TARGET LAUNCHES NEW PAID MEMBERSHIP PROGRAM IN A BID TO DRIVE SALES AT A TIME OF CAUTIOUS SPENDING

Target, looking for ways to reverse a sales malaise, is getting into Amazon territory: the paid membership game.

The Minneapolis discounter said this week the new paid program, called Target Circle 360, will offer unlimited free same-day delivery in as little as an hour for orders over $35 and free two-day shipping. It will launch with a special offer for new members for $49 per year from April 7 through May 18. After that, it will cost $99 per year. But Target Circle credit card holders can sign up for the lower price anytime.

The discounter said its current Target Circle program has more than 100 million members who shop and spend more than five times more than non-members.

The launch of a new paid membership program was one of several key moves announced at Target's annual investors' meeting that aim to rejuvenate sales and traffic. The discounter also said it will refresh its stores and expand its highly successful store-owned brands, which combined generate $30 billion in sales. And over the next decade, the chain will build more than 300 new stores.

The investor meeting comes as the latest financial results show Target's shoppers remain cautious about spending on discretionary items as they are squeezed by inflation and high borrowing and credit card costs. The company reported its first annual decline in sales - 1.7% in seven years.

Target delivered a 58% increase in fourth-quarter profits and handily beat Wall Street expectations as the retailer cut costs and maintained a lean inventory during the critical holiday season.

Revenue rose slightly in the latest quarter from a year ago and also topped projections. But comparable sales — those from stores or digital channels operating at least 12 months — slipped 4.4%. The declines, however, slowed compared with the 4.9% drop in the third quarter and 5.4% drop in the second.