We have written extensively on the retail market category and fully understand the importance of location, pricing and emotional placement. Customer preference is a funny thing because it is always a construct of the basic value proposition. The customer always decides if going to a retail venue is worth it.
I do not mean that value is about lowest pricing, although it can certainly mean that. Value is a milestone set by the customer that can mean anything from convenience, discovery, distance, low price, familiarity, variety to any other value you can think of. Customers weigh this value against the retail venue and any competitor that plays in the same space.
Today, Target is in some trouble. It has announced the closing of all of its Canadian stores because it believes retailing, as it performs it in Canada, will not be profitable. But the real problem is declining same-store sales and a disappointing holiday sales season this year. What can Target do to stem this tide and become the juggernaut it once was?
Remember when Target arrived in local markets? It felt like a fresh approach to lower prices and a civilized shopping experience. It had the added dimension of discovery. It was fun to stroll through the stores and to find merchandise and clothing that delighted you because you were discovering what Target meant. Sadly, that freshness is now gone.
What is Target? When, as a consumer, does Target enter your considered set? It feels today (meaning it is a feeling and not necessarily based upon truth) that someone always does a better job as a specific competitor. For example, if you are shopping only on price, Walmart wins. (Walmart has also made great strides in upgrading the shopper experience and it has added greater selection to that equation.). If you are looking for designer clothing, every department store does better. Target is a general merchandise store competing in a market that seems to favor one general merchandiser and scores of specialty stores.
Reflecting market research, Target has added grocery to its stores. But rather than making Target a preferred destination, the grocery has just served to further dilute its meaning among shoppers. Today, fewer and fewer shoppers have Target on their radar.
The store layout is not always intuitive and the store flow is difficult to navigate. Recently, I needed an inflatable bed and I headed for Target because it was the closest retailer to my home. I wanted a higher-end inflatable queen-sized bed so I headed to home furnishings and bedding.
No air mattresses anywhere. I found an employee (hard to find in Target, by the way) and he pointed me to the camping and outdoor department. Sure enough, I found a $200 self-inflating airbed right next to the cheap vinyl $20 Coleman Camp gear. It was just another example of no one at the marketing helm of this leaky ship.
Target needs to be willing to challenge every preconceived notion. The stores have too much promise and too little value (in the complicated value proposition discussed earlier) to be allowed to follow the sea that took down Kmart and is quickly sinking Sears. Increased brand focus and an emotional trigger that is about the customer and not the store can solve the problems. Here’s hoping.