Tom Dougherty, CEO – Stealing Share
26 August 2019
Have you been in a Target retail store lately?
It may be small steps, but the new initiatives for Target retail are somewhat encouraging for a brand desperately in need of an overhaul.
While annual revenue for Target has grown a bit in the last few years, it’s nothing like it experienced earlier this decade. Target retail often finds itself in the loop of battling Walmart, and losing.
We’ve chronicled the reasons why. Mainly, Target directly copies Walmart, while claiming that it’s somehow above the market leader in terms of style and product.
But have you been to a Target store lately? It feels as outdated as the fax machine. There isn’t that much difference between its stores and what you’d find at a dollar store. I’d say many of the big Walmart locations feel more upscale than most Target stores.
So Target retail is attempting new initiatives that hold some promise, which say something about the retail industry itself. For one, the brand is remodeling 1,000 of its stores before the end of 2020. That’s been long overdue.
“There’s nothing in the meaning of the Target brand to make these tactics emotionally preferred. No matter what Target retail claims, its brand is not upscale.”
Target retail going smaller, more efficient
But I’m more interested in its introduction of small-format stores, primarily to support digital sales. That is, you simply pick up product you ordered. You can argue that pick up is a table stake, and it is, and that Amazon makes pick up borderline irrelevant.
Nonetheless, it’s a realization that for Target retail to survive it must change. It’s opened 100 of these stores, mostly in big cites and around college campuses. And the plan is to open more.
What some retailers are realizing is that they have too many large stores that are too costly to survive as is. For example, Nordstrom is scaling back its number of stores, going the smaller but more efficient route like Target.
Of course, these are only tactics, not an overall strategy. There’s nothing in the meaning of the Target brand to make these tactics emotionally preferred. No matter what Target retail claims, its brand is not upscale. It still lives in the lowest common denominator field that Walmart currently rules.
Smaller and remodeled stores are a must for Target, and it at least signifies that its leaders are waking up. But they are still groggy. Not fully awake. Because the brand and its meaning needs serious attention.
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