Target Stores

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Target Stores Target Stores Expect More. Pay Less.

Introduction • One of the most recognized corporate symbols in the United States is that of the Target corporation, who have 1,351 stores in 47 of the 50 states. • The first Target store opened in Roseville, Minnesota, in 1962. Its trendy merchandise at affordable prices launched a new era in discount retailing. This “T-1” store was easy to shop, attractive and always clean. It served as the prototype for every Target store opened since then, and it changed how consumers think about discount shopping.

• The first Target Store was opened by the Dayton Company in 1962, in Roseville, a suburb of the twin cities Minneapolis-St. Paul, Minnesota. Target is a chain of Discount Department Store that are about 95,000 to 135,000 square feet (12,000 m²) and carry hardlines ("regular" products and goods), softlines (clothing), and a limited amount of groceries, mostly non-perishable.

Introduction • 1960 – 1969

Target stores are introduced, capturing customers’ loyalty by offering popular national brands at discounted prices. The main aisle allows easy navigation; efficient, clean displays make discount shopping easier and more pleasant than ever before.

1970 – 1979 • Already taking the lead in retail thinking, the newly established Target stores are organized according to consistent blueprints called “plan-ograms,” ensuring that each of the 300 locations are clean, easy-to-shop and intuitively arranged. • The stores contain photo processing, pharmacies and Food Avenue® restaurants, so guests can accomplish more in one shopping trip while enjoying the well-lit, appealing atmosphere and the friendly assistance of red-shirted team members. Electronic cash registers are used for the first time, and the Sunday circular begins to hit a few key markets.

1980-1989 • Inside the stores, Target adds electronic scanning checkout, simplifying distribution, speeding guests’ exits and guaranteeing accurate pricing. At home, the weekly Target advertising circular becomes second only to the Sunday comics as America’s most-read newspaper insert, delivering customers information on the newest and best-priced items waiting in stores. Target also offers a holiday exclusive that becomes the must-have gift of the season.

1990 - 1999

Target stores expand in new directions with the introduction of the larger-sized Target Greatland® concept stores and the Target Guest Card® (now the REDcardSM). In 1995, SuperTarget®, which adds groceries to the product mix, gives consumers more reasons to make Target a regular destination.. At the end of the decade, GiftCards are introduced, while Target expands to the Internet with Target.com as its online presence.

The exterior of a typical Target Greatland in New Jersey. Unlike smaller Target stores, It feature double entrances.

2000 - PRESENT In 2001, downtown Minneapolis, home to Target Headquarters, finally gets a Target store of its own: A two-story location on Nicollet Mall. Manhattan gets a special holiday treat as Target docks a floating holiday gift shop at Chelsea Piers in 2002. Target.com establishes itself as one of the mostvisited retail websites in the world. In July 2005, Target turns New York’s Rockefeller Center into a vertical catwalk for a fashion show featuring collections from designers Mossimo, Liz Lange and Isaac Mizrahi..

The exterior of new Target store in Miami, Fl

Mission: To make Target the preferred shopping destination for our guests by delivering outstanding value, continuous innovation and an exceptional guest experience, and consistently fulfilling our Expect More Pay Less.® Brand promise.

Target Stores at Minnesota.

Success & Reach • Today, Target operates more than 1,600 stores in 47 states, including more than 200 SuperTarget® stores that include an upscale grocery shopping experience. In addition to the photo processing centers, pharmacies and Food Avenue® restaurants found in almost every Target, SuperTarget stores include in-store bakery, deli, meat and produce sections.

Target Shoe Store

Positioning • Target Corporation (Target) had 1,330 retail stores in 47 states of the United States. • Target's positioning was based on more than just pricing; it encompassed quality, style, and trend. This was the differentiation strategy that was consistently applied since the launch of the chain.

• Target positioned itself as an upscale discount chain. It differentiated itself from its competitors by offering trendy merchandise at affordable prices. • Target used attractive marketing promotions to communicate this message to customers. By 2002, the company became the second largest discount retailer in US. • The differentiation followed by the company and its effective communication programs helped it to continuously increase its revenue and net income.

Target Stores Headquarters

Target Strategy To be able to offer the most up to date styles and trends to the customers Target focused on merchandising. Recognizing that just having the goods in the stores was not enough, Target also worked on conveying this image to the customer through its store layouts and displays, and through marketing and promotions.

Merchandising Target's positioning as an upscale discount chain was reflected in its merchandising strategy as well. Target managers felt that they needed to be constantly in tune with what the customers wanted and anticipate trends and demands. Warren Feldberg, Target's Executive vice president of merchandising, tried “looking at the world as our shopping basket and finding ways to bring that basket to the average customer”.

Differentiation Strategies • From the very beginning, Dayton's strategy was to position Target as an upscale discount chain at which the prices would be just above the lowest prices. To achieve this upscale image, it offered trendy and stylish goods in an environment that was bright and attractive, unlike other discount stores of the time.

Differentiation • Target Corporation competes directly against other discount retailers, mainly Wal-Mart and Kmart. • Since its founding in 1962, it has intended to differentiate its stores from its competitors by offering what it believes is more upscale, trendforward merchandise at low cost, as opposed to the traditional concept of focusing on low-priced goods.

Revolutionizing Retail • From department store roots to the awardwinning online presence, Target works to deliver a great retail experience. They strive to exceed their guests’ expectations, adding this and trying that to provide the perfect blend of style, substance and oh-so-satisfying shopping.

