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Target to roll out free shipping for the holidays

Halloween may still be several days away, but retailers are rolling out their holiday programs.

Target said Thursday it will drop the minimum purchase requirement for free shipping for shoppers on its website between Nov. 1 and Christmas.

Target had a $50 threshold for free shipping, but in the wake of the strong holiday response, the big box retailer in February slashed the threshold to $25.

Free shipping is a popular perk. Already, Best Buy said it will waive its $35 free shipping threshold through early January. Toys 'R Us cut its threshold to $19 from $49, but Wal-Mart said it is sticking with its $50 minimum to qualify for free shipping during the holiday season.

Shopper Maria Montoya of Eagle Rock, California looks for more bargains as she wheels her cart piled high with Christmas gifts through her local Target store
Robyn Beck | AFP | Getty Images
Shopper Maria Montoya of Eagle Rock, California looks for more bargains as she wheels her cart piled high with Christmas gifts through her local Target store

Target spent $1 billion this year to upgrade its e-commerce platform and supply chain, but the work continues. CEO Brian Cornell said this year 460 stores will be used to ship products to consumers, up from 100 last holiday season, but still well shy of the 1,805 stores in its network.

The retailer is also adding to its curbside pickup service, expanding from 21 to 121 locations in Philadelphia, San Francisco Bay Area, and select locations in New York, New Jersey and Chicago.

Cornell said additional capabilities have been added to its website so that shoppers will now get an exact date for delivery, rather than a time window.

The last day for guaranteed Christmas delivery will be Dec. 21, one day beyond last year.

While Target's foray into Canada was short-lived after Cornell decided to close the underperforming business altogether in January, it hasn't given up on international expansion quite yet.

Target is partnering with Border Free to allow consumers in 200 countries to shop on its website this holiday season.

"We knew that we had a lot of guests outside the United States browsing our site, but until now they haven't been able to buy," Cornell explained. While Target doesn't expect the effort to be a significant driver of business in the beginning, the retailer does expect to learn more about what shoppers outside the U.S. are looking for at Target.


Metallics, sequins and fur

Target expects toys to be a big hit this holiday season, and cited "Star Wars" items and drones as examples. Julie Guggemos, senior vice president of product design & development, said the retailer will carry 18 exclusive "Star Wars" items and 20 different kinds of drones in-store and 80 online, ranging in price from $99 to $499.

When it comes to the hot products to celebrate the season, Target is going big on merchandise with what Guggemos calls "fur and shine." From tabletop goods and home decor to gifts and apparel, the trend is metallics, sequins, and fur.

Target also plans to display apparel using mannequins in 1,400 stores. According to Guggemos, stores that use mannequins have seen sales rise by 30 percent.

A similar number of stores will also see new product displays in the home department, which also can bump up sales by a factor of three to four times, the company said.

Target is upping its game and opening its wallet when it comes to marketing for the holidays.

"Last year we spent the most we ever had on digital marketing, with 51 percent. This year, it's going to be 61 percent," said Target Chief Marketing Officer Jeff Jones.

Part of the marketing budget will be directed towards what Target calls "the Holiday Odyssey," a season-long storytelling campaign that follows three children on a mission to light a Christmas tree. There will a social media campaign, as well.

Jones said its "wish list" app for kids was enhanced with new search and scan abilities, and the ability to send and receive a letter from Santa.

No word on Black Friday... yet

Target remains tight-lipped about its Black Friday plans for now, other than to assure it will be open and ready.

Outdoor co-op retailer REI may be shutting its doors on Black Friday, but that's not something CEO Cornell expects to happen at Target anytime soon.

"I still think Black Friday is still a very important part of the holiday season. It really is the start of the holiday season," said Cornell. "It may not be building momentum, but it's not going away. If we took it away from our guests, they would be pounding the doors outside wanting to get in."