Target Should Shut Down Cartwheel

Make sure to start with: Is Cartwheel having an impact on Target in-store sales?

Cartwheel is in Beta, which means that it’s a work in progress. And I’m a firm believe in the Silicon Valley way of launching early and often. However, a key tenet of success or failure for any retailer in the immediate future and for years to come is the ability to provide customers a seamless shopping experience. After 8 weeks on the market, Target’s Cartwheel has not displayed even a minimal understanding of building a seamless shopping experience.

Questionable Product Vision
The demise of Cartwheel starts with Target’s inability to effectively communicate the purpose of Cartwheel. Reading the original press release, executive comments during the May 22, 2013 earnings call, LinkedIn profiles of Target employees/contractors (see the Project section) working on Cartwheel, corporate blog posts, watching the intro video, and using Cartwheel provide conflicting answers. So what is Cartwheel?

It’s first and foremost about Social/Facebook:

-The original press release leads with this

-To use Cartwheel, you have to login through Facebook

-The people working on Cartwheel seem to have been plucked from the ‘social’ world and/or refer to the program as ‘social’

-The earnings call highlights the partnership with Facebook and talks about integrating digital technologies with social media

It’s also about Mobile:

-While Cartwheel started with a website, it was built with responsive web design so it could work across web-mobile-tablet

-To redeem a Cartwheel offer, you can print a barcode or just show the barcode on your mobile device. Which one do you think people will use?

-Cartwheel launched an Android App

-Cartwheel launched an iPhone App

And then it’s about a hodgepodge of other ideas:

-bridging online and in-store with social



-personalized saving app

-fun (for some reason ‘fun’ has been mentioned as often as other ideas)

-easy to use

There’s way too much going on here. If you’re going to launch early and often, make sure you’re focused like a laser on getting one thing right. From there, you can expand the product scope. For example, whittle it down to: a new coupon program. Everyone loves saving money. Simply starting with a new coupon program and getting rid of the social, mobile, fun, personalized, [insert your favorite buzz word] experience would have been a great step. Instead, Target has different players calling it different things, confusing the end user, and I’m sure distracting internal team members from focusing on what’s most important…if they can figure out what’s most important in the first place. I’ve always believed that if a company can’t intelligently and consistently communicate a product vision, then the product is doomed from the start.

Simply put, this lack of cohesive product vision put Cartwheel on a questionable foundation from launch.

If Cartwheel doesn’t work, it’s not Seamless
But back to my original point, smart retailing today is about creating a seamless shopping experience. As Accenture says, this is about “communicating with customers on their terms.” I think somewhere not so deep down, Target thinks this is happening:

-Cartwheel customers can print out a coupon code or use a mobile device to show a coupon. That’s providing choice.

-Cartwheel was developed with responsive design. That’s providing access across web-mobile-tablet.

-Cartwheel customers now have Android and iPhone apps. Mobile apps can take advantage of native functionality and provide a better experience.

-Cartwheel customers can share coupons with friends. Always nice to have a social component.

But Target is wrong if it thinks Cartwheel is a seamless experience.

At it’s core, Cartwheel is about allowing a customer to ‘clip’ a digital coupon and use it in a store. If you can’t deliver the core of the program then you’ve failed at delivering a seamless shopping experience.

From the start, customers had trouble redeeming Cartwheel offers in the store. Why? It’s clear that Target didn’t train its in-store staff on Cartwheel. Target is a $73B behemoth and the company launched a program without properly training staff? I’m laughing and crying as I write this. If you want to laugh and cry along with me, just read the user forum topic: store was clueless. Eight weeks later, you’d figure this problem would be solved. Nope. Here are forum posts from the last 10 days:

The cashiers at my Target were clueless and made me feel like I was trying to scam the store. They didn’t give me all my discounts and gave me an attitude. I just got off the phone with a Target representative and he basically told me to go back to the store to get a price adjustment. My experience was so discouraging that I am not willing to waste my money or time on this until Target gets it together!!! I tried to explain to the representative that they are going to drive customers away if they don’t get their employees up to speed. I was told that Target was the only store that provided promotions to use multiply coupons! BS Target! There are actually other stores that allow stacking and doubling!!!

And FYI Target, you shouldn’t promote a program if you haven’t gotten your employees up to speed on it. I have worked in retail before and the excuse that everyone has a different schedule and that you have many stores is unacceptable. I don’t know understand why you didn’t train the employees by region before you launched it nationally.

