from what I can tell the health and beauty wasn't, either. They should have nixed men's clothing and expanded cleaning products and groceries.

Had Target built in downtown Phoenix, which is more walkable and could use this type of store, I'd think it was a great store. However, if I have to drive to a store that might not have what I am looking for I might as well drive to a real Target.
I went to the store today and I wasn't impressed but I wasn't really disappointed either. For its size it seems to cover all of the bases. The problem is that other than offering a one stop experience, EVERY single item that this store sells is available within 3 blocks of this store at another retailer.

This Target has a Starbucks, there's also a large standalone Starbucks in its parking lot.
This Target has a CVS/Pharmacy, there's a very large (former Eckard) CVS/Pharmacy across the street.
This Target has HBA. The CVS/Parmacy across the street and the Fry's a few blocks away have larger HBA departments.
This Target has a small grocery section. There's a Fry's, a Trader Joe's, and a Whole Foods Market a few blocks away.
This Target has a liquor aisle. There's a Total Wine across the street.
This Target has a small electronics department. There's a Best Buy a few blocks away.

As far as clothing. There's a Marshall's and Nordstrom Rack within blocks of this store as well as a Macy's and Saks Fifth Avenue within 1 mile.

The reason this store even exists in the first place is that Target lost coverage of this area when it closed its store at 7th Ave. and Camelback Rd (2 miles West of here).

The other interesting thing about this store is the checkstand setup. There are 2 "regular" checkstands and 6 self checkout kiosks.
All great points. To me, they would have been better off building on the vacant lot at Indian Scool and Central.
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Re: Phoenix Flexible Format Target Opens

Post by storewanderer »

When you make posts like that, it makes you wonder if there is any point for Target anymore? (and also for Wal Mart in certain locations)... as you point out, within close proximity, there are so many other stores with the same exact product offerings/services...

This is something I wondered 10 years ago as the economy was bad, Kmart was fading off, Shopko was closing stores like crazy, and Wal Mart and Target both seemed to be having some challenges: will the mass merchandise store just fade away?
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Re: Phoenix Flexible Format Target Opens

Post by arizonaguy »

storewanderer wrote:When you make posts like that, it makes you wonder if there is any point for Target anymore? (and also for Wal Mart in certain locations)... as you point out, within close proximity, there are so many other stores with the same exact product offerings/services...

This is something I wondered 10 years ago as the economy was bad, Kmart was fading off, Shopko was closing stores like crazy, and Wal Mart and Target both seemed to be having some challenges: will the mass merchandise store just fade away?
I think that the mass merchandise store has a place in brick and mortar retail. I just am not sure if Target's "curated" version of mass merchandise does, and certainly it doesn't in a mostly suburban city such as Phoenix. If this was a full line Target store, I wouldn't have an issue with it. Target has full line stores next to the competition I mentioned in numerous other places in the Phoenix area (as well as similar competition nationwide) and does fine.

Small format "curated" Targets work when the majority of the customer base is walking to the store. This Phoenix store will obtain 98% of its shoppers from either car or public transit bus. Why would those shoppers want to waste their time with a Target that doesn't necessarily have what they're looking for (even if the other Target stores do) and even full line Targets don't have a great selection in many departments as is?

The original poster hit the nail on the head. This store would make sense in downtown Phoenix. Uptown Phoenix, where this store is, is not downtown. It's suburbia. Yes, I know that there isn't a plot of land large enough to fit a full line Target in this area (there was, and ex-Sams club, but a local pool supply company purchased it to turn it into their HQ / warehouse and I doubt Walmart would have wanted Target to open up there).

Target has two full line stores within 6 miles / 15 minutes of this store (one a SuperTarget). CVS, as I've said before, has a large store across the street. Starbucks has a full line store in the parking lot of this store. Due to the demographics of the area, I'm sure many shoppers in the immediate area surrounding this store would've patronized the other Targets, CVS store, or Starbucks instead.

I think that this store has a chance to "dilute" the Target brand. They've tried to put their full line of products into this store but have a limited selection of everything. I know this is likely what Amazon will do if it were to go into general merchandise brick and mortar but it's simply not something that Target should be doing.

