Target Corp. (NYSE: TGT) will be divorcing itself from longtime online selling partner Amazon.com (NASDAQ: AMZN) in 2011 as it builds its own website and starts having a more direct relationship with its own online customers.
Target and Amazon.com, which began their partnership in 2001, have been the largest example of a large mass retailer teaming up with a leading online retailer to handle such areas as e-commerce transactions, online customer service, inventory, site content and shipping, and fulfillment. Sometime before the holiday shopping season of 2011, Target will launch its own, in-house website and will cease to have www.target.com hosted and serviced by Amazon.com.
Steve Eastman, President of Target.com, indicated in the Wall Street Journal (subscription required) that the retailer will be able to "deliver a customized multichannel experience for Target's guests." While it's unclear what difference this makes over the current Amazon.com-powered Target website, Target did say that it wants to take control of the design and management of its own website. The last full-year estimate of profit from Target.com sales on Amazon.com's platform was about $100 million, or less than 1% of Amazon's annual profit. So, the deal -- while a large loss for Amazon.com -- is not a game changer for the company.
One thing is clear -- in two year's time, Target's revamped website better deliver if it indeed launches right before a holiday season. Online shopping won't be slowing down while Target retools itself -- it will only become larger.
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Reader Comments (Page 1 of 1)
8-11-2009 @ 10:18AM
noel@nopun.com said...
I am sure they will do as an outstanding job branding the online experience as they did branding the brick and mortar experience.
Personally I believe that the target was founded by a group of designers looking to design really cool stuff and it so happened to be a discount store.
I can only imagine how ground breaking this new store/site would be...
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Thanks & Regards
Noel from nopun.com
a professional graphic design studio
8-11-2009 @ 11:39AM
Tim said...
Brian,
Your headline is incorrect. Nowhere in the press release does Target say they will stop sales on Amazon.com. They said they will stop having Amazon power Target.com.
There is a difference. I will probably still buy from Target if I can find their products with others on Amazon.com. I don't go to Target.com very often.