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Marketing Culminating

Target
by

Madeleine H

on 6 June 2014

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Transcript of Marketing Culminating

TARGET
By: Madeleine and Andreea
History of Target
After years of exploring the growing mid west markets, founder George Draper Dayton decided that
Minneapolis
would be the location best suited for his new store
In 1902, he opened
Dayton Dry Goods Company,
known as
Target
today
This store was known for its:
Dependable merchandise
Fair business practices
Generous spirit of giving
It is later renamed
The Dayton Company
to better reflect its variety of merchandise
1902-1911
1916-1920
The Dayton Company becomes a founding member of the Retail Research Association
The founder creates
The Dayton Foundation
with a
$1 million
endowment and a purpose to aid in promoting the welfare of mankind anywhere in the world
During a freight-handlers strike, Dayton's was determined to satisfy their customers by keeping their shelves stocked
They captured America's attention by using airplanes to transport goods from
New York to Minneapolis
1946-1950
The Dayton Company establishes the practice of giving
5 percent
of pretax profits back to the community
Following George Dayton's death, his son and all of his grandsons take leadership positions within the company
1953-1954
Dayton's opens a
commercial interiors
department specifically tailored to offer furnishings, fabrics and decorations for business and other public institutions
The company has it's
first expansion
and opens another store in Rochester, Minnesota
To meet the needs of the suburbs, Dayton's opens a store in The Southdale Mall
In doing this, Dayton's takes the then unheard-of step of placing top competitors together under the same roof
The store thrives and 3 more stores open within the following years
1960
In March of 1960, Dayton's introduces its first
Flower Show
, inspired by gardens all around the world for the customers to look at
This free annual event offered winter-weary shoppers a preview of spring's vibrant colors and fragrances
1960
Continued
The Dayton Company looks for ways to strengthen relationships with guests
Company leadership recognizes an
opportunity
to develop and introduce a new kind of
mass-market discount store
that caters to
value-oriented
shoppers seeking a
higher-quality
experience.
The company takes the first step toward
transforming
the organization from a family-run department-store chain into one of the
nation's largest
discount-store chains.
1961-1962
When they made the announcement of their transformation, Douglas J. Dayton said:
"combine the best of the fashion world with the best of the discount world, a quality store with quality merchandise at discount prices, and a discount supermarket...75 departments in all."
The goal for this new store was to be a fun, delightful and welcoming shopping experience
for the whole family

They named this new store
Target

"As a marksman's goal is to hit the center bulls-eye, the new store would do much the same in terms of retail goods, services, commitment to the community, price, value and overall experience."
Target differentiates itself from other retail stores by combining many of the best department store features —
fashion, quality and service
— with the
low prices
of a discounter
1967-1968
After a decade of significant growth, Dayton's transforms itself from a regional department-store company to a
national retailer

The Bullseye logo design is revamped into a more
direct and memorable
symbol of the company
1969
First distribution center
Begun the J.L. Hudson Company and Dayton's partnership
1974
Planograms are developed to deliver clean and well stocked shelves
1975
Target Stores becomes the
No. 1 revenue producer
of the Dayton-Hudson Corporation
Target introduces its weekly newspaper advertisement.
1979
Target Stores celebrates an organizational milestone after achieving
$1 billion
in annual sales by holding their first Billion Dollar Sale for guests
1988
Target becomes the first mass merchandiser to introduce UPC scanning at all Target stores and Distribution Centers
1989
Target partners with Chip Ganassi to form Target Chip Ganassi Racing
The partnership embodied all the best aspects of what the company represents — speed, excitement, a modern flair, trend setting and success.
1989
Target expands to the Southeast opening 30 new stores and becoming a national retailer with stores from coast-to-coast
1990
Target Greatland is unveiled; Fifty percent larger than a standard Target store, Greatland includes many changes that help create a better shopping experience for guests.
1994
Target Stores unveils its brand promise, Expect More. Pay Less.® to reflect the unique retail experience offered at Target
This promise is a natural evolution of Target's commitment to community giving and offering guests value, quality and service, all in a fun and inviting store environment
1995
The first Target store credit card, known as the Target Guest Card, launches
The first SuperTarget — which includes a grocery section with fresh produce, dairy, meat
Target becomes one of the first mass-market retailers to offer a comprehensive gift-registry service
Within the first year, more than 125,000 couples register
1998
Dayton-Hudson Corporation purchases the Associated Merchandising Corporation (AMC)
1999
Sonia Kashuk partners with Target to introduce the Sonia Kashuk Professional Makeup Collection
Target launches Target.com
world-renowned architect Michael Graves becomes the first of more than 75 designers to create an exclusive line of products for Target
1999
The original Bullseye, an English Bull Terrier named Arielle, makes his first appearance in a television commercial
Bullseye becomes the second dog ever to have his likeness displayed in Madame Tussaud's Wax Museum
Target sells its first GiftCards
2000
Dayton-Hudson Corporation is renamed Target Corporation to better reflect its core business.
2001
The Target Weekly Ad makes its first appearance on Target.com
Target introduces its exclusive private label, Market Pantry
2004
Target launches its in-store dollar section, See. Spot. Save
Target introduces the SuperTarget tagline "Eat Well. Pay Less.®"
2005
For the first time, Target exceeds $50 billion in annual sales
2009
Target expands fresh food offerings into stores nationwide
2010

