Target Moves to Ignite Stagnant Electronics Sales This Holiday Season

Target's (TGT) Chairman and CEO Brian Cornell readily concedes the electronics business has been a challenge for the discount retailer for a while now. 

"We have been talking about the challenges we, and the industry, have faced in electronics. There aren't any secrets that for several years now we have seen pressure in the category. Part of that has been due to a lack of newness in the category," Cornell said in an interview Tuesday.

To jump-start growth in electronics this holiday season, Target is taking a two-pronged approach.

First, it will pack its shelves with a host of new products such as Sony's (SNE) virtual reality goggles, the latest smart watch from Apple (AAPL) , and connected home gear from Alphabet (GOOGL) .

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Second, Target will take a page from the playbook of fellow Minnesotan Best Buy (BBY) and add tech specialists to its electronics department across some 1,500 stores. Sporting black shirts, the specialists will help consumers better understand how to get the most from the latest tech gadgets.

Adding specially trained employees to important departments such as electronics isn't totally foreign to Target -- over the past year, the retailer has installed them in its beauty, food and apparel departments.   

"We recognize there are a number of areas in our store where we need more dedicated expertise, and we are seeing a great response where we have put that in place," Cornell said. 

Target is clearly trying to prevent what happened during the second quarter in electronics from spilling over into the important fourth quarter. 

Sales of Apple products plunged 20% at Target in the second quarter, due mostly to a lack of new product introductions from the tech giant. That resulted in a double-digit percentage sales decline in Target's electronics business.

Weakness in electronics did its part to send second-quarter same-store sales down 1.1%, a sharp reversal from a 2.4% increase a year ago. It marked the first time Target delivered a same-store sales decline since a 0.3% drop in the first quarter of 2015, according to Bloomberg data.

"We have focused on innovation and newness from a number of partners such as Sony and Apple, which is all part of us trying to reinvent the electronics space to bring relevance to a consumer that looks to electronics as a very important holiday gifting category," said Cornell.

Hopefully for Target, busy holiday shoppers notice the changes.

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