Please address what the policy on rectifying the situation where the customer is dissatisfied other than going to customer service to try again??? Just reading the forums this seems to happen nationwide and many customers have gone back and gotten the same or worse attitude a second time! –Diamond Marked

Said they don’t accept mobile coupons. I was like wtf.. This is Targets own app. Every Target I go accepted it (well the web version one). Told me they don’t scan team members mobile coupons. I was like confused what in the world she talking about. Felt like an idiot, aguring and holding up the line. Long story short I opened the web version. Told her and the other employee this is the same EXACT one but without the words “Target team member” so she scan.. I paid and left. This morning I looked at the app again. The words “Target team member” was in large bold lettering” below it in smaller lettering, it says “scan here to apply savings” I guess that’s why she didn’t want to scan she thinks its for employees.. Every Target store should be aware that there’s an app. –Marilyn Davis

The app will not load in the store. The cashiers and customer service did not know what it was. I was told I could go home, print the offers, then come back and customer service would apply the savings. I did that and they still could not figure it out. I only bought certain items because of the discounts, and then I didn’t get the discount!! So far, this is useless to me. –Michele Keys

And maybe most telling is a comment by a Target employee:

As a Team Member at a store near Tampa, Florida, I will say that there *is* info about Cartwheel out there for management to distribute to team members (how well it’s executed is dependent by store. Stores in the Tampa area seem to be up to par IMO). I’ve been to a few local stores and didn’t say anything about Cartwheel; just showed them my phone with the barcode and they scanned it, no questions asked. That being said, it is still definitely a work in progress. I tried using Cartwheel coupons on stuff I wanted to buy. Out of 5 things, 2 things rang up with the Cartwheel coupon, but one with the incorrect percentage and one with $0 off. Not only that, but it froze the register. Very inconvienient for me as a guest, as well as the guests behind me that had to wait for the register to reboot.

As much as I like suggesting ways for our guests to save, I personally cannot recommend this to the guests that shop in my store until it actually works, and works well. Until then, there needs to be communication to stores on what procedure we need to take if/when a Cartwheel coupon doesn’t ring properly to avoid an upset guest. Neither the GSTM nor the GSTL knew what to do in my case as neither had official direction from HQ, but she did end up figuring the values of my Cartwheel coupons out on a calculator and gave me a Store Coupon (which is what I would do, FWIW).

The concept is great, the execution just really sucks unfortunately. It should’ve been a beta for Team Members first like how Target Ticket is, then it should’ve been rolled out to guests as a polished product. –John Brophy (who should be appointed In-Store liaison for Cartwheel)

And there are plenty of other forum topics related to in-store redemption issues. One of my favorites revealed that the Cartwheel coupon had to be scanned after all other coupons or it crashed the cash register. Seriously, read that forum topic. Embarrassing.

It’s unacceptable that people can’t use the product. While I don’t have the data on successful coupon redemptions to unsuccessful redemptions, the fact that so many customers and even some Target employees have gone through the trouble of logging into Get Satisfaction to express their frustrations with the core of Cartwheel, and the issues haven’t been fixed, means that Cartwheel has failed to provide a seamless shopping experience.

Multichannel Failure
Setting aside the fact that Cartwheel just doesn’t work properly (I debated whether or not to stop the post here), another way to think about a seamless shopping experience is the ability to use a product across web-mobile-tablet-store. Again, Cartwheel fails.

The most obvious problem is that even though I can use Cartwheel to ‘clip’ coupons online (computer-mobile-tablet), if I want to purchase something, I’m forced to go in-store as opposed to clicking over to This can be explained away by saying that Cartwheel is supposed to drive in-store sales, so I’m going to (reluctantly) glance over this problem.

I get the feeling that Target hired consultants and cobbled together a ‘social’ team that came up with a seemingly seamless experience on paper: develop a site which makes use of responsive web design, make it social by working with Facebook, and allow customers to redeem offers digitally or through printed bar codes. Unfortunately, there was little consideration for physical retail and mobile implications.

The lack of physical retail integration has already been covered in terms of 1) lack training for Target staff, and 2) registers that freeze. I can also add that many physical Target stores don’t offer wifi, so pulling up a mobile barcode can be problematic. I experienced this on my first attempt to use Cartwheel. But lets move to mobile implications.

