target case study

I. SWOT Analysis of current situation (this can be a chart) but each area MUST be explained

Target Corporation opened its first store in 1962 with a focus on

II. How should Target Home continue to deliver on the brand promise of Expect More, Pay Less? What does “Expect More” mean in Home categories and how does the guest define value? In order to sustain growth, Target must continue to surprise and delight guests across all channels. How should Target Home’s strategy to provide consistent, cross-channel experiences come to life over the next two years?

Target Corporation has promised customers to “Expect More, Pay Less”. They have been a leader in the industry of lower priced products and convenience while maintaining a pleasant shopping experience. “Expect More” in home categories means that customers should expect to be pleasantly surprised by what they can get at Target for the “Pay Less” price. In the home category this means guests should be seeing modern and stylish products that are on trend. They should be seeing things they would want to go to a specialty store for available at their convenience at Target. “Expect More” makes guests expect value. Value for Target customers is a combination of things, as stated in the case, including price, assortment, and experience. To delight guests, Target needs to offer a wide variety of product at their pricing and really focus heavily on the experience.

        Target’s shopping experience is a huge factor that makes Target stand out. Target needs to take cross-channel experiences very seriously to impress guests. They can do this through improving their strategies of combining mobile and in-store shopping experiences in the home department. To make it come to life, Target could continue to use Cartwheel but offer more deals in the home department. Upon looking through the app, one will see that in décor and furniture there are the least amount of mobile deals. Target needs to improve their mobile experience in the home department. In store, you will see room arrangements and newest home décor assembled into a beautiful display that can help inspire guests to make purchases. Target could have several designed interactive rooms on their app, highlighting cartwheel deals and showing guests examples of the value their products offer. Target should also implement more social media campaigns promoting their Home category. Making their shopping experience more integrated online can help engage the customer and increase value.

III. Starting with the framework of the four P’s, provide ideas for how you would approach this challenge as a Senior buyer on a category within Home: Product, Price, Promotions, and Place/Supply Channel. (See case for specific questions to answer.)

As learned in class the four P’s are conformed by product, price, promotions, and Place/Supply channel. Each one of these components are vital when structuring a company, and also when trying to understand to then improve different sections of it. First, in terms of product we have to remember what Target promises which is “Expect more, Pay Less” this means the consumer or guest as they called their customers would pay the least amount of money for the best quality products they can offer. The modern shopping experience differs from the one older people were used to because as the case explains, nowadays guests at target shop with one hand on the cart and the other on their phone always checking for offers, and also spreading the word among friends of what is new in store. Consumers at Target describe the store merchandise stile as something aesthetic that goes with every stile. Target consumers are not always looking for low prices, they are also looking for quality and innovating products and that is what differentiate them from their competitors. The “expect more” part of their slogan means that Target consumers are always going to find high quality products. Low price does not always represent value to consumers, value is also represented as how well a product is made, which materials were used for the fabrication of it, and many other factors.

Moreover, there is the second P which is price. The second part of Target’s slogan says “pay less” and even though they as a company want to offer the lowest prices as possible they might sometimes not have prices as low as the competition but they will surely offer a better quality. For Target to keep delivering low prices, they need to have a good relationship among price and quality. According to the case, e-commerce sales should grow 61% by 2018, or $491.5 billion, while brick-and-mortar sales are projected to grow 12.8%, or about $5 trillion, over the same period. A good way for Target to capture customers eyes is by imitating with high end brands their products and give customers what they want at an affordable price, that way they will be paying less than the competition.

The third P is represented by promotions which are essential in the marketing strategy of any company. In order to attract more guests, Target should deliver well though promotions among different social platforms. We as a team would suggest Target to set the promotions through the strongest social media platforms which are YouTube, Instagram, and Facebook. These platforms are known for having a wide reach and also for making one message go around the world in a matter of seconds. Another suggestion would be promoting the company’s name through collaborations with social media influencers. Influencers are being considered more and more because of the power they have on people, in this case their followers. So, finding the right influencers to collaborate with would be one of our promotion strategies.

Last but not least, the fifth P represented by place. The location of a store defines how much it is going to deliver. Even though Target is already a well-known company, the majority of the people are not willing to take long drives to the store just to make a purchase. In order for Target to leverage store locations we would suggest them to open stores near the younger generation meaning college students or recent graduates. Finding a good spot will definitely determine how well a company is going to perform.

2. Please consider and address the areas that relate to your ideas above: Team Structure; Technology; Marketing; Product Categories; External Competition; Profitability in supply chain. Supporting proposal recommendations with information that addresses the why’s behind each topic.

The team structure of the company refers to the composition of an individual team or of a multi-team system. Senior buyers should take some important considerations while making decisions on assortment, pricing, and promotions. If our store is going to be located in a college students zone, we would suggest the home decor assortment should be mainly focused on Target room essentials which include products such as, desks, duvet covers, lamps, and many other essentials a college student would need when moving out and starting a new life. Moreover, Target should focus time upgrading their website and always being on top of what is new since their guests use this tool to be inform of what is new, what offers they could find in order to save some money, and also to check availability of items prior to going to the store. Technology plays a crucial role in today’s society, people is stating to become dependable of it so that is why we should take advantage of that by building a strong website where people feel comfortable navigating. In terms of marketing channel, we would 100% recommend social media channels. Social media platforms are taking the lead in terms of advertising. Millenials spend on average 5.4 hours per day on social media. Knowing this, we would suggest creating ads specifically designed to be launched on these platforms which are, Youtube, Instagram, and Facebook. Now within the home division target should prioritize the furniture section for it to be minimalistic, clean, and elegant. Buyers are looking for unique and affordable pieces to decorate their homes, so going with what is trending and transforming it to be our style would give it that unique touch.