Target 's Business Level Strategy

Target Corporation (NYSE:TGT) is the leading large-format general merchandise and discount retailer in the U.S., challenging Wal-Mart in electronics, toys and apparel while also seeking to differentiate with higher-end fashions and products for an upscale audience. As of the close of their latest fiscal year (FY2011), Target operated approximately 1,760 stores encompassing 233,000 square feet in 49 states and the District of Columbia. The company is divided into the retail and credit card divisions and moves the majority of its products through a highly integrated network of 37 different distribution centers, which include four food distribution centers. Target is one of the most well-entrenched large format retailers in the U.S., has the ability to manage their pricing strategies at a level of accuracy and precision that is comparable to Wal-Mart (Henderson, 2001). Unlike Wal-Mart, Target concentrates on a value-based message that concentrates on quality and price differentiation to sustain their gross margins while Wal-Mart concentrates on supply chain efficiency and a continual reduction of supplier and transaction costs (Krishnamurthi, 2001).

The aim of this paper is to highlight the strategic position of the company with an overview of its internal and external environment. The study of its strategy, design and other forces, one can easily gauge why and how target has managed to become the retail giant it is today.

After the recession, Target’s value proposition shifted to simply offer affordable options in a wide array of product areas. However, now with better economic conditions and without the ability to offer lower prices than its affordable retail competitors, such as Walmart, and in order to stay relevant and refresh the company, Target needs to reposition itself as the high-quality concept and style-oriented retail store it was once known for.

Target Corporation uses energy conserving Windows, low wattage bulb fixtures, motion sensors and refrigerator that earns energy stars as well as saves energy cost through these initiatives (Target Sustainability, 2015). Target Corporation energy efficient sustainable building is a commitment to support community and environment using solar energy. Solar energy generation eases the burden of the local power supply company. The more Target Corporation leads with an environmentally sustainable initiative, the Target Corporation brand name becomes popular and more people aware of the brand within the community (CSR, 2014). Target Corporation focus on the growth also based on the customer convenience by building urban stores near mass transit saving an enormous amount of transportation cost and lowering carbon footprint. These urban stores bring more traffic and more sales outperforming the competitors in the same area.

The Target Corporation prides itself on their department store roots with a constant obligation to great prices and stylish originality. The main focus of every Target store is the customer, whom the corporation refers to as a "guest", making them feel more personal. Each guest can expect to

Target Corporation has recognized itself as one of the top retailers in the United States market on the basis of excellent service quality, customer experiences, operational excellence, strong financial position, and a wide array of product offerings. Through its high degree of service orientation at physical outlets and adoption of fair business practices, Target Corporation has become the most distinctive retailer in the eyes of its potential customers. Being one of the top-notch retailers in the United States, Target Corporation has to carefully strategize on its business operations and marketing tactics so as to keep itself in the row of competitive brands of the industry.

One of the issues Target could face if it continues to only focus on private label store brands and do not promote national brands is losing a percentage of its customers. Although Target’s innovative amount of store brands on its aisles has proven successfully for the retailer and consumers have shown a positive reception to the products, there are still a number of customers who are accustomed to

CEOs are required to have the most experience and knowledge regarding their field of business. They maintain company loyalty and product reputation. Brian Cornell is board chairman and CEO of Target. He manages Target’s global business, including nearly 1,800 U.S. stores and Target.com, more than 341,000 team members and millions of guests. Cornell leads the retailer’s executive leadership team in accelerating Target’s performance, advancing its digital evolution and delivering on its “Expect More. Pay Less.” promise to guests. Cornell joined Target in August 2014 after more than 30 years in escalating leadership positions at leading retail and global consumer product companies, including three CEO roles and more than two decades doing business

As the second largest retailer in the U.S., Target provides customers with high quality and low priced products. Since its inception, Target has been able to reach U.S. consumers successfully, with stores in every state except Vermont. Ninety-seven percent of Americans are aware of the Bulls eye logo. In addition, Target’s revenue increases every year with the 2016 revenue totaling $67.390 billion.1 The successfulness of Target can be appointed to three strengths: product value, appearance of stores