I feel similarly about Walmart Neighborhood Markets as I do this "flexible format" Target format. Walmart Neighborhood Markets are pretty crappy supermarkets which seem pointless if there's a decently priced supermarket around (such as a Fry's or a WinCo). The Neighborhood Markets seem to be able to do best in markets where high priced supermarket chains struggle (in Arizona Walmart NM hurt Albertsons/Safeway and Bashas').

Walmart Neighborhood Markets at least have pricing as a competitive advantage. Again, I don't think this store does anything better than the competition within 2-4 blocks of it.
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Re: Phoenix Flexible Format Target Opens

Post by pseudo3d »

storewanderer wrote:When you make posts like that, it makes you wonder if there is any point for Target anymore? (and also for Wal Mart in certain locations)... as you point out, within close proximity, there are so many other stores with the same exact product offerings/services...

This is something I wondered 10 years ago as the economy was bad, Kmart was fading off, Shopko was closing stores like crazy, and Wal Mart and Target both seemed to be having some challenges: will the mass merchandise store just fade away?
Maybe without food, but I read somewhere that millennials tend to like one-stop shopping, which is why Amazon has been so popular. But few to no stores do everything. Walmart's food section is especially lacking (in terms of prepared foods at least, I don't really care for chicken or frozen egg rolls that have been baking under heat lamps all day) and it's, you know, Walmart. Target's stuck in its own ways and has tried to do what it wants to do with consequences that will come down the line. Kmart was mismanaged and never improved despite having blown its opportunity in the mid-2000s. Shopko I'm not sure of, and it might make for an appealing store if Albertsons partnered with it/bought it, but Albertsons has its own problems to put it lightly. Fred Meyer has also suffered due to Kroger making it more like a supermarket rather than a superstore, and I don't know what's Meijer up to recently.
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Re: Phoenix Flexible Format Target Opens

Post by storewanderer »

Make no mistake, millenials love Wal Mart. Millenials also love to say they like Whole Foods, Trader Joes, Total Wine, etc.

I do not think millenials are terribly enthused, or even very heavy users, of the conventional food/drug combo store. And that is something that should be of major concern to Kroger, Albertsons/Safeway, etc. It is possible as millenials get older, have families, etc. they will warm up to the format. Or will they just use Wal Mart (or whatever other Supercenter format exists- looking like going forward Meijer will be the only other one)...

Target was a store loved by young people 10-15 years ago.

I don't think it is anymore, based on who I see shopping there. Target has simply lost focus and a new batch of customers is out there now who does not really understand what Target is or what it stands for. It looks like a "me too" to Wal Mart but with less items, fewer locations, and perceived higher prices. It kind of reminds me of when I used to look at Shopko next to Wal Mart, Target, Kmart, etc. It just... wasn't as good. Wasn't as complete, despite doing some things better than the others, never defined itself with the customer, and ended up failing in my market. As has been said here, it is hard to understand what Target is doing. These new small format stores confuse the customer. Bringing in CVS Pharmacy confuses the customer. Did CVS buy Target? What about the other items? Does Target now have prices like CVS? Why can't I use an Extra Care Card at Target? What happened to those cool pill bottles and cool lids that Target Pharmacy offered?
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Re: Phoenix Flexible Format Target Opens

Post by HelloOutThere »

I was in the Redondo Beach / South Bay Galleria Target yesterday. I noticed many, many yellow "New Lower Price!" tags on items throughout the store in all departments. First I've noticed something like that from Target. My personal impression is that Target's prices were creeping up, so maybe they've somehow gotten the message.

Regardless, every time I go to Target it feels more and more "curated." I noticed it especially in tissue (Kleenex) and paper towel selection. Meanwhile, the Grocery section took up a large part of a corner of the store. It felt dark, dingy, and depressing. Hardly any customers in grocery, none in the fresh area. They really need to brighten up the grocery sections. The gray and red walls just feel dark, and nothing feels fresh (Pfresh?).
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Re: Phoenix Flexible Format Target Opens

Post by storewanderer »

I noticed those lower price tags here recently and the price points looked pretty strong. But will they keep these price points?