Design for All Our Commitment to Design Great design is the essence of the Target brand. Target partners with world-class designers to offer amazing products at affordable prices. Since day one, our company founders recognized that the appeal of smart, stylish, well-designed products and stores would set Target apart.

Issues Involved • » How a new entrant can differentiate itself from

existing players in the discount retailing industry. » The role of branding in successful positioning in the discount retailing industry. » How pricing is not the only way to compete successfully in the discount retailing industry. » How a company can continue to differentiate itself as it grows and maintain its unique image in the eyes of the customers. » The role of merchandizing in the success of a retail store.

Questions for Discussions • “Target positioned itself as an upscale discount Chain. Target Differentiated itself from its competitors by offering trendy Merchandise at affordable prices” Explain in detail how differentiation strategy helped Target to become one of the leading retailers in the US.

Differentiation Strategy To be able to offer the most up to date Styles & trends to the customers Target focused on merchandising. Target realized the importance of not just having the goods in Store but they also worked on conveying the image to the customer through its store layouts & displays & through Marketing & Communications. Their Tag Line Expect More Pay less in all their Branding Strategies created a strong effect in consumers mind & helped in Differentiating from competitors.

Differential Approach Most Retailers use Shop within a shop concept but Target used a different Approach. They decided to bring in more Brands & labels and created focus areas for them. What Target does is purchase long, deep & narrow. Target established a QUICK RESPONSE TASK FORCE & identified trends and purchasing patterns so that they can quickly develop &implement Micro Marketing Programs which shows that Target is a customer-centric organization.

Target Managers were always attune with what customers wanted & anticipate trends & demand. They looked at the world as our Shopping Basket & finding ways to bring that Basket to the average customers.

Question for Discussion “Target began forging partnerships with recognized designers & design houses to bring affordable designers goods to its customers”. Assess the symbolic relationship that existed between Target & its design partners?

Symbiotic Relationship It was a part of reinforcing its upscale image & provide quality & affordable designer goods so as to attract more customers base to its Store. The forged partnerships based on symbiotic relationships as it will benefit Target as well as Designers. Target is getting designer clothes in their Store at affordable prices & in turn Designers got a new platform to showcase their products.

Forged Partnerships Target collaborated with : Michael Graves : Home Goods Collection •

Massimo : Men’s & Women Sportswear He got Royalties with substantial guaranteed minimum payments for licensing his trademark to Target.



Designer Mizrahi: Women apparel, footwear etc. His lines for Target was considered fashionable yet affordable helped in increasing footfall. It helped Mizrahi as well in launching his new line of couture clothing.



Rosen Zweig : encompassed variety of products which helped in increasing the Merchandise & pulling customers to store.



Ming Tsai: Exclusive Kitchenware & cooking ingredients

Alliances By collaborating with these designers Target pulled a lot of customer traffic and gave its customers a lot of variety to choose from with large Merchandise. Collaborating with Target gave an opportunity to designers to promote & sell their products in a reputed store & paved way for future growth & success.

Question for Discussion One of the key elements in the success of Target has been its ability to effectively communicate the Company’s unique Positioning by coming out with attractive Marketing Promotions. Analyze how the Company conveyed the uniqueness to its Customers?

Successful Branding

TARGET logo was recognized by 96% of Americans which is tremendous success in itself.

Target itself had become a Brand because of its successful Merchandising Strategies, Marketing & Advertising.

Making our mark with our logo. The Bulls eye logo, in the shape of an archer's target, symbolizes great vision, perfect execution and intuition. Our team members make the perfect draw on the bow, adjust our aim, and hit the target of our business goals.

Communicating through Branding • "Branding is one of the things they (Target) do a good job of, and it represents where they want to be in the market“ By Chris Merritt, principal at Kurt Salmon Associates, commenting on the branding strategies of Target.

Image Management • Target developed an image and displayed products that matched its customers lifestyles and created enhanced merchandise displays. It offered a mix of private labels and national brands in creative and innovative layouts and displays.

Interiors of Target Store •

Advertising & Marketing Communications With its advertising & inshore presentations target consistently conveyed the message that its collections are clean, fresh & in Style. It also stressed that goods are priced right & convenient to buy. These messages were conveyed through Circulars, TV Ads, Points Of Sale, Signage & Merchandise Displays. They added more value by time spent by the customer in buying. Effective communication helped in increasing average customers per visit.

Positioning through Advertising

From publishing a unique & differentiated Ad Circular every Sunday which was able to project an image of Style & sophistication to the customers to artful displays aisles & creating stylish trendy Image for everyday items Target positioned itself as being stylish, affordable & trendy & won many Awards for its advertising & Marketing Communications.

Advertising & Branding

Sales Promotions The Promotions initiatives with AOl,Amazon.com & Collegestudent.com & offering customer friendly online shopping with personalized & unique shopping experience was a major hit among Target Customers. The idea of providing Target Smart Visa cards to its customers, Running the Stores in a Boat & opening Special Summers Stores (Bulls eye Inn) surprised & delighted the customers & helped in strengthening the Brand & deepen relationship with Customers.

The Major Contributors to target Success are : 3. Target recognized that value was a function of quality, trend & price ¬ just Price. 4. Target recognized the importance of an attractive shopping environment & not just offering goods at lowest price 5. Effective Communication& Marketing Strategies. 6. Creative Advertising Campaigns & Promotions. 7. “Design for All ” Concept in Merchandising. 8. Branding Efforts to convey positioning & Image. 9. Customer Centric Philosophy : Constantly in tune with what the customers wanted and anticipate trends and demands & Offering trendy & stylish products. 10.Updated Retailing Technology

Questions & Discussions Thank you…..

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