Running head:

TARGET:

FROM MORE TO PAY LESS

Target:

From More to Pay Less Gregory Tatum Saint Leo University

TARGET:

FROM MORE TO PAY LESS Target: From More to Pay Less

The central problem for Target is maintaining their goal of affordable prices against a weakening economy and competitors who have an advantage over them when it comes to price. slump. Target got a shock during the 2008 economic

Consumers are supposed to "expect more, pay less" But during the slump, shoppers clearly opted

at Target.

for "always low prices" at Wal-Mart, the retail giant's old marketing tagline. Although there are several facts of relevance to the case, the glaring one was the urgency in solving the problem. An English clerk name Charles Caleb Colton once To put it

said, Imitation is the best form of flattery.

simply, Target is looking to the Wal-Mart model, lots of consumables at discount prices, to help it hold off any serious decreases in profit. Chasing other retailers to

low prices is a mistake as it is a battle that Target cannot win in. Target has spent years building its image

as a cleaner, trendier, and generally more pleasant shopping experience than its competitors. This image has The

had immeasurable advantages in the marketplace.

inherent danger of beginning to focus on price is that consumers may perceive less of a difference between Target and its competitors. This would tarnish Targets brand

TARGET:

FROM MORE TO PAY LESS

image and eat away at the tremendous brand equity that it has spent decades establishing. By moving to a focus on

price, Target is chipping away at one of their most important assets: their brand equity.

What is Targets alternative Course of Action (COA)? Well, for loyal Target customers like myself, there are plenty of options. First, Target can stick to what got

them to become the second largest retailer in the business until they reach number one, good quality name brand clothes at even more affordable prices. They would have to

negotiate with the brands themselves to see if this method would hurt the marketers profit. they would work it out. Second option is nationwide price cut storewide. strategy would definitely work until they get to the grocery portion of the store. Although, Target isnt This But Im certain that

considered a grocery store, the move should bring in more customers, more often. Target has allocated too much space in their stores for clothing and household goods that most people would not want to spend on with the credit crunch. Most consumers

feel that Target major in clothing and that their perishable goods are more expensive compare do other stores. Target should reduce their food prices and

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FROM MORE TO PAY LESS

increase the shelf space that they have allocated to perishable products to try and reverse their sales downturn. (Gregory, 2009). Here are my recommended solutions for COAs. With the

management system of the company and the strengths that it has, Target Corporation has bigger opportunities to still dominate and catch up with Wal-Mart terms of providing more quality and less price products and services to its clients or even have an opportunity to be the number one retail company in the whole region. Another opportunity that can be attached to the company is it would gain more customers if the company would be able to determine the latest trends for products to meet the demands of their target market. With the

continuous innovation of Target and the support that it shows, the company can gain loyalty from their customers to make them more competitive in the marketplace. Last and the best solution is price positioning adjusted to consumer behavior and reinforced through value marketing-message. Target needs to resort to price cuts to

increase the customer base, as more and more customers are trading down. The company through the advertisement

increased the emphasis on price in its well-established "Expect More. Pay Less" consumer proposition. This shift

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FROM MORE TO PAY LESS

of focus on pricing and value enhances the company's competitiveness. This will facilitate tapping larger

market as increased numbers of customers are opting for lower prices in the recent times. The continuous initiatives of the company in diversification of its revenue resources also open new opportunities to make the business become stronger to outgrow all its rival companies. Target continues to

remain focused on its products by strengthening and delivering on their slogan Expect More. Pay Less promises that they have made in the past (Our Mission, 2011).

TARGET:

FROM MORE TO PAY LESS References

Gregory, S. (2009). Walmart Vs Target: No Contests in the Recession. Time Business. Target Corporation. (2010). Annual report. Retrieved September, 2010. Ward, Stephanie Francis. ABA Journal93 (February 2007). Colton, C. (1851). Lacon, Volume I, No. 183.

Our Mission. (2011). Retrieved May 27, 2011, from Target: Company: Our Mission:

http://sites.target.com/site/en/company.