target corporation
TRANSCRIPT
Target CorporationBy: Antonia Carter-Redding, Nadia Herrera Fernandez, Tom Liuzzo
Agenda
Situation Analysis By: Antonia Carter-Redding
Internal Analysis By: Thomas Liuzzo
Plan of Action & Recommendation By: Nadia Herrera Fernandez
Situation Analysis
Business Case
⊚ Target Corporation is the the second-largest discount retailer in the United States.
⊚ Target offers everyday low prices for designer clothing and other merchandise
Industry and Structure
⊚ Industry: Retail Discount Store
⊚Structure: Oligopoly is defined as a state of limited competition, which the market is shared by small number of sellers
Target’s SWOT
Wal-Mart’s SWOT
Costco's SWOT
Demographic
⊚The Target customer has a median age of 40
⊚Median household income of $64,000
⊚43 percent have children in their home
⊚57 percent have completed college
Internal Analysis
Mission
Mission Statement:
“ We fulfill and fuel the potential of our guests. That means making Target your preferred shopping destination in all channels by delivering outstanding value, continuous innovation and exceptional experiences consistently fulfilling our Expect More, Pay Less. brand promise.”
Target Service Offers
⊚Target RedCard, gives 5% off purchases,
free shipping online, 30 extra days to return
⊚Price Match Guarantee
⊚Mobile App
⊚Everyday priced designer clothing
Financial Performance
1st and 2nd Issue
⊚ Target shopping experience is not as fun as it is in its promotional efforts.
⊚ Though target has the youngest consumers amongst their competitors, it has yet to attract millennials.
3rd Issue: Canadian Failed Expansion
⊚ In March of 2013, Target expanded into Canada
1st Mistake: Bought store leases of Canadian discount store Zellers
2nd Mistake: Open 133 in a short period of time, caused inventory havoc, early stock outs, and bare shelves
3rd Mistake: Aggressive pricing by Wal-Mart
⊚ In April 2015, all of Target’s stores were closed in Canada
“Anything you could have gotten wrong in the playbook, they got wrong," said Antony Karabus, CEO of retail consultant firm HRC Advisory.
Financial Loss
⊚Profit would not begin until 2021
⊚Suffered a 5.4 billion pre-tax loss
⊚Closed all 133 stores
⊚17,600 employees lost their job
Plan of Action
Plan of Action # 1
⊚Addressing Issue #1
⊚Target should engage more with customers by establishing an incubator based in ecommerce, social media, and creating a valuable customer experience
Advantages
⊚ Easily accessible by the consumer which can lead to higher sales
⊚ Customers can create their own experience
Disadvantage
⊚ Start-up can be costly
Plan of Action #2⊚Addressing issue #3
⊚Target should expand globally at a smaller scale
Advantages
⊚ Diversify their revenue stream
⊚ Create a good local and global image of supporting communities
Disadvantage
⊚ Research and Development can be costly, but necessary
⊚ Economic and political risk
Recommendation ⊚We feel that Plan of Action #2 should be taken.
Reasons:
⊚The biggest issue for Target is its failed expansion.
⊚Global expansion is more profitable
⊚ Improving customer experience is a factor that can be implemented at anytime
⊚Establishing and growing the Target brand is essential to longevity
Opinion
References Kerin, R. A., Hartley, S. W., & Rudelius, W. (n.d.). Marketing (8th ed.).
http://smallbusiness.chron.com/oligopoly-retail-market-structures-33437.html
http://pestleanalysis.com/swot-analysis-of-target/
http://www.marketing91.com/swot-walmart/
http://www.valueline.com/Stocks/Highlights/SWOT_Analysis__Costco_Wholesale_Corporation.aspx#.Vw0GsvkrKUk
http://panmore.com/costco-wholesale-swot-analysis
http://www.businessinsider.com/meet-the-average-wal-mart-shopper-2014-9
http://fortune.com/2015/01/15/target-canada-fail/
http://fortune.com/2015/04/02/target-canada-store-closing/
http://investors.target.com/phoenix.zhtml?c=65828&p=irol-newsArticle&ID=2007911\
http://allthingsd.com/20110418/exclusive-wal-mart-paid-300-million-plus-for-kosmix/
https://corporate.target.com/article/2015/10/borderfree-international-announcement