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Target Considering New Paid Membership Programme: Report

By Reuters
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Target Considering New Paid Membership Programme: Report

Target is weighing a new paid membership programme for its customers similar to Amazon and Walmart, Bloomberg News reported, citing people familiar with the matter.

The new programme, internally titled as Project Trident, could launch as soon as this year, the report said.

Target did not immediately respond to a Reuters request for comment.

It will be a late entrant into the market of paid membership and will have to compete with Amazon's Prime, Walmart Plus and Kroger's Boost programmes.

An Amazon Prime membership costs $14.99 per month, or $139 per year in the US, while Walmart Plus offers plans for $12.95 per month, or a yearly plan for $98.

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Paid Membership Programme

Paid memberships usually get customers access to free deliveries on their orders, while getting additional deals and discounts, driving more revenue for companies.

Target has been dealing with sluggish sales over the past year as Americans cut back spending on discretionary products that make a larger part of the retailer's product assortments.

The company already offers a free loyalty programme to its customers, called Target Circle, where shoppers can access more deals and discounts on their purchases.

Bloomberg said Project Trident could add could also incorporate Shipt, the grocery-delivery business it had bought in 2017.

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Holiday-Quarter Outlook

In November of last year, Target forecast holiday-quarter profit largely above Wall Street expectations as the big-box retailer benefits from easing supply-chain costs and its efforts to control inventory start to pay off.

The company expects adjusted earnings of between $1.90 and $2.60 per share in the fourth quarter. The midpoint of that range topped analysts expectations of $2.22 per share, according to LSEG data.

Last month, the company named finance chief Michael Fiddelke its new chief operating officer, effective 4 February, replacing long-time executive John Mulligan.

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