Yahoo Finance’s Julie Hyman, Myles Udland, and Brian Sozzi speak with Shipt CEO Kelly Caruso as online shopping booms amid COVID-19 and ahead of the holidays.
BRIAN SOZZI: Same day delivery services are having a big moment this holiday season, as people avoid stores during the pandemic and Target Shipt services right in the middle of the same day delivery action. Kelly Caruso is the CEO of Shipt, and she joins us now. Kelly, good to speak with you here. I've been using Shipt for quite some time. I get it, it has proven very helpful to me. But I was in the Target stores this weekend, and I've seen a lot of the Shipt personal shoppers really pack stores.
What have you seen at the start of the holiday season? There has been concern about how it has started, but I've seen a lot of those shoppers in Target stores. How would you grade the start?
KELLY CARUSO: Yeah. Hey Brian, good morning. It's great to be here. Undeniably, we're off to a very strong start. We have set records in the weeks and days leading up to the holiday start. In fact, on Thanksgiving Day alone, with so many retailers that were closed for that day, we saw a 65% increase, year over year. And that momentum continued, not only through Black Friday, but well into the weekend as consumers continued to place orders around both groceries and giftable items. And so as we head into Cyber Monday today, we feel well-poised and positioned with our shopper community of almost 300,000 strong to really partner with our customers and our retail partners in delivering Cyber Monday orders today for same day delivery.
BRIAN SOZZI: Kelly, it sounds as if you're ready to blow past your, I believe what, the fourth quarter goal, double the amount of new shoppers you might add to the platform?
KELLY CARUSO: Yeah. When we came into the year, we started with 100,000 shoppers. We quickly scaled to 200,000 when we saw the initial demand from the pandemic. And for the holiday season, we'd like to grow from 200,000 to 350,000 shoppers, and we're well on our way to that.
JULIE HYMAN: Kelly, it's Julie here. Thanks for joining us. Talk to me how this works, sort of logistically. In other words, if you have all those new people you're hiring, who are, in many cases shopping in the store, how do you work in terms of workflow because of pandemic capacity restrictions? And also, I have to admit from a shopping experience, I have been in stores when there are people from your competitors, for example, who are doing shopping for delivery. And at times it can be off-putting when, as a regular shopper, you're sort of competing for space with people who are in the store shopping for delivery.
KELLY CARUSO: Yeah, yeah. So I would say a couple of things, Julie. Number one, we have bet on the power of the personal shopper since day one. We believe at Shipt that technology without that human element is not relevant for the future. And so our shoppers do a couple of things really well. They know how to pick a product and get the order exactly right, whether that is groceries to giftable items like toys and electronics. They are great communicators. And that applies to not only the customer, but to the retail employees and the stores that they are shopping.
They develop amazing relationships with their counterparts in retail stores. And lastly, their attention to detail and their ability to go above and beyond creates a great experience, not only for our Shipt customers, but for our retail partners. And Shipt is truly seen as a brand extension or a brand ambassador, if you will. We absolutely want to be a retail partner. We do not want to be a retailer. And so by working closely with our retailers, we're able to understand what protocols they have into place on a location by location basis, to make sure that we are enhancing that shopping experience, not detracting from it.
And the last thing I would say is early on in the pandemic, it was really important that we create this safe shopping environment for both our shoppers, and our customers. And to do that, not only did we scale up our shoppers, but we also offered them and continue to, protective equipment on a daily basis. We offer financial assistance if they are diagnosed with COVID. And we created more product features such as contactless delivery, to really have the highest level of safety possible. And what we've seen is our consumers and our customers, they feel like they've got a partner as they head into the holidays. Celebrating the holidays are important. Doing it safely is equally important, and Shipt is a great holiday helper for them.
MYLES UDLAND: Hey Kelly, it's Myles here. You were talking a little bit earlier with Brian about some of the membership trends that you've seen. And I'd be curious if what we've seen during the pandemic has had you guys rethinking your TAM here, if it's actually a bigger market available to a company like a Shipt, because there's forced behaviors have happened and people realize they've actually liked this. Is that something that you have thought about at all?
KELLY CARUSO: Absolutely, Myles. We believe that online shopping and the subsequent fulfillment systems that go along with that, they're here to stay. And so as I look forward to 2021, myself and the entire Shipt team, we are really focused on four key areas. Number one, we'll continue to grow our footprint and coverage area in the US. Secondly, we want to continue to expand the retail offering that we've got on our marketplace to ensure that there is absolutely the right mix of grocery, household essentials, general merchandiser, and retail verticals.
Next, we're going to focus on our product offerings, whether that is growing our marketplace, continuing to grow our delivery only services, expanding our platform product offering, and continuing to offer white label options. We want to partner with our retail partners to create the fulfillment service that is right for their business.
And lastly, but probably most importantly, as we'll continue to create inclusive environments, both for our team, our shopper community, and our retailers at large. Our purpose is to spark the connections that show how every person counts, and we'll continue to do that in 2021.
BRIAN SOZZI: Kelly, and that's a key point to it. Shipt is not just a Target thing. You still work with many other big name retailers. And to that end, really, same day delivery is only going to get faster. And it's going to be a real critical component to brick and mortar retail. As you look to next year, how are you going to get more humans to come and work for Shipt, and how many people do you think you're going to have to hire just to meet the new normal demand we're seeing out of retail?
KELLY CARUSO: Yeah, yeah. So Brian, I would say a couple of things. Number one, as you know, it is expensive to build out e-commerce and fulfillment capabilities. And Shipt is a great partner for retailers to partner with, instead of building on their own. We want to enhance their in-store experience, not replace that. So we are a great, trusted partner to that end. As we think about scaling our business to meet demand in 2021, we will continue to place bets on the personal shopper.
And we believe that Shipt is a great opportunity for our shoppers to have an opportunity to work flexible hours and earn great income. And we know that today, we pay about $22 per shop, including tip. And so listening to our shoppers, continuing to create these flexible income opportunities, creating product enhancements, really making Shipt the premier platform for all of our shoppers' needs is what we will focus on to ensure that we're able to not only recruit, but retain the shoppers on our platform.
BRIAN SOZZI: All right, we'll leave it there. Kelly Caruso, the CEO of Shipt, good to see you. And good luck this holiday season.
KELLY CARUSO: Thank you, Brian.