Amazon VS Target: The Ultimate Retail Rivalry

Globally, the eCommerce sector is expanding steadily. New eCommerce markets are developing every day, and already-existing markets are hitting new benchmarks. In the eCommerce space, Amazon and Target are well-known competitors, each with special advantages and tactics. Amazon has managed to hold its position as the world's largest online retailer through its extensive range of goods, effective shipping services, and cutting-edge technologies such as Alexa. In contrast, Target has been focusing on the combination of its physical shops and online presence, providing a carefully chosen assortment, special collaborations, and efficient same-day services. Let’s see what the eCommerce giants, Amazon and Target, have been doing so well that made them what they are today by going through their businesses and comparing them. 

Amazon - About
Target - About
Biggest Assets

• Target’s Physical Stores Strategy
• Amazon’s Click and Collect & Locker Strategy

Financials: Amazon & Target
Technology and Supply Chain
Customer Loyalty Programs
Marketing Strategy
Can Target Catch Up with Amazon?
What Lies Ahead?

Amazon - About

Jeff Bezos founded Amazon on July 5, 1994, out of his Bellevue, Washington, garage. It is an American multinational firm focused on digital streaming, cloud computing, eCommerce, online advertising, and artificial intelligence. Amazon allows any vendor to sell anything, taking a cut from every sale. It started as an online bookstore but has since extended into many other product categories, earning the nickname "The Everything Store."

As one of the most valuable brands in the world, Amazon is sometimes referred to as "one of the most influential economic and cultural forces in the world" today. It is regarded as one of the Big Five American tech companies, along with Microsoft, Apple, Alphabet (the parent company of Google), and Meta.

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Target - About

Target has been around for 100 years (founded in 1902) and was founded by George Dayton. However, the rebranding process that made Target the success we all know today was started in Minnesota and developed through the years via expansion and acquisitions. The American retail company Target Corporation runs a network of hypermarkets and cheap department stores.

Target is well-known for emphasizing high-end, fashionable goods at reasonable prices. Along with groceries, its stores usually sell a variety of miscellaneous products, such as toys, electronics, clothes, home goods, and more. Bullseye is the name of the company's canine mascot, and both the name and emblem allude to the center of a shooting target. It has continuously been recognized as one of the most philanthropic American businesses.

Target - Seventh Largest Retailer in the United States

Target Corporation also known as Target, is an American department store chain. It was set up in 1962 as a division of Dayton’s department store.

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Biggest Assets

Target’s Physical Stores Strategy

Target relies on its physical store network to compete in the Shipping Wars as an underdog. Target uses its stores as fulfillment centers for online orders. This reduces shipping costs and competes with Amazon's quick delivery.

Target's approach is motivated by the necessity to maintain efficiency and competitiveness in the quickly expanding eCommerce sector, but it also attempts to address environmental issues by lowering carrier mileage and grouping shipments.

By the end of 2026, Target wants to have 15 sortation centers in its network thanks to an investment of $100 million. A sortation center is a logistical facility that brings together, sorts, and distributes the flows passing through it.

Amazon’s Click and Collect & Locker Strategy

Amazon now offers small and medium-sized companies who sell on its marketplace a click-and-collect option. Certain items on Amazon.com can be bought and collected from a nearby shop on the same day. Sellers can also offer same-day delivery using their drivers and vehicles. In addition to the foot traffic that stores receive from Amazon, Click & Collect in-store offers the advantage of attracting new consumers, facilitating interaction between store staff and customers, and the sale of additional products and after-sales services. In addition, this improves the store's visibility and allows customers to discover the entire range of a store. 

When you shop at Amazon, it’s easy to receive your purchases. Sometimes you may want your package delivered to a different place, not your home or work. You can choose a secure pickup location for your Amazon orders with Amazon Locker. You can pick up your packages on your own time and rest easy knowing they’re safe in the meantime. Shipping to a Locker is free for Prime members.

Financials: Amazon & Target

The online shopping giant Amazon didn't appear to be slowing down. According to Citi Research, Amazon's Gross Merchandise Value increased by more than 12% over the previous year, surpassing the eCommerce industry average of 8% growth.

 Sales at Amazon increased by 13% in 2023 third quarter to $127.1 billion in 2022. Additionally, Amazon's global sales increased 16% annually to $32.1 billion. Amazon Web Services, or AWS, saw a 12% rise in sales to $23.1 billion in 2016.

For Target, in the 2023 third quarter, comparable sales fell by 4.9 percent, which was caused by a 4.6 percent fall in comparable store sales and a 6.0 percent decline in comparable digital sales. With $25.4 billion in total revenue, it was 4.2 percent less than the previous year due to a 4.3 percent reduction in overall sales and a 0.6 percent decline in other revenue.

