Target Corporation retail store was among the top five retailers in the United States of America. The retail store offers high quality merchandise at discounted prices an aspect that attracted customers to their retail stores. In addition, the stores are well organized where they are spacious, clean and the customer has an easy access to the products they need. Target Corporation has 1,799 retail stores and 38 distribution centres in the United States.
The retail store began in 1881 as Marshall Field & Co; it changed its name to Target Stores in 1962 which sold merchandise at discounted prices. In 1967, the store become public traded where they offered the public an opportunity to purchase common stock in the company. In 1975, the Target stores made tremendous profits and they ended up being ranked the 7th largest retail store (Target Corporate, 2017).
The store began opening new stores in different parts of the country in the 1990’s. The retail stores mission statement focuses on 4 elements that are; ensuring customer satisfaction, delivering excellent customer service, giving back to the society and ensuring continuous growth for the shareholders. The retail store works towards ensuring that customers get value for their money when they purchase at their different outlets Target Corporate, 2017).
The downfall of Target Corporation began when the management decided to venture into Canada with the aim of achieving their expansion objective. The company opened a number of 124 retail stores in Canada but poor supply chain and marketing strategy resulted in immense losses for the store. The corporation closed most of their stores in Canada and lost $ 5.4 billion which led them to revert back to the USA market to recoup (Kilgore and Garcia, 2017).
The management plan to double as a discount retail outlet and also sell designer products was the second blow for the retail store. The customers are central to any business and their needs have to be fully met if the business wants to succeed. The management were delving into the Wal-Mart strategy without prior planning. The move affected the retail store immensely as its customer associated this new business venture with an increase in the prices of products. Most of the customers moved to other discounted retail stores like Dollar Tree, K-Mart, and Family General among others (Jennings, 2015).
The shift in the customers to other retail stores not only decreased the profit revenues but also contributed to the decrease in the stores market share. There is a need by the management team for the store to reposition itself or risk being pushed out of business.
The USA retail industry is very competitive with local small retail stores and a number of big retail stores mushrooming in different parts of the country. The retail stores have identified their own target market and have geared the prices and organization of their stores to satisfy their needs. The Dollar Tree targets the low income earners where they offer their products at the price of $1 or less. K-Mart, BigW, Dollar General, Wal-Mart, Macy, Bloomingdale, Nordstrom are some of the retail stores that target the high end customers and middle income earners.
Based on the analysis above, Target Corporation does face stiff competition from various retail stores and with the high shift in their customer base to their competitors places the retail store at a high risk.
|
Retail Store |
Market share |
Retail Store |
Market Share |
Retail Store |
Market Share |
Retail Store |
Market Share |
|
Wal-Mart |
14.26 |
Walgreen |
1.75 |
TJX companies |
0.47 |
Amazon.com |
2.18 |
|
Kroger |
3.05 |
Safeway Inc. |
1.24 |
Berkshire Hathaway Inc. |
1.47 |
Dollar Tree |
0.61 |
|
Target |
2.08 |
Costco |
3.28 |
Best Buy |
1.02 |
Nordstrom |
0.46 |
|
Others |
69.61 |
(Source: https://csimarket.com/stocks/competitionSEG2.php?code=TGT)
According to Kotler and Armstrong, 2014 market share reflects the competitive position of a corporation in a particular industry. It is determined by taking the sales revue that the business establishment does make in a specified period. Target Corporation has been losing its market share to its rivals. In 2014, Target Corporation dropped to position four on the top 10 U.S retailers (Jennings, 2017).
The store has failed to anticipate the needs of its customer and change its marketing approach to satisfy them. The store has arrived late hence missing the frenzy in online shopping, having gas pumps at their stores, having smaller stores in strategic customer locations and finally the club style shopping trend. Finally, the introduction of the transgender bathrooms at their stores has given them another sharp blow that has further weakened their competitive position (Kilgore and Garcia, 2017).
