MINNEAPOLIS — Target Corporation is investing billions of dollars this year in an effort to reverse ongoing sales declines and restore its reputation as an appealing destination for affordable fashion, home goods, beauty items and groceries.
Leading this recovery effort is Michael Fiddelke, who assumed the chief executive position last month after more than two decades with the retail chain.
Fiddelke, formerly the company’s chief operating officer, faces significant challenges ahead. Some shareholders had hoped for external leadership when Brian Cornell departed after serving as CEO for over 11 years. This week, the discount retailer reported another quarter of falling comparable store sales. The company also encountered demands to publicly oppose immigration enforcement actions in Minneapolis, its corporate home base.
In a recent conversation with The Associated Press at Target’s corporate offices, Fiddelke discussed his approach to revitalizing stores and product offerings, rebuilding customer confidence, and managing political and economic pressures that have intensified the company’s challenges. The discussion was condensed for brevity and clarity.
“Prove is the right word. It’s a ‘Prove it’ story,” Fiddelke said. “I have the benefit of a 23-year running start that has taught me so much about how retail works. I’ve gotten to see Target at its very best. I’ve gotten to see us when we are not at our very best, and that leads (to) a real clear view for me of when we’re hitting on all cylinders. It means even being candid on the stuff that I had my fingerprints on. I was COO for two years. I was CFO for some times that were great, and some times that weren’t.”
“So as long as I’m able to couple — and I believe I can — the benefit of that experience with clear-eyed candor about where we’re at and where we need to drive change, I like that combination,” he added.
Regarding the company’s design approach, Fiddelke explained: “One of the things that’s critical to being design-led is you have to have an environment that fosters creativity in the right way. And I think if you were to pull any buyer into this discussion, they would say that outside stimulus of what’s different, what did I just see, that can often come in travel to other markets. The Alpine Chalet that you saw in our stores just this recent (fourth quarter) — the inspiration for that was from a European Christmas market trip. Where we lost it was during the pandemic. Travel was limited for a couple of years. We’re back to full form now. It probably took us a little longer than it should have, but it’s all about creating the conditions for creativity.”
When asked about learning from the company’s history, he noted: “I think that history can be instructive on centering who we are in our core. That’s different than nostalgia for nostalgia’s sake. And so there’s an important balance to hold in our heads where spending time in the archives, spending time talking with leaders who have led Target at different chapters. That’s all helpful. And you can’t just fall in love with nostalgia. The playbook from 10 years ago is not going to win in today’s retail.”
Addressing Target’s community involvement, Fiddelke stated: “I’ve been at Target 23 years. It has certainly been true in every single one of those 23 years that Target has a deep history of being a productive partner in the communities in which our 2,000 stores operate. And our roots run deep there. Companies of our scale giving 5% of our operating profits back into community. You don’t find a lot of those. And so knowing kind of core truths about who we are, our role in community, matters. Investment in team matters. Target being a place for everyone matters. The teams we build that reflect the communities that we serve, that’s true for the guests in our stores, that’s for the partners that find a place on our shelf.”
Regarding customer trust issues, he acknowledged: “As we went through last year, it was one of the things that impacted our sales. And so we know we’ve got trust to win back with guests, and we’ll be focused on doing it. There’s no easy button to win back trust, but we’ll do the work.”
On navigating current challenges in Minneapolis, Fiddelke emphasized: “When I think about navigating the start of the year here, especially in our hometown in Minneapolis, the thing that we have kept front and center every single day is the safety of our team. And so the safety of the team and the safety of our guests has been our North Star for decision making, and that’s guided every decision that we’ve made.”
Concerning recent performance, he said: “Even over the course of the last year, even at the end of the year, we saw a business that, broadly speaking, was below where we expected. And so, I’m not satisfied with our performance in total. I wouldn’t call out any specific subgroups within that.”
“I think we’re an emotional brand. We’re a brand people love,” Fiddelke noted. “And the thing I can say is we hold ourselves to a high standard in the product that shows up on our shelves and the experience that we create and the way we show up in the community. So I can’t speak for everyone, but we know where we’re focused.”
His strategy moving forward focuses on controllable factors: “The best thing for us to do is always focus on a clear strategy. Control what we can control. I think over the past several years, there’s been a lot of volatility to manage in the environment. There’s a lot that falls into the we-can’t-control-it bucket, whether it’s the global pandemic or whether it’s changes in policy. And so the right thing for us to do is to be laser-focused on how do we best show up for all those families and guests that depend on us every day.”
Describing employee morale, Fiddelke concluded: “If I had to characterize what I’m hearing from the team, it’s a team that’s hungry to win. There’s so much pride in Target and there’s so much excitement to get this company back to growth. And I think just like I’m not satisfied with our performance the last few years, a team would tell you the same.”