Mobile Hell
When working on a fast paced, Silicon Valley-esque Minimal Viable Product, it makes sense that someone would choose to use responsive web design to meet tight release schedules with limited resources. Unfortunately, though, whoever originally designed the responsive site did a terrible job integrating the required Facebook login for Cartwheel. The first problem is that the original version had a big pop-up prompting the user to log into Facebook. Well, a big popup doesn’t work so well on a mobile device. The second problem, although I can’t confirm, is that I think there was a Facebook authentication issue that further complicated any login attempts. Cartwheel eventually fixed at least the pop up problem, but there was nothing seamless about the Cartwheel experience on mobile for over a month. I can’t imagine how many potential Cartwheel users Target lost..or just pissed off. There are many other mobile site issues, but that was the most glaring.

So if a mobile site doesn’t work, what do you do? You launch an App. In this case, first an Android App then an iPhone App. Bad idea.

There’s already a Target App. Why not integrate Cartwheel with the existing Target App? The Target App already has a ‘Deals & Coupons’ section which contains Daily Deals, Clearance, and Mobile Coupons. Yes, Mobile Coupons, with similar functionality – scan a barcode at checkout – to the Cartwheel App. By introducing new native Apps, you’ve now created friction as users potentially have to use 2 Apps to redeem offers. Add in REDCard (for a 5% savings), and you have to scan/swipe/show three times at checkout. Add in any clipped coupons and that’s 4 times. Again, not so seamless.

But the bigger issue with launching a Cartwheel App is that the Cartwheel team decided to move forward on something new as opposed to fix what was already causing problems. And launching + supporting iOS and Android Apps isn’t an insignificant feat. The only explanation I can think of is that Cartwheel team members had heard about a concept us crazy kids in the Valley call continuous innovation, but they never actually read Eric Ries’ The Lean Startup. If they had, they would have been measuring and learning. The abysmally low Global Savings number was staring them in the face! This should have been a blatant STOP sign. It was time to ask hard questions about the program.

There was an opportunity to stop development of anything new and address the product vision (which I believe led to terrible feature creep), product bugs (all they had to do was read the help forum), inexcusable in-store redemption problems, and responsive web design issues. And even more importantly, the Cartwheel team could have decided to address another underlying problem with the program: requiring Facebook login. Customers had complained about the Facebook login requirement from the start, but launching the native Apps only amplified these complaints.

But Cartwheel didn’t stop. And now the team has all the old problems plus new problems with its Apps.

On Google Play, Cartwheel currently has an average rating of 3.4*. If you look at the 37 (out of 54) 1-star ratings, the main complaints are 1) Facebook login requirement and 2) not being able to login/app crashing, which I attribute back to complaint 1.

As if the Android App wasn’t bad enough, the current iPhone App is even worse. Based on 62 ratings, Cartwheel has an average rating of 1.6**. And sadly, if you look at all versions of the Cartwheel iPhone App, there are a total of 148 (out of 201) 1-star ratings. Finally, newer versions of Apps are supposed to rate better than older versions because you’ve hypothetically made improvements. However, the all versions average rating is 1.79, so the new version of the App is trending in the wrong direction.*** So what’s the main issue when you read the 1-star ratings? Facebook!

So Cartwheel has a problem with the mobile site. Cartwheel has a problem with the Apps. Cartwheel has two problems with Facebook login – making it a requirement and getting it to work. Oh, and the Facebook problems are not just a mobile/App issue.

The Facebook Mistake
Focusing on Facebook for a minute, there was little reason for Target to launch a service which required Facebook login. The current functionality allows users to share deals/badges and invite friends. Although I have no proof, experience tells me that sharing and inviting isn’t happening. I also doubt conversion into new Cartwheel users or more importantly, conversion into a coupon redeemers is happening. If you look at the daily revenue growth of the program (see Excel embed), and to a lesser extent, Cartwheel’s Facebook App page Likes and Usage, and Google Play Installs, Cartwheel doesn’t seem to have a high k-factor. The viral growth is non-existent. Another reason for requiring Facebook login is to send targeted/personalized offers based on the Facebook Graph. As far as I can tell, this isn’t part of the current experience.

Launch is one thing, but now the Cartwheel team has user feedback and data which I think would enable them to conclude there’s no reason to keep the Facebook login requirement.