Target launches a new, limited-time partnership with British fashion house Liberty of London
2011
Target announces its expansion into Canada, extending our stores and shopping experience beyond the United States
2012
Award-winning mobile app is created. It lets guests navigate a Target store, refill prescriptions, browse the Weekly Ad and more
2013
Target opens its first Canadian stores
Chapter 1:
What is Marketing?
Chapter 1: What is Marketing?
Target is a department store, which sells a
variety
of consumer goods, all produced by different brands and companies
Target’s product categories include: clothing, shoes and accessories for men and women, baby and kid items, patio and indoor furniture, house ware, electronics, entertainment, toys and health and beauty.

Chapter 1: What is Marketing?
Supply and Demand
Target receives its products from a countless amount of producers; therefore, its supply depends on what they need and are given by each supplier.
Target has a high demand; low prices mean more people will buy the product and Target is the second largest discount retailer in the United States; therefore, it has a reputation for its low prices.

What is Target?
Chapter 1: What is Marketing?
Corporate Organization
Target also provides the Target REDcard, which is a credit card that customers can use and earn points.
Target is an international company with 361,000 team members around the world, and headquarters in the United States, Canada and India.
Target’s corporate headquarters is in Minneapolis, Minnesota, U.S.A., it has over 10,000 team members working there and is the place where Target was first started. In the United States, Target has over 1,780 stores in 49 states and over 300,000 team members.
Target's Canadian headquarters is in Mississauga Ontario, and currently has 600 workers; it is at the core of where many Target stores are in Canada.
Target’s Indian headquarters is in Bangalore, India with over 2,500 team members working there.

Chapter 2:
The Consumer
Chapter 2: The Consumer
Product Life
Since Target carries a
variety
of products from different brands and follows different trends and fads so the product life varies e.g. Clothing items last for only a season, holiday items fluctuate seasonally
Chapter 2: The Consumer
Demographics
Target carries everything from clothes and food to toys and sports equipment so it provides products for
all genders and ages.
However Target targets consumers of a
higher income
as opposed to Walmart whose customers average household income ranges from $30,000 to $60,000. Targets customers have a median household income of $64,000 a year.
Chapter 3:
The Competitive Market
Chapter 3: The Competitive Market
Competitive Advantage
Since Target carries a variety of
up to date products
, they maintain a sustainable competitive advantage as they can keep their product selection updated to current
trends and fads
.
Another sustainable competitive advantage is
customer loyalty
; Target uses
relationship marketing
to make customers feel that target is their community store.
They focus on creating an excellent
customer experience
and has even been named the fourth highest-ranking company by the 2013 Forrester Customer Experience Index.
Their non-sustainable advantages are
promotions
and the known
quality
of their products.

