Group Members

M. Ali RazaKamil FarooqFatima Akram

Group #2

‘Target has Guest,Walmart has Customers’

Company case

TARGET

Agenda

• The Journey So far• Where it stand today?• Industry Analysis• Brand Identity Prism• Customer Thinking• Recession• Recovery• Conclusion

Journey So Far

1895

1920

1940

1960

1970

1980

1990

2000

Department store

Discount store bull’s eye logo

Electronic scanning Present

Shop within a shop Plano grams

Loyalty program online stores

Where it stand Today

Exclusive US retailer

Target is 5th largest retailer after Wal-Mart

No of stores 1803

Revenue FY08 $65bn

Profit Fy08 <$3bn

96% people recall Bulls eye logo

Expect more payless

Cheap Chick

Brand identity prism

Physique: red targeted logo

Physique: Mammoth logo

Personality: upper middle class, innovative, urban

Personality: 40, aggressive, unsophisticated

Relationship: Next door stylist

Relationship: Handy man

Reflection: stylish, price conscious

Reflection: Intelligent spender

Self image: conscious, lively

Self image: value, forward thinking

Culture: American, high on csr initiative.

Culture: American, workshop, Ruth less

Customer Analysis

Target WalMart

Target Customer Young, educated, sophisticated, fashionable

Middle age cost conscious customer

Customer Value Cheap Chic Best value for money

Retail strategytarget Wal-Mart

Product Home items – 40%.Consumable items like food, health items-20%.

Consumable items like food etc-45%.

Place Mostly In urban areas. Mostly in small town and cities.

Price Little high 1-2% then Wal-Mart.

Prices are very low.

Promotion Spend 2.3% on on advertisement.

Spend only0.3% on advertisement.

Presentation Attractive promotions. Larger then life products pictures.

Congested budget presentation.

People Highly trained and motivated workers.

Low trained, motivated contract workers.

Recession

Recession of 2008 sales of Target was falling for 8 months.

Sales Wal-Mart was increasing.

Problem lied in mix of the Target 40% shelf space was given to home and apparel goods. 20% shelf space was given to consumable goods like food45% of Wal-Mart's retail mix consist of consumable products.

Wal-Mart has always undersized targetWal-Mart annual revenue was 406 billion$.Target annual revenue was 65 billion$.

During Recession

• But in recession Wal-Mart bottom line increased to 5.9%. target profit Drooped down to22.3% which is 2.2billion$.

• They faced loss of 155 million $.• Out of which135million$ per credit loss in forth

quarter.

• Target also 47% of its receivable to Jp Morgan chase.

Recovery

• IN 2010 Target sales rose to 5%.• Profit up was whopping 54%.• Perception of target’s value was increased.• They study micro and macro environmental factors.• They made it better and followed it.• Targets “Pay less” strategy continued without wavering.• Some wall street analyst expressed that target will loose its distinctive feature if continued like this.

• Target also made mark on customers heart “ Target is a nice place to go. Wal-Mart may have good prices, but I rather tell my

friends that I came back from shopping at target”.

Conclusion• changing direction of large corporation is an up hill task

•It like reversing a freight train.•Company has to be determined.

•It must have patience •By better planning