E-commerce growth proves the mass merchant is on the right strategic path for serving shoppers, CEO Brian Cornell says. The web accounted for about 28% of the retailer’s sales growth in the quarter.

Target Corp. piled up strong web sales in the first quarter of 2015, reinforcing the retail chain’s long-term plan to invest in e-commerce, chairman and CEO Brian Cornell told analysts on the company’s quarterly earnings call this morning.

“Digital sales growth was driven by higher traffic and a substantial increase in conversions,” Cornell told analysts. Warmer weather and an early Easter boosted store and web sales, but the big event was the launch of the Lilly Pulitzer product line in April. “We were thrilled with overall demand in our collaboration with Lilly Pulitzer, with most items selling out in the first few days,” Cornell said. “We were disappointed, however, that digital channels were not able to accommodate the surge in traffic at the time of the launch and the team is working to address the root causes and learn from the experience as we prepare for the holiday season peak later this year.”

Target.com was down briefly on April 19 ahead of the store launch of the Pulitzer fashion line, and website access was spotty the following day as products sold out quickly.

For the first quarter of fiscal 2015 ended May 2, Target, No. 16 in the Internet Retailer 2015 Top 500 Guide, reported:

  • Digital channel sales accounted for 2.8% of total sales, compared with 2.1% in the first quarter of 2014. Based on those metrics, web sales for Q1 2015 were $479.3 million, up by 37.0% from $349.8 million last year.
  • Total sales were $17.12 billion, up by 2.8% from $16.66 billion.
  • Comparable-store sales, including e-commerce, increased 2.3%, which the company attributed to growth in transaction volume and average order size.
  • Net income of $635 million, an increase of 51.9% from $418 million in the prior year quarter.

The approximately $129 million growth in online sales represents 28% of Target’s sales growth for the quarter, Internet Retailer calculates.


Target continues on its goal of investing more than $1 billion to improve technology in an effort to restructure and build online, or digital, sales. The company’s changes include cutting thousands of jobs over the next two years, which it announced in March.

“We’re encouraged to see early progress on our strategic priorities, including strong sales growth in apparel, home and beauty, nearly 40% growth in digital sales, and positive traffic in both our stores and digital channels,” Cornell said.

Target, whose online and offline sales were badly hit by a big data breach during the 2013 holiday season, is one of three retailers nominated for the “Comeback of the Year Award” at the inaugural Internet Retailer Excellence Awards. The awards will be presented the evening of Wednesday, June 3, at a banquet in Chicago at IRCE 2015, the leading e-commerce conference and exhibition in North America.