What about Sales?
Cartwheel has failed to create a seamless shopping experience, but let’s look at the program through another lens. Why not grade Cartwheel on in-store sales? Even if Target isn’t discussing this, we all know that if Cartwheel doesn’t drive in-store sales, it should eventually be shut down.

I estimate that Cartwheel offers have driven approximately $4.7m in the first 8 weeks. Let’s put that number in perspective.

Target did approximately $71.4B in revenue in 2012 across 1778 stores ($73.3B in total revenue minus $1.9B from online, according to Internet Retailer data). This means each store did approximately $40.2M in revenue in 2012 or $6.7m per two week month period. Some people are going to compare the $4.7m in Cartwheel revenue to average single store revenue of $6.7 and claim a success. That’s wrong. The $4.7m isn’t coming from a new channel. The $4.7m is part of in-store revenue. So as opposed to comparing $4.7m to $6.7m, you have to look at the impact $4.7m has on the $6.7m.

Across 1778 stores, the $4.7m breaks down to an additional $2,655 per store. An additional $2,655 on 2012 aproximate revenue per store of $6.7m is 3 basis points of growth ($2,654.67/$6.7m = .00039%). And that’s assuming that all sales though Cartwheel are accretive. As Cartwheel was being marketed to REDCard customers and was (briefly) featured on the homepage of, I think Target would have captured most of those sales anyways, especially as the top sales are for staples like milk, paper towels, berries, etc. In an ideal world, Cartwheel might have increased AOV and conversion rate a bit, but with the friction of actually using Cartwheel, I doubt this happened.

In other words, I don’t think that 3 basis point growth is real. Cartwheel is not driving in-store sales.

It’s time to shut down Cartwheel. Not only is Cartwheel broken and a non-seamless shopping experience, but the program is distracting the company from more important projects such as improving online sales growth.****

As I’m sure many people at Target will disagree with my analysis and continue to expand the program, I want to finish by framing Cartwheel not just as a failure, but also a critical learning experience. Everything I’ve written can be turned into a suggestion for improving Cartwheel or a framework for future initiatives:

Think in terms of a seamless customer experience. Facebook login should be an option, not a requirement. It would be more convenient to have a single interface to find, organize, and redeem coupons. Before launching a new program that is used within a store, it’s imperative to 1) do more QA in a diverse store set (wifi enabled, non-wifi enabled, heavy physical coupon usage, heavy REDcard usage, City Target vs. regular store, etc.) and 2) conduct more thorough training of in-store staff. It might be useful to test staged roll-outs of Beta initiatives. Everyone working on or talking about a new public initiative should be provided with talking points. I applaud the effort to roll out early and often and work like a start-up, but you don’t have to re-invent a very established wheel. Instead, consider infusing new initiatives with entrepreneurs, develop intrapreneurs through sending exceptional team members to the Lean Start Up Conference or related meetups, or just run projects out of your new Technology Innovation Center, which I’d assume will already be well versed in these concepts.

*There are 54 5-star ratings, 11 4-star ratings, 5 3-star ratings, 4 2-star ratings, and a whopping 37 1-star ratings. The true average rating should be 3.3 or lower as at least 3 of the 5-star ratings are from Target employees or associated companies.

**There are 7 5-star ratings, 1 4-star rating, 2 3-star ratings, 3 2-star ratings, and an impressive 49 1-star ratings.

***And I didn’t even investigate if there are Target employees or associated companies writing the 5-star ratings…which would bring the true average rating down even more.

****At just 9.65% y/y sales growth (according to data from Internet Retailer), Target’s online sales growth is well behind that of Amazon (27.06%) and Walmart (20.31%). Furthermore, growth is below average for the top 20 Internet Retailers (12.93%) and well below average for the top 100 Internet Retailers (40.2%).


  1. Bravo to your manifesto, Brian.
    Likely a different executive launched this than anything else, disconnected from the real organization.

    • Thanks, Rick. By no means a manifesto, but creating a seamless shopping experience will make or break retailers. Maybe not today, maybe not next week, but over the next couple years the web-mobile-tablet-store browsing-buying-pickup/delivery experience has to dramatically improve. Consumers will not stand for friction while shopping. Any disjointed experience will send the every-connected consumer to the next store, along with all her friends.

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