Target's AI Transformation: Pioneering Personalized Experiences in the Grocery Environment

In today’s competitive grocery landscape, Target is transforming how it engages with customers and employees by embracing Artificial Intelligence (AI) across all critical touchpoints. Beginning at the first customer interaction and continuing throughout the shopping journey, Target leverages AI to deliver 1:1 personalized content, recommendations, and offers in real-time, pushing the boundaries of customer experience within the grocery environment.

Omnichannel to Adaptive Grocery: A Shift Towards Personalization

Like many leading grocers, Target recognizes the importance of personalization in today's grocery industry. While omnichannel strategies are essential, Adaptive Grocery goes further, allowing Target to guide shoppers with hyper-specific recommendations and tailored experiences throughout their journey.

As highlighted in the Q3 Digital Performance Scorecard, Grocery Doppio’s, digital grocery sales accounted for 13.2% of total grocery sales year-to-date, signaling a major shift toward online grocery shopping. To capitalize on this trend, retailers like Target are leveraging AI to meet customer demands for personalization. By adopting AI-driven shopper segmentation and targeting capabilities, Target is well-positioned to enhance conversion rates and exceed shopper expectations in this new era of Adaptive Grocery​.

Moreover, as AI continues to evolve, personalization remains one of the most promising areas for grocers. Our survey shows that adopting shopper segmentation and targeting capabilities leads to an average 6.2% increase in conversions. In fact, 91% of grocers reported higher conversion rates due to improved personalization strategies such as targeted marketing and segmentation​.

AI-Driven Personalization Strategies in Target's Grocery Operations

Target has embraced several AI tools to create a seamless and personalized grocery shopping experience:

Generative AI for Product Descriptions and Search‍

Target has improved more than 100,000 product pages using Generative AI. This ensures that product descriptions are relevant, helping customers find the groceries they need more easily​

AI-Powered Guided Search‍

Target’s guided search feature on Target.com lets shoppers use natural, conversational terms to find groceries. The AI engine provides personalized suggestions, ensuring customers find all necessary items, including those commonly forgotten, such as outdoor supplies​

Employee Empowerment Through AI

‍Target's Store Companion, a GenAI-powered chatbot, assists grocery store employees by answering process-related questions and supporting day-to-day store operations. This allows staff to focus on providing better customer service​

Personalization and the Future of Grocery at Target

As AI in the grocery environment continues to evolve, Target is leading the way by adopting AI technologies that enhance both customer and employee experiences. In 2023, AI integration impacted 72% of grocers, a figure that increased to 76% in 2024, with many realizing the immediate value AI brought through product recommendations and personalized promotions​

By integrating AI across both digital and in-store experiences, Target positions itself as a leader in Adaptive Grocery, delivering hyper-specific recommendations that meet customer needs in real-time. As more grocers adopt shopper segmentation and personalization strategies, the industry is set for continued growth.