Jul 10, 2015

Inside Target’s Tech Funhouse and Search for Its Next Billion-Dollar Business

San Francisco is home to technology. Now it’s home to perhaps the most technologically-advanced house, too. Inside a new store on Fourth Street stands a mockup of a Victorian-style house, complete with gingerbread trim and a three-panel bay window — but made entirely out of acrylic. There’s a nursery, in which visitors can trigger a morning routine that’s homey and alien all at once. A projected silhouette of a baby in an acrylic crib awakes. A onesie outfitted with sensors, from the startup Mimo, detects the movement and alerts a mother’s phone in the adjacent room. A shimmering white stream of data visualizes the connection. Another stream starts the coffee maker in the kitchen, with sound piped in to confirm the brew. A Sonos speaker releases a musical mix, the Hue lightbulb brightens and the humidifier connected to a WeMo Internet-connected switch turns off. A silhouette of a father enters the room and lifts the baby from the crib. The infant coos. A baby room equipped with smart devices at Target’s open house Rachel Bracker for Re/code A baby room equipped with smart devices at Target’s Open House This scene and others come to life inside a new tech wonderland created by Target, designed to show off the 35 Internet-connected home devices studded throughout. There’s an August smart door lock, a Ring smart doorbell, a Nest thermostat and a Sonos music player. This is the house of the future, but its existence shows that it’s also possible in the present. The acrylic abode, dubbed Open House, opens on Friday on the street level below the Metreon City Target store, and it’s the first major manifestation of a big entrepreneurial bet by Target CEO Brian Cornell to re-energize the retailer’s brand and create a new billion-dollar business outside of its comfort zone. Target could use a home run. Revenue grew just 1.9 percent to $72.6 billion in 2014 as the company continued to dig out from the massive payment information hack of the 2013 holidays. “We’ve been reliant on products and services and market expansion as our means of growth,” Casey Carl, Target’s chief strategy and innovation officer, told Re/code last month inside Target’s Minneapolis headquarters. “Although those are great, we also have to be playing on other fronts to diversify our portfolio and make it far more defensible as a business model. Otherwise you can just get picked off from any and all competition over time.”

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