In its second-largest acquisition, Amazon buys the company for $970 million.
After two years in development, Target Corp. unveils a redesigned web site.
Target Corp. today unveiled its redesigned Target.com, an e-commerce site that the retail chain says features more product recommendations, better gift registries and improved graphics—and which cuts Target’s decade-long reliance on Amazon.com Inc.’s e-commerce platform.
“Establishing a new platform for Target.com allows Target to reinvent our guests’ online environment and create a more user-friendly, reliable experience,” says Steve Eastman, president of Target.com. Target Corp. is No. 22 in Internet Retailer’s Top 500 Guide and had Internet Retailer-estimated online sales of $1.33 billion last year, up about 10% from $1.21 billion in 2009.
The launch of the redesigned site marks the end of Target’s relationship with Amazon, No. 1 in the Top 500 Guide. Target.com ran on Amazon’s e-commerce platform for the last 10 years and the retail chain also used Amazon services for fulfillment and web hosting. The outsourcing cost Target a hefty commission on online sales, an amount estimated at $100 million annually by investment firm Robert W. Baird & Co. In 2009, Target announced it would migrate from Amazon’s e-commerce platform when its contract expired in 2011.
“We believe that e-commerce became strategically too important for Target to outsource this business to Amazon, in particular given the increasing competition between the two companies,” says Colin Sebastian, a Baird analyst, in a research note today. Other multichannel retailers that sell merchandise in the same product categories as Amazon, including Toys ‘R’ Us (No. 29) and the late Borders (No. 200), have in recent years also severed their ties with Amazon’s e-commerce services.
The redesigned Target.com uses technology from IBM Corp. Additionally, online marketing agency Huge helped to build the site’s look. Target says the redesigned site has better site search and navigation, thanks to Endeca Technologies Inc., Target’s site search vendor.
Consumers also will notice a faster checkout process on the new site, Target says, and will be able to upload photos and videos to product reviews.
AT&T hosts the site.