Target CEO claims customers are saying 'a big thank you' for locking up merchandise
- Target is fighting theft at its stores in part by locking up everyday items.
- CEO Brian Cornell claimed customers are saying "a big thank you" because merchandise is in stock.
- Target has repeatedly said theft is cutting into its profits, at a time when it has struggled to grow sales.
As Target tries to fight theft at its stores, it has left customers frustrated to find many everyday items locked up.
Still, the retailer's CEO, Brian Cornell, claimed many shoppers are actually grateful to see their body wash, toothpaste and deodorant behind a glass panel.
On a media call with reporters discussing Target's fiscal third-quarter earnings, CNBC asked Cornell if the retailer can quantify the sales lost from shoppers who are frustrated with waiting for employees to unlock cases in-store. He said the shopper response to the policy has been "positive."
"Courtney, just in the last week I've been on the East Coast and on the West Coast in many of those stores that you've talked about where, items have been locked up," he said. "And actually what we hear from the guests is a big thank you, because we are in stock with the brands that they need when they're shopping in our stores. And because we've invested in team member labor in those aisles and make sure we're there to greet that guest, open up those cases and provide them the items they're looking for."
CNBC again asked Cornell to confirm that Target hasn't seen a measurable drop in sales or traffic in those stores because of the inconvenience of having to wait for items.
"Courtney, in many cases, it's just the opposite. The fact that we're in stock is what's most important for the guests," he said. "And they understand the fact that we've had to make some changes to ensure the safety of the product and the fact that they have product in stock when they're shopping the stores."
Theft continues to pressure Target's financial results, company executives have said. The retailer has repeatedly said stolen items have hurt its profits, at a time when sales have stagnated and the company struggles to recapture the growth it saw during the Covid pandemic.
Target blamed theft for its decision to close nine stores during the third quarter in New York City, the Bay Area in California, Seattle and Portland, Oregon.
Like other retailers, Target has put many items in locked cases in stores where theft is a bigger problem.
The move comes after Target invested billions to improve the shopper experience and make stores more convenient. It has remodeled locations and launched programs like "Drive Up" where orders, including a fresh Starbucks beverage, are loaded directly into shoppers' cars, without them ever having to get out.
Twenty-six percent of consumers surveyed by Coresight Research in August said they would shop elsewhere, and 26% said they would move online, if their local store put items under lock and key.
A number of shoppers have expressed frustration on social media platforms about the inconvenience of waiting for store employees to unlock a case in order to get a product off a shelf.
Kurt Jetta in Delray Beach, Florida, wrote on X, formerly known as Twitter: "Hey .@Target! You can't lock stuff up to prevent theft, and then not have a sales person anywhere within shouting distance to get it out. How many electronics and shaving sales have you lost because of that? Definitely lost a $300+ basket from me."
In a response on the platform, the retailer said it aims to "provide our guests with an easy shopping experience" and for the date and location of the incident to review it further.
Target executives said on the media call and in its earnings conference call with analysts that its merchandise in-stock levels are the best in four years. Inventory fell 14% year over year, with a 19% reduction in apparel, a category where Target has seen soft sales for several quarters.
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