Target has done well over the years due to its successful integrated marketing communications. Today, Target is the second-largest discount retailer in the United States, with $65.4 billion in sales and rank number 28 on the fortune 500 list. The main focus to build an up-market cachet of its brand without losing its relevance for price conscious consumers, Target positioned itself as a high-fashion brand retailers. Target aims to fulfil its brand promise of delivering trendy styles and quality merchandise at affordable low price by sending Merchandisers to travel over the world to look for next hot items. Target adopted Europe popular concept of ‘fast fashion’, which keep the product selection fresh result in more frequent shopper visits. To further enhance the shopper experience, Target uses a variety of tactics to communicate its ‘ cheap chic’ positioning, beginning with its slogan, ‘Expect more, Pay less’. Target also pays attention to how they place the shelves, lighting, fixtures and even creating wider aisles to avoid visual clutter.

The goods and services in the competitive environment is what triggered Wal-Mart to analyze their current marketing targets and strategy. Target was their biggest competitor and the economy dropped was perfect timing for Wal-Mart to revise their goods and services for the middle class consumers. Wal-Mart identified that they were selling skinny jeans to their customers who the vast majority averaged a size fourteen. This was not smart marketing from a consumer based standpoint. Wal-Mart revised their target mix and then identified what needed to be revised in their marketing mix that would be beneficial to the organization.

Using its clout, as the second largest discount chain, Target wrote an imperative appeal to their wholesalers regarding the need for new product creation, that would set it apart from rivals in an effort to protect the chain from this price comparison movement, and where these unique goods aren’t possible, Target is urging the vendors to assist them in being able to match their competitor’s prices (Kinicki & Williams, 2012). The long-established collaborative nature of the relationship between Target and their vendors,

Target demographic are all shoppers. Before the recession Target main customer focus was the “ minivan mom” or boomer mom in suburban areas (Haizack 2015). This type of consumer being a stay at home mom that takes care of home. This type of shopper was said to want stylish chic design and this plan worked well until hard time hit the company due to the recession. During this period target changed their brand to low prices but this strategy did not work for the company (Haizack 2015). Target fell into the trap of selling cheap products instead of the stylish ones that the customers were accustomed. Target Wants to be the number one department store in the world and to do this they have to appeal to all and future shoppers. The major group that Target is looking to market to is Hispanic guest. A poll was given and 54% of Hispanic millennial said Target was their favorite store to buy items from (Haizack 2015). This poll shows that Target plans to expand to this market and tap into the potential

Ashley Murrell Tara Estes English 101 December 2, 2016 The Battle of Walmart, Kmart and Target In today’s shopping world, there are so many places people can go. There are stores that have everything you need in one place. Target stores are the newest to come up, competing with Walmart and Kmart, which have been around for decades. All of these stores have the same idea, but are, also, very much different. From the neighborhoods they are placed in, to their catch phrases, and prices. They all have services that are similar, and customer shopping experience. Each offers almost the same departments, but different layouts, sizes of the area, and brand names. Target the newest star to join the market; it has shown up in urban neighborhoods with spot light prices. Using the catch phrase of “Expect More, Pay Less,” they drew in a younger crowd. Target customers pay a little more than what those that shop at Walmart pay, but save more than Kmart customers. Walmart that came in after Kmart is known for their smiley roll back prices, and are the home of the “Save Money, Live Better,” catch phrase. They are found in most metropolitan cities, and along travel routes; thus making them easily accusable to travelers. Walmart comes in as the cheapest of these three marketplaces. Kmart and their “Blue Light Specials” are getting harder to find due to their closings nationwide. They once targeted the same areas as Walmart, and now they are few and far between. Kmart is also dead last when he

The most important actor in a company’s microenvironment is its customers and they have definitely affected the performance of Target’s performance over the past few years (Kotler and Armstrong, p.69). Target did not resonate with its customers like Wal-Mart did, according to Kotler and Armstrong; their well-cultivated “upscale discount” image was turning away customers who believed that its fashionable products and trendy advertisement meant steeper prices. Because of this, the company had experienced three straight quarters of flat-same store sales growth and a small reduction in the amount of shoppers they were receiving.