TARGET IS FOCUSING on a new set of retailing initiatives to get through the present tough financial situation and make them well positioned to regain a hefty share of the market when the economy gets better. The plan is multi-faceted, but relies heavily on the firm’s “Expect More, Pay less” mantra that, according to Kathryn A. Tesija, executive vice president of merchandising, “has guided us through boom times and bad times.”
So far, Target has proven itself a master retailer, and there is no reason to doubt the new plan will do just what the doctor ordered to guide the mega store chain through the present rough waters.
— Merchandisers at practically every level of the business have something to learn here.
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Tesija says that “in this economic climate, we are emphasizing the ‘Pay Less’ part of the company strategy.” One requisite: To make sure prices match those of their main competitor, Wal-Mart. The company has also revised its weekly in-store advertising circular, using fewer products and larger images, all focused on lower prices.
PROMOTIONAL TECHNIQUES have been revised. For example, the number of endcaps that feature merchandise at lower prices has been significantly increased to show off the value items.
- The way you buy can make a major difference in your promotional items. Consider closeouts such as classic double row faux pearls spaced with fine link chain. These exquisite, grey-toned pearls, which can be extended to 18 inches and will never go out of style, offer an ideal value-oriented merchandising opportunity.
Of course, price is not the total story. Michael B. Francis, executive vice president of marketing, says that while customers are focused on price, he feels it is just as important to have an environment where people want to shop and where they can expect to get more at those lower prices. This not only maintains business, but helps build market share.
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WITH PRICE IN THE FOREFRONT of consumer consciousness, advertising has been revamped to communicate the value message. “We are being more explicit in terms of ‘Pay Less,'” Francis says. Now, three-fourths of the firm’s expenditures will be devoted to that position. “And every vehicle we create will contain a bolder statement about Target’s value,” Francis admits.
The fall-off of sales at posh retailing emporiums is also affecting the way Target does business. The firm is frankly running to pick up those disenchanted customers, telling them, “We have the same merchandise you’d find at Macy’s or Barney’s, New York.” Except, of course, at lower prices.
- To attract the upscale customer, try creating a new category of better merchandise which you can offer at value prices. For example, former customers of high-end stores will surely be attracted to classic style wholesale jewelry, especially with real gemstones. Consider a handsome tiger’s eye necklace of polished chips featuring a domed oval pendant framed in silver-plated flat wire, all adjustable to a fashionable 20″. Very sophisticated!
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NEWNESS IS WHAT IS SELLING in Target stores now. And, according to Francis, “Punctuating our stores with up and coming designers is effective.” One way of doing that is by featuring designers in print and circular advertising which underscores the designers’ own voices. The same can be done with popular brands that have a value reputation.
An important merchandising concept for 2009 is the company’s “rebalancing theme.” It involves finding new ways to drive traffic and emphasize value.
–“We’re still out there taking creative risks and taking opportunities.”
A recent campaign based on the traffic-driving strategy involved showing off essential items against a Dolly Parton vocal in the background. A big name that communicates positive messages both directly and indirectly!
- You can do the same simply by playing music that conveys a positive message or feeling in your store.
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TARGET IS ALSO INTEGRATING new product into its merchandising mix, with the idea of attracting customers it might not otherwise get. A major example is a grocery concept, now in its testing stage. Greg W. Steinhaffel, president and CEO, believes that food customers make more store stops and spend four times more than non-food customers. By adding food to the store’s merchandising mix, Target hopes to corral a bevy of new frequent buyers into the store.
- Just adding a new and exciting product category to your store can effect the same positive business results. For example, you might expand your business into high-profile caps, which are perennially popular best-sellers. Modified military caps look great on men and women alike, and come in white, black and khaki. These great looking caps sell to all age categories. Other terrific choices include “Level Headed” ball caps, and 3-D embroidered American Eagle ball caps. Put in some of these items and just watch the action!
ELECTRONIC WIZARDRY is also in Target’s going-forward strategy. Its goal is to put the entire store online and to integrate mobile commerce into its retail plan. To drive traffic to the company’s website now, an on-line free shipping offer has been increased from 25- to 50,000 items.
We can’t say enough about the importance of computer merchandising. If you‘re not really computer literate, change your ways now. This is the future and, like Target, you want to be in on it!