Target Corporation needs to reposition itself in the retail industry if it still has the desire to maintain its position among the top 10 U.S retail stores. The decline in sales and the continuous loss of their market share is a reflection that the corporation needs a solution that will salvage their position in the market (Target Corp Comparisons to its Competitors, Market share and Competitiveness by Segment – CSIMarket, 2017).
Marketing research is integral in coming up with an immediate solution since it involves an in-depth analysis of the competitors, customers, and the retail industry. The research will clearly pinpoint the areas the retail store needs immediate improvement. In addition, it will provide a clear reflection of Target’s positioning in the market. Finally, provide direction on a long term marketing strategy that will enable the retail store to satisfy the needs of their customers hence regaining their market position (Keegan and Green, 2013).
The macro-environment analysis often deals with the external evaluation of the environment where a corporation does exist. Macro-environment analysis has six factors which are political, economic, social, technological, legal, and environment (Keegan and Green, 2013).
The change in the government regulation and policies has an impact on the operations of the retail sector. The increase in taxation by the government has a ripple effect on the retail stores where by they tend to incur high expenses in the instance they try to hold the price constant. The decrease in the US tariffs and Europe Multi Fiber Agreement has had a positive impact on Target Corporation and other retail stores as they tend to benefit from decreased cost of labour (Datamonitor, 2007).
The increase in the cost of prices around the globe has a negative impact on Target Corporation as it makes the prices of their products to increase. The introduction of top designer products in the retail stores makes the customer associate the rise in prices with the new movement which has deterred customers from the store. Competitors in the retail industry like Wal-Mart are looking at low cost destination sourcing an aspect that has made it continue to prosper despite the recession in the economy. Target Corporation is only located in the USA an aspect that makes it to be more at a disadvantage when compared to one of its biggest competitors (Garcia, 2016).
There is a high increase in the number of retirees in the USA while the young people coming from the universities only have theoretical knowledge. The retail stores like Target Corporation have to invest a lot of finances in training the young people in the necessary skills required to run their establishments. Additionally, the USA has a large influx of immigrants who offer cheap labour when compared to the American citizens. The cheap labour will be beneficial for the retail stores as they will tend to save more (Thomas, 2017).
On the other hand, the detriment in hiring these workers is that the American workers will lose their jobs and aspect that will decrease the disposable income that they spend in the retail stores. At the end the Target retail stores will not be able to improve their sales revenue or recapture their market share (Ahearn, 2015).
Target Corporation has opened up an online retail stores to tap into the online shopping customer frenzy. Customers can easily purchase various items from the retail store’s website. The retail store also uses the latest software and technology in their various retail stores to improve the customers’ shopping experience (Target Corporate, 2017).
Target Corporation revealed their corporate social responsibility policies to the public. The corporation aims to be environmental conscious in their retailing by encouraging their suppliers to embrace environmental viable practices. The vendors are expected to decrease their carbon dioxide pollution, use resources effectively and to focus on recyclable materials. The retail store is working towards offering their customers eco-friendly products in different categories in their product range (Target Environmental Policy, 2016).
Target Corporation has been faced with a number of lawsuits some of them are racial discrimination and selling banned aerosol confetti in the USA (NFB, 2008). The retail store has been working hard towards redeeming its reputation by paying the fines charged and engaging in positive publicity.
|
Strength |
Weakness |
|
· Strong brand recognition · High employee retention · Endorsement by celebrities · Innovativeness |
· Law suits · Limited operations where they are only based in the USA · Rigid business model that does not reflect the new era · Inability to tap into the new customer shopping trends effectively |
|
Opportunities |
Threats |
|
· Expansion into other countries · Concentration on products with private identities · E-commerce |
· Stiff competition · Harsh economic conditions |
Target Corporation is ranked position 4 in the USA top 10 retail list. The retail store is also in the Fortune 1000 companies an aspect that shows that it is one of the largest retail stores in the USA market (Fortune 1000 companies, 2016). Target Corporation in the first quarter of 2017 reported an average growth rate of +0.69% which is a positive sign that the organization is heading in the right direction. Presently, the retail store reported a net margin of 3.95% which is minimal when compared to its competitors in the retail industry. Target Corporation presently controls 2.08% of the market share (Datamonitor, 2017).