I also got annoyed with them increasing item prices when an item was on Cartwheel, then decreasing it again when the item went off Cartwheel.
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Re: Phoenix Flexible Format Target Opens

Post by pseudo3d »

storewanderer wrote:Make no mistake, millenials love Wal Mart. Millenials also love to say they like Whole Foods, Trader Joes, Total Wine, etc.

I do not think millenials are terribly enthused, or even very heavy users, of the conventional food/drug combo store. And that is something that should be of major concern to Kroger, Albertsons/Safeway, etc. It is possible as millenials get older, have families, etc. they will warm up to the format. Or will they just use Wal Mart (or whatever other Supercenter format exists- looking like going forward Meijer will be the only other one)...
Walmart is used because it's cheap (millenials are not as wealthy as baby boomers--they may SAY they like WFM and the like, but in reality Walmart captures the shopping dollars), and I think it does have that "all in one" aspect that makes it loved. If it wasn't for that, then it wouldn't do nearly as well. It isn't "trendy" but it gets the job done. As for combo food/drug stores, they were never anything to write home about save for the 1970s-era Skaggs Albertsons stores. But some chains DO have followings (H-E-B, Publix, Wegmans) because of their generally good structure and brands. It would be difficult for Kroger and Albertsons to achieve that because of their availability everywhere and their highly fragmented brand name structure (Albertsons moreso than Kroger especially since taking on the Safeway stores), and there's nothing really "special" about them, no matter how much spiff they put into their flagship stores.
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Re: Phoenix Flexible Format Target Opens

Post by wnetmacman »

pseudo3d wrote:Walmart is used because it's cheap (millenials are not as wealthy as baby boomers--they may SAY they like WFM and the like, but in reality Walmart captures the shopping dollars), and I think it does have that "all in one" aspect that makes it loved.
Walmart is used because it's there, and it's open. Walmart beats Target in locations alone by a nearly 3-1 ratio. They beat Kmart by almost a 10-1 ratio now. The All-In-One aspect is a plus, but it's not a reason I shop there. I seldom buy groceries there, because other places have fresher food and better deals.
pseudo3d wrote:If it wasn't for that, then it wouldn't do nearly as well. It isn't "trendy" but it gets the job done. As for combo food/drug stores, they were never anything to write home about save for the 1970s-era Skaggs Albertsons stores.
Not even the S-A stores were that great. The largest issue all of them had was price. At the time, nobody outdid Kmart on price, especially the food/drug combos, including Kroger and Albertsons. That's why none of them really lasted outside the 80's.
pseudo3d wrote:But some chains DO have followings (H-E-B, Publix, Wegmans) because of their generally good structure and brands. It would be difficult for Kroger and Albertsons to achieve that because of their availability everywhere and their highly fragmented brand name structure (Albertsons moreso than Kroger especially since taking on the Safeway stores), and there's nothing really "special" about them, no matter how much spiff they put into their flagship stores.
HEB, Publix, Wegmans and the like have the followings they do because they do what folks in their respective areas want. They also stay regional because when they try other things (HEB in Louisiana is a key example), they fall flat because they don't understand that area. Kroger and Albertsons are national retailers, but in just about every area they operate, someone local does things better than them, because their scale doesn't allow them to think small.

I would still say Kroger's name recognition is a major drawback for them. While Albertsons has many multiple names, Albertsons and Safeway are the two primary nameplates. Where the confusion comes in is that they use both interchangeably throughout their marketing, where Kroger keeps one name in one place, largely. King Soopers is Colorado (though City Market has some stores away from KS), Ralphs is California, etc. You can have Safeway on one side of town, Albertsons on the other, and they compete against each other at times.
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Re: Phoenix Flexible Format Target Opens

Post by Super S »

wnetmacman wrote:
I would still say Kroger's name recognition is a major drawback for them. While Albertsons has many multiple names, Albertsons and Safeway are the two primary nameplates. Where the confusion comes in is that they use both interchangeably throughout their marketing, where Kroger keeps one name in one place, largely. King Soopers is Colorado (though City Market has some stores away from KS), Ralphs is California, etc. You can have Safeway on one side of town, Albertsons on the other, and they compete against each other at times.
One major exception for Kroger though are the areas of the Pacific Northwest where Fred Meyer and QFC have stores in the same markets. Although QFC does not have nearly as many locations as Fred Meyer.
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