Chapter 3: The Competitive Market
Market Share
Target’s market share is 26% as of 2012
In Canada, Target is a part of a
duopoly market
in direct competition with Walmart
Costco is also a major competitor but is not the same type of store as Walmart and Target. In the United States, K mart is also a large competitor with both Walmart and Target.
Target is considered a
higher end
discount retailer than Walmart.
Target also competes in different sectors because of their different variety of products.
Target
Apparel
Sears
The Bay
H&M
Toys
Toys R us
The Disney Store
Pharmacy
Shoppers Drug Mart
Pharma Plus
Pharmasave
Rexall
Grocery
Sobey's
Longo's
Fortino's
Metro
Zehr's
Whole Foods
Costco
Competitive
Space
Chapter 4:
Marketing Research
Chapter 4: Marketing Research
What type of Marketing Research Does Target do?
Target gathers
primary data
, focusing on
qualitative data
. They collect
consumer profiles
from both online and in store sales.
Target also uses
consumer-tracking devices
; they keep a close eye on what they call "guest investments". One way they do this is through what each person buys at their store,
surveys
and their Target REDcard credit card which tracks purchases even at different stores. Especially if the customer buys from a competitor like Walmart, they will analyze what they bought and use that to improve.
They track what their guests purchase, so for example, they can see if a guest purchases a certain brand of tooth paste that isn't a top seller. However, if that guest also buys groceries, toys and clothes, taking that unpopular toothpaste off of the shelves could be the reason why that individual guest no longer shops at Target any more.
Target ensures that they have a
wide selection
of brands so that if a guest is deeply invested in a specific brand, they will be able to find it at target. Even if a product is a low seller, these brands and products are
trip drivers
for some guests

Chapter 5:
Product Development
Target is recognized as a leader in
innovation
across the retail industry. From pioneering the concept of
designer partnerships
to consistently being best in class in
store design
, Target remains focused on meeting and exceeding its guests' needs and remaining relevant.
Target’s collaborative spirit is in everything they do. Instead of doing all of the design, branding, and other creative work in-house, Target works with different agencies on their content development. Target oversees 10 agencies, 4 digital partners, and 3 branding studios.
Target relies on their
suppliers
to provide inventions and innovations, and they decide what would be best in their store and appeal to their target market.
Chapter 5: Product Development
Product Development
Chapter 5: Product Development
Collaborations
One of Targets biggest successes is most of their numerous collaborations and partnerships over the years.
By aligning themselves with designers and other brands that are modern, stylish and fun they reflect this image onto themselves.
Target collaborates with
top tier designers
; the products are fashionable, popular, and affordable.
Just a few of their successful designer collaborations over the years include: Missoni, Luella, Proenza Schouler, Rodarte, Zac Posen and Isaac Mizrahi
When Target launched their Missoni-designed clothing and product, the Target website crashed and the collection sold out which speaks volumes about Target’s success in collaborating with designers
Chapter 5: Product Development
Collaborations
Most recently introduced collaborations are with Jason Wu and Prabal Gurung
Phillip Lim Promotional Video
Chapter 5: Product Development
A failure Target experienced was the unsuccessful partnership with Neiman Marcus last holiday season.
The main reasons that consumers were not impressed was the price
Although it was cheaper than regular Neiman Marcus clothing, it was still more than what Target shoppers were used to paying
Also, the quality was markedly inferior to regular Neiman Marcus clothing.
It did not fit in with Target’s
brand image
of quality clothing for less.
Product Failures
Chapter 6:
Positioning and Branding
Chapter 6: Positioning and Branding
Type of Positioning
Targets primary type of positioning is
long- term
,
low end
positioning
They have kept their reputation as a quality, higher end discount retailer for as long as they have been around
They have also been doing designer collaborations longer than most other companies, and have maintained that
discount designer image
.
Chapter 6: Positioning and Branding
Logo
Walmart's major message is "save money, live better" when target's is "expect more, pay less"
Target customers can look forward to a bright, clean, well stocked store, with great customer service, thus expecting more, but pay a reasonably low amount for their quality products.
Target’s logo is the red target; it has not changed much since the start of the company because it is simple and effective
Chapter 6: Positioning and Branding
Slogan
Chapter 6: Positioning and Branding
Mascot
from 1962 until 1968:
Target’s official ambassador since 1999 is Bullseye the dog, he is a white pitbull with a red target around his eye
Bullseye has made appearances on the red carpet, gone to popular events, been in parades, travelled the states and has his own youtube channel
Chapter 6: Positioning and Branding
Brand Extension
The Target Corporation has opened other branches including:
SuperTarget
SuperTarget is a chain of hypermarkets first opened in 1995.
They offer everything found in a regular Target as well as:
a full grocery selection, fresh produce, bakery and deli, with most locations having a Target Optical. Many SuperTargets feature Starbucks Coffee, Pizza Hut Express, Taco Bell Express, Target Pharmacy, The Studio @ Target (a portrait studio), Target Photo, Target Mobile (a Wireless kiosk), and a Wells Fargo Bank or U.S. Bank.
Target Greatland
Target Greatland is a chain of general merchandise superstores opened in 1990
They carry a larger selection of general merchandise. The construction of new Target Greatland stores has been phased out and current Target Greatland stores are being converted to general merchandise Target stores or SuperTarget stores
CityTarget
The first CityTarget opened in 2012
CityTarget is the name for a smaller-format, downtown Target store aimed at the urban market and located in large American cities.
The assortment is focused towards urban living, but carries many of the same products.
PFresh
PFresh was created in 2009
These stores include an array of perishable and frozen foods, meat, and dairy. They heavily focus on Target's owned-brand products such as Archer Farms and Market Pantry
Chapter 6: Positioning and Branding
Brand Acquisition
Target has also acquired a variety of
smaller brands
that they
sell exclusively
at their stores
These acquisitions are successful as they set Target apart from their other competitors.
Take for example C9 by Champion; people who like the Champion brand will come to Target to find this exclusively owned line.
Coke or Pepsi?
Target is definitely
Pepsi.
They market themselves as a modern, fresh and trendy discount retailer as opposed to Walmart. Walmart would be coke in Canada, who has been around longer
Target markets themselves as young and stylish, definitely as Pepsi even though they have been around for more than 100 years.