The research will utilize both primary and secondary data. Primary data will be derived from first hand research conducted on the retail industry. The advantages of using primary data are that it will enable one to get up to date information on the market, customer perception and attitude (Hiew, 2005). The information will be essential in resolving the research problem based on the outlined research objectives.
Contrariwise, the secondary data will be derived by compiling a series of research conducted by other researchers, journals, articles and information present on various websites. The advantages of using secondary data in the research are that it will complement the data collected. Furthermore, the secondary data will clearly pinpoint the gaps that the other researchers found in their research hence providing a suitable point to begin the primary data (Cooper and Schindler, 2011).
The mixed methods research design will be employed in conducting the research to enable us to get conclusive results on the research problem. The design has been selected because it compounds both the qualitative and quantitative approaches that are pertinent in this research. The study will utilize the mixed methods research design. Market positioning and market share recapture will utilize the quantitative approach while when analysing the customer perception and attitudes the qualitative approach will be used.
The survey questionnaire will be used in the quantitative facet which will enable a correlation and regression analysis to be carried out on the various variables that will be used in the study. According to Cooper and Schindler, 2011, inferential statistics plays a major role in displaying the existence of any cause effect relationship between the dependent and independent variables. The existence or non-existence of a relationship will facilitate the resolution of the identified research problem in this proposal.
The cross-sectional research will be employed to give a wider picture to the research problem and facilitate the achievement of the identified research objectives. Cross-sectional design refers to a research conducted within a predetermined time period, the approach is used to set time boundaries from when the research will be commenced and completed (Rivers, 2016).
As mentioned, the qualitative perspective will be used in the primary data collection and it will employ descriptive research techniques in its survey questionnaire. The questionnaires have been selected because if properly utilised they will tend to satisfy the objectives of this research proposal.
The target population are Target Corporation present and potential customers from each town where the retail store is located. The selection of the two types of customers is to ensure that the retail store gets a wide perception of the needs of the customers with respect to their product offering. Additionally, it will eliminate any biasness that may be provided by the present customers who visit the store on a regular basis.
The probability sampling technique will be employed in the research because it provides the entire population with an opportunity of being randomly selected. Probability sampling provides an authentic reflection of the needs of the entire population an aspect that will be beneficial in fulfilling the research objectives of this proposal (Cooper and Schindler, 2011).
The simple random sample will be used to ensure that no biasness is involved in the process. The questionnaires will be placed at the entrance where the customers after picking one will be led to a room within the store for them to fill the questionnaires.
The targeted population for the study comprises of 340 people from each town where the Target Corporation has established their retail stores. In order to ensure that customers participate in the research incentives of free shopping for goods worth $ 430 will be provided at the retail stores. The target population will provide adequate, relevant and reliable information if the response rate is 96% in each town.
The research design section has stipulated that the mixed method approach has been proposed to be used in Target Corporation research. The survey questionnaire will collect both qualitative and quantitative data that will be derived from the responses provided by the respondents. The data will be analysed based on the research objective outlined in this research proposal with an aim of resolving the research problem mentioned in the proposal.
Mean score, Chi-Square, Standard deviation and percentile are descriptive statistical techniques that will be employed in analysing the quantitative data. When it comes to showing the different scoring of the respondents in the different sections of the questionnaire the percentile approach provides a holistic approach (Hiew 2015).
Graphs in the form of pie-charts, line graphs, and scatter diagrams will be used to represent the qualitative data. The graphical, tabular and pictorial approaches are used to provide a layman understanding of the data (Cooper and Schindler, 2011). The approach is essential when one wants to clearly depict the changes observed in the data collected from the different respondents in the various towns where Target Corporation has retail stores.
The data derived from the questionnaires captures a number of hypotheses. Section A was to determine consumer perception and attitudes on the brands at the department stores, Section B was to determine ways to communicate to the customers the Target positioning in the retail market and Section C was to determine ways to restore customer confidence in the prices of items offered at Target stores. The last section C will utilise