Target Corporation is the second largest retailer in the U.S. with over 1700 Target and Super Target stores. Targets around the country offer everything from household essentials to computer software to groceries, and sell many of their products under private label brands. In addition to their retail segment, the company also offers credit and debit cards to its frequent shoppers.
In our report, we analyze company's past and present performance through a thorough study of Target's brand, their accounting disclosures and overall financial performance. Based on our findings, we suggest that the company:
Continues to expand its private label offerings
Considers relocating the grocery section to the rear of the P Fresh stores
Explores expanding its operations to Canada
Brief description of the company
In 2002 the Minneapolis-based Target Corporation became the United States second largest discount retailer behind Wal-Mart. According to “Simply Better” from the Harvard Business School Press, Targets success can be attributed to two key factors: the right kind of differentiation and distinctive marketing communications. Target positioned itself as a mass merchant selling affordable yet stylish goods. Today Target has transformed its signature bulls-eye logo into a lifestyle symbol. The bulls-eye is recognized by 96% of American consumers and considered a brand icon in a class with Nike's swooshing and McDonald's arches. This was accomplished through a strong commitment to advertising to build an iconic brand. Target has reportedly spent 2% of its revenue in advertising compared to 0.4% spent by Wal-Mart or 5% spent by Macy's in 2009.
Additionally, Target shows its commitment to building a chic brand by offering exclusive lines in partnership with well-recognized designers. Target is no stranger to providing top 4 designer labels without the ready-to-wear prices. Past and current partnerships include, Isaac Mizrahi, Jean-Paul Gaultier, Anna Sui, Todd Oldham, Zac Posen and the late Alexander McQueen. These partnerships have proven profitable as customers flock to secure items from these designers at prices they can comfortably afford. Most recently, Target has aligned with the Gilt Grouped, an online retailer that commercializes premium brands at discounted prices, to offer select lines for limited periods of time.
About Organization
In an effort to change consumer perceptions about its prices and to turn around its poor performance during the recession, Target shifted its message towards the “pay less” portion of its well-known “Expect More, Pay Less” brand promise. Part of this strategy included focusing on more basic, recession-proof items such as groceries. About 60% of Target's sales came from discretionary items such as clothing and home décor, which were items that were cut from shopping lists during the recession. A key example of Target`s new effort is “The Great Save” event which was held in early ...