Chapter 7:
Pricing
Chapter 7: Pricing
Target’s prices are
elastic
; consumers will not shop at Target unless their prices can compete with those of other discount retailers.
That way, Target determines it’s pricing through a variety of strategies the most important for them is
Benchmark Pricing.
Target employs
Discount Pricing
to be able to compete against Walmart
Chapter 7: Pricing
Pricing Policies
from 1968 until 2004
Once Target gained brand awareness; they could remove the brand name from their logo and be easily recognized. This is the logo they use today, with or without the writing:
Target uses
Leader Pricing
; they put low prices on some popular products to attract customers to their store.
They also use
going rate pricing
, Target examines the prices of their competitors and then sets their own prices broadly in line with these. In Canada, Target decided their prices will be based on the Walmart prices; they are very similar.
Target also uses
Psychological Pricing
, by deducting cents to make it subconsciously appear cheaper.
They also price high value goods at slightly lower prices to play on consumer’s perceptions that they are getting high value at a very low price and although it is lower, they are still making a large profit off it.

Chapter 8:
Distribution and Logistics
Chapter 8: Distribution and Logistics
Distribution
Chapter 8: Distribution and Logistics
Inventory Control
Chapter 9:
Advertising, Promotion and Sales
Chapter 9: Advertising, Promotion and Sales
Target uses every type of media because it has to appeal to many different consumers. They use different types of media sources depending on what they are advertising. For example, they would put an ad for a new clothing collection ad on fashion websites.
However Target mainly uses
television, radio, and online
to appeal to the most number of consumers.

Media
Chapter 9: Advertising, Promotion and Sales
Public Relations and Publicity
Chapter 9: Advertising, Promotion and Sales
Promotions
One of Targets most successful promotions is the
REDcard credit promotion
It offers 5 percent off of every purchase at Target and a variety of other benefits. The number of customers applying for the REDcard is steadily increasing and once shoppers get a REDcard, they buy a lot more at Target, an average of 44 percent more.
The purpose of the REDcard rewards program is to build customer loyalty and get customers to shop more at Target. Also, the card makes customers more likely to buy expensive items such as appliances at Target because of the savings.
Target also constantly has
online deals and coupons
; they have free shipping on orders over a certain price or sometimes completely free shipping with easy returns. This encourages e-commerce and puts them in competition with large online retailers such as Amazon and EBay.
Target has also recently introduced price match guarantees, if you find a price that is better at Target.com, Amazon.com, Walmart.com, BestBuy.com, ToysRUs.com, BabiesRUs.com or in a competitor’s local printed ad, the Target store will match the price at time of purchase or even up till a week after. This promotion plays into Target’s branding as a low price retailer.

