MMR: Mass Market Retailers, January 11, 2021

MMR RETAILERS OF THE YEAR 2019 Dollar General 2019 Marketer Rick Gomez Chief Marketing Officer Target 2019 Regional Grocer Wakefern 2019 Omnichannel Walmart 2018 Target 2018 Operator Jeff Owen Exec VP Store Operations Dollar General 2018 Lifetime Achievement Award Bob Miller Albertsons Cos 2017 Doug McMillon CEO Walmart 2017 Merchant Shane Sampson Executive VP Chief Marketing and Merchandising Officer Albertsons Cos 2017 Innovator Hy Vee 2016 Dick Boer President CEO Frans Muller Deputy CEO Chief Integration Officer Ahold Delhaize 2016 Health and Wellness Merchant Mark Panzer Senior VP Pharmacy Health and Wellness Albertsons Cos 2016 Beauty Innovator Walgreens 2016 Front End Merchant Larry Gatta Senior VP and General Merchandising Manager for Consumables Dollar General 2015 Brian Cornell Chairman CEO Target 2015 Merchant Charles Redfield Exec VP Food Walmart U S 2015 Marketer Jeff Jones CMO Target 2015 Lifetime Achievement Award Rick Dreiling Chairman CEO Dollar General 2015 International Retailer Loblaw 2014 Rick Dreiling Chairman CEO Dollar General 2014 Marketer Michelle Gloeckler Exec VP Consumables and Health and Wellness Walmart U S 2014 Merchant Chris Skyers VP Health and Beauty Care Wakefern Food 2014 Global Retail Innovation Award Stefano Pessina Acting CEO Walgreens Boots Alliance To page 24 Target Exceeded Expectations During Pandemic to take the reins as chairman and chief executive officer succeeding Gregg Steinhafel At that time Target was struggling with the aftermath of a major customer data breach and a failed entry into the Canadian market More seriously the retailers core business in the United States was losing momentum and relevance Targets board of directors clearly saw the need for a fresh vision Cornell was the first CEO to be appointed from outside the organization What he brought was not only a new pair of eyes but also a sense of urgency and intensity that had been lacking Five months later after an exhaustive review of the Canadian operation with his leadership team Cornell made what he has said was probably the most difficult decision of his career to pull out of Canada Also during those early months Cornell defined the enterprise priorities that would guide its turnaround They included such key objectives as achieving leadership in omnichannel further developing the chains smaller formats that could be deployed in urban environments or on college campuses and simplifying the companys organization and processes to eliminate complexity increase agility and control costs More change was not long in coming The leadership team received an infusion of new blood through several hires that helped reenergize the organization In addition Target had moved hesitantly into e commerce up to that point and management made a critical decision to invest in a thoroughgoing overhaul of the companys information technology platforms that would enable its digital ambitions Despite rapid progress Targets results for 2016 were disappointing Rather than hunker down and follow the prevailing industry trend of closing stores and laying off employees though Targets leadership responded in early 2017 with an audacious plan to ramp up its investments in reimagining and remodeling stores to serve as e commerce fulfillment hubs in technology to drive its omnichannel capabilities and in compensation and training for its team members As Cornell reminded analysts last March there was no playbook to follow in building out and executing this strategy so Target essentially wrote its own Wall Street initially was not convinced but by 2018 the company could point to financial results that far exceeded forecasts After another banner year in 2019 everyone in Target could look back with pride and satisfaction at what had been accomplished But the real test and one that could not have been foreseen came last spring when the COVID 19 pandemic broke out transforming shopping patterns as demand for certain product categories skyrocketed comp store traffic slipped 15 and ecommerce volume exploded Targets recent financial results for the third quarter of fiscal 2020 resoundingly validated the new strategic direction the company announced in 2017 Comparable sales soared 207 while comparable store sales rose 99 and digital comparable sales skyrocketed 155 Throughout Cornell brought not only a new pair of eyes but also a sense of urgency the quarter Target continued to gain market share across its five core categories And Target has gained more than 6 billion in market share year to date and has made more than 10 billion in incremental sales through the first three quarters of 2020 For several years now my challenge to our organization has been how do we make Target the easiest place to shop in America Cornell said recently in an exclusive interview In that time weve created the most complete suite of same day fulfillment services in retail offering our guests unmatched convenience This was part of our broader goal of building a durable business model that would perform well in any business environment That work has certainly served us well in 2020 as weve all navigated the business and economic uncertainties of the pandemic We were able to do that in large part because of the strategic focus we place on our stores and the investments we make in our team As Cornell indicated two of the most critical pieces of the Target response were the decision to use its stores as fulfillment centers for its e commerce business a path that required changes to the layout and configuration of the stores and changes in store processes and the decision to invest in the store team members whose roles would change significantly as Target moved away from its traditional self service discount business model Moreover the performance of the store team members has proven to be an invaluable part of the new Target experience Cornell emphasizes Theyve been a calming presence and a friendly face to our guests who are craving normalcy at a time when very little is normal he said And our teams dedication and flexibility is at the heart of providing a safe and easy holiday shopping experience Its their extraordinary efforts backed by ongoing innovation and investment that are driving our exceptional results Target recognized the contribution of the store teams by investing hundreds of millions of dollars in extra pay and benefits and by fulfilling its 2017 promise to raise the starting wage of U S team members to 15 per hour more than 20 higher than the U S industry average Im incredibly proud of how weve accelerated the investments in our team as theyre taking care of our guests during this pandemic Cornell remarked Investing a billion dollars in increased wages and benefits in premium pay in paid leave for anyone who was over 65 or had a preexisting condition this was right in line with how we care for each other as a team Last spring the Target teams along with those of many other retailers were faced with another unprecedented challenge when the killings of three African Americans including one in Minneapolis ignited a wave of protest demonstrations that resulted in the destruction of many businesses in several different cities Target was significantly affected with some 200 of its 1900 plus stores sustaining damage Our immediate reaction was to rally as a team first making sure that our team members were safe and fully supported as protests spread to communities across the country Cornell observed We also provided space for our team to process the pain of what was happening and to listen learn and lean on each other But the company also immediately tackled the core issue of social justice committing along with the Target Foundation 10 million and ongoing resources to advance racial equity and social justice as well as support rebuilding and recovery efforts in local communities That included repairing rebuilding and reopening stores that were heavily damaged Targets Lake Street store in Minneapolis and its Buckhead South store in Atlanta which were closed after sustaining damage were rebuilt from the ground up in just five months making them two of the fastest rebuilds in Target history Those efforts as well as Targets commitment to use its size scale and resources to help the country heal and to create lasting change were consistent with Targets core culture and its longstanding dedication to diversity and inclusion Weve had ambitious diversity and inclusion D I goals in place for several years now Cornell said And wed made very good progress with those goals recruiting and retaining more diverse team members offering more products from diverse suppliers and directing more philanthropic spending to communities of color Last summer Target took its D I efforts to a new level establishing a Racial Equity Action and Change REACH committee REACH will focus specifically on how we can drive lasting impact for our Black team members and guests Cornell and the REACJ committee stated in a letter to the Target team back in August To determine where From page 3 The retailer has built a business model to thrive in any environment To page 24 NEWS RETAILER OF THE YEAR MMR January 11 2021 23