For these retail giants, the upcoming quarters will undoubtedly be a test of their courage, inventiveness, and adaptability. The struggle for American consumers' wallets is far from over.

Technology and Supply Chain

Both companies are using their technology to innovate and work towards the betterment of the Supply Chain. Amazon is developing a range of supply chain solutions for small and midsize enterprises by combining its vast eCommerce shipping network with its AWS cloud computing capabilities. The tech behemoth unveiled Cardinal and Sparrow, two new intralogistics robots, in 2022. These robots can currently be used to collect items of various sizes, shapes, and materials, transfer things across the fulfillment center, and sort parcels. Amazon has been investigating package delivery using drones. The goal of the Prime Air project is to create a drone delivery system that can deliver packages in under 30 minutes.

On the other hand, Target has invested in digital marketing techniques, website and app upgrades, and better online purchasing. By the end of January 2026, the store hopes to have at least 15 of these locations, known as sortation hubs. Along with increasing its curbside pickup and same-day delivery options for alcohol, Target has also added its highly popular in-store Starbucks cafes to its lineup.

At roughly the same time that Amazon announced its pursuit of a net zero carbon certification for a new Amazon Fresh in Seattle, Target opened its first net zero energy store in Vista, California.

Customer Loyalty Programs

Every organization needs to create loyalty programs that would help retain customers. Amazon's plan to improve its ecosystem and consumer loyalty also includes the creation of Amazon Prime, which offers advantages including free shipping, Prime Video, Prime Music, and more.

On the other hand, Target provides Target Circle, with a free loyalty program. Target Circle offers benefits without charging a price, even if it doesn't have as many advantages as rivals like Amazon Prime.

Members can vote for local charities in their communities that Target should donate to, as well as access services that are personalized and pertinent to them. Currently, the program has over 120 million members, making it one of the largest and fastest-growing loyalty programs. 

Marketing Strategy

Amazon uses a broad and all-encompassing marketing approach to keep its position as the world's largest online retailer. Perhaps one of the greatest pieces of Amazon’s marketing strategy is the opportunity for customers to post reviews. 93% of people look at online reviews before making a purchase, proving why this strategy is so effective.

Sellers can advertise their products on Amazon using a variety of ad types thanks to the company's advertising platform. Display ads, video commercials, and sponsored products are a few of the advertising options that Amazon provides. To strengthen its social media presence, it has also collaborated with several content producers.

Target sets itself apart from the competition with its selection of distinctive in-house brands and carefully chosen national brands. It effectively meets the needs of its customers, whether they make purchases in-person or online, by using its stores as fulfillment centers.

Additionally, to preserve and improve relevancy, it interacts with customers through initiatives like RedCard and Target Circle. Target uses its corporate sustainability plan, Target Forward, as its main tool to harness for the good of people, the environment, and the company.

Can Target Catch Up with Amazon?

There were empty brick-and-mortar chains with vacant parking lots when the world came to an abrupt stop in March 2020, but none could compete with Amazon's massive data collection, logistics, and pricing structure. 

Target, however, is gaining traction now that customers are coming back by taking advantage of the one asset that Amazon does not have: a physical store network.

Target has just 1.8% of the eCommerce market share in 2023 compared to Amazon’s 37.6% as per the reports. To manage high volume and boost efficiency, Target constructed sortation centers. This led to a 150% increase in next-day delivery and tens of millions of dollars in savings. 

 According to Target, customers appear to still value personalization; click-and-collect sales are soaring at its nearly 1,900 US stores. While it may have sounded counterintuitive at the beginning of the pandemic, the combination of eCommerce and physical retailing makes sense today, which is why Amazon is making significant investments in its network of stores.

What Lies Ahead?

For small businesses, Amazon has introduced a "buy now, pay later" option that lets them buy products on credit. But the Ninja cautions that depending on debt to expand a business can be dangerous, particularly for one-person operations where the debt is personally guaranteed. Brian Cornell, the CEO of Target, has drawn attention to a worrying trend in which consumers are cutting back on spending, even on groceries which is a sign of financial strain. 

Amazon is still the industry leader in eCommerce right now, but Target has made considerable advances in the online space because of its omnichannel strategy.

Conclusion

Target has established itself as a strong rival by utilizing its advantages in both online and offline retail, while Amazon continues to be an eCommerce giant that sets industry standards. The future landscape for these organizations and others in the industry will surely be shaped by the continued expansion of the e-commerce market.

FAQs

What are sortation centres?

A sortation center is a logistical facility that brings together, sorts, and distributes the flows passing through it. By the end of 2026, Target wants to have 15 sortation centers in its network.

When was Amazon founded?

Jeff Bezos founded Amazon on July 5, 1994.

When was Target founded?

Target has been around for 100 years (founded in 1902) and was founded by George Dayton.