Chapter 9: Advertising, Promotion and Sales
Can't Wait to Meet You Neighbour- T.V. ad
Target focuses on building strong relationships with their regional community, one way they do this is through
community work and philanthropy.
They focus on efforts involving: education, health and well-being, responsible sourcing, safety and preparedness, team members and volunteerism. Each year, they’ve given 5 percent of their profit to communities, which adds up to more than $4 million each week.
Target also uses
special events
as publicity that are designed to reach their target audience. To appeal to their target audience of fashionable, modern, women, they host red carpet events and invite celebrities. These event bring great publicity and further the brand image.

Swot/Aida
S- this ad is strength because Target is known as a top discount retailer in the United States, and recognized as that by Canadians
-Target is known as a trendy, stylish, modern American company and now a new and exciting addition in Canada.

O- this is an opportunity because Target is expanding into the Canadian market and becoming international.
-It’s an opportunity to show Canadians that Target is becoming part of the community.

W- it’s a weakness because they are the “new kid” and not as well known as Walmart is.

A- it captures viewer’s attention because of the popular, catchy, Canadian song, Bullseye the dog riding on the sidecar of a motorcycle and all the Canadian sights and people.
I- it piques the viewer’s interest because they want to see what Target is all about and what they are bringing to Canada.
D- it makes people desire to see the new Target stores, look at their merchandise and discover “what it’s all about”.
A- consumers will go out to one of the newly opened Target stores in their area, buy some products and keep Target in mind when deciding to shop next time.

Spring Style- T.V. ad
Chapter 9: Advertising, Promotion and Sales
Big Dog- T.V. ad
Chapter 9: Advertising, Promotion and Sales
S- Basically the same as the other two ads, Target being known as a top discount retailer in the United States.

O- this ad is about the opportunity to lure customers to do their holiday shopping at Target.

A- it captures the viewer’s attention through the cute Christmas town, upbeat music, and giant dog walking through the streets.
I- it piques interest in what the dog is doing and to find out what holiday deals there are at Target.
D- it creates desire to see the holiday items at Target, and save money with Target rewards.
A-it puts Target on the list for stores to stop by for holiday shopping or keeps it in mind when looking for something over the holidays.

Target has a 1.3 million sq. ft. Distribution centre in Milton Ontario
This is one of 3 of the planned distribution centres in Canada and will be the hub of Target’s supply chain and logistics support for its retail network
Target uses
trucks
as their main channel of distribution
Target uses marketing research to keep track of which products are in high demand and lower demand
The products in high demand have higher inventory numbers to meet the demands of customers
Products of lower demand have
lower inventory
numbers to ensure that none of these products go to waste and cause the company to lose money
Chapter 9: Advertising, Promotion and Sales
Target plans to open
124 stores in Canada
this year
They will open in more
prime locations
once they have improved in the ones they have open now
We see target becoming a large part of the
Canadian retail market
and continuing to go head to head with Walmart
We also believe Target will continue to
collaborate
with popular designers and stay up to date with
trends and fads
as they have been doing

Print ads
Future
S- Target is known as a fashionable discount retailer, that provides designer clothes at an affordable price.
-Target’s strength is their stylish clothing for every season, like those showcased in this commercial.
-This is a lifestyle ad because it shows that shopping at Target leads to a stylish, fun life. The models are living the Target lifestyle, which is colorful and energetic.

O- this is an opportunity to showcase their new spring clothes and get consumers to come to Target to buy new seasons clothing.

A- it captures viewer’s attention because of the catchy song, bright colors, nice landscape, and multiple young, pretty girls in colorful, stylish clothing.
I- it piques the viewer’s interest because of the beautiful clothing. The target market will immediately be interested in looking at the clothing styles shown in the ad.
D- it makes the viewer desire the colorful, fun, clothing in the advertising. The Target “lifestyle” will appeal to them.
A- either they will go to Target right away to check out the new clothes or next time they have to buy something else they will choose Target because they would like to look at the clothing too.
-Also, it will create top of mind awareness for Target, as one of the best discount retailers with stylish clothing.
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