Target has pulled out the big guns in its race to beat Amazon this holiday season.
The Minneapolis-based retailer said today it is providing free shipping online — no minimum purchase required — starting immediately and lasting until Dec. 20.
The move takes direct aim at Amazon.com, which requires $30 minimum purchases for free shipping or a membership to Amazon Prime, which costs $99 a year. Free shipping will be offered on orders taking three to five business days, and customers can elect to pay more to get those orders expedited. The brick and mortar retailer is also emphasizing in-store pick-up, something that Amazon cannot offer as an online-only company.
Target says it will allow customers to shop for more than 65,000 items online and pick them up in the store within an hour (on 80 percent of all orders).
“We recently made the decision to offer free shipping throughout the season,” said Target CEO Brian Cornell, in a statement. “It’s an easy way to eliminate one of the most common hurdles that’s associated with online shopping. No one likes being surprised with shipping charges when they go to check out, so a standing free shipping offer for the holidays just makes sense.”
Typically, around this time of the year retailers offer additional incentives for customers to order online, like free shipping. But by lifting the requirement to make a minimum purchase, customers will be able to place orders daily if they wish, buying one item at a time — which is often the behavior that many Amazon Prime members exhibit.
What’s notable is that Amazon’s prices frequently are marked up to take into account shipping costs, but with Target that doesn’t seem to be the case.
Here’s one example that makes the point, although this is by far scientific. A heavy box of baby formula on Target costs $23, and ships for free. The exact same brand and size on Amazon costs $31.79 and requires Prime for free shipping. A non-Prime eligible version costs $24 plus $5.50 for shipping, making it more expensive than Target, as well.
Of course, comparing Amazon to Target isn’t entirely fair. Amazon Prime offers additional perks, such as free video and music streaming, and offers two-day shipping, rather than the three to five days that Target offers. Depending on what you are looking for, it could be a better value long-term. As the holidays near, expect more retailers to jump on the free shipping bandwagon.
Target also made a couple of other holiday announcements:
- Target will launch a Wish List app on Oct. 31 (Amazon said last year one in three customers worldwide wished for an item, translating to 50 items being added to Amazon Wish Lists every second). Target customers will be able to save 10 percent on their Wish List on one day of their choice before Nov. 26. The app can be downloaded on Apple and Android devices and printed on the registry kiosks in Target stores.
- New mobile and tablet apps are re-launching, making it easier for guests to locate and purchase what they’re looking for using interactive store maps and shopping lists as well as streamlined checkout including, Apple pay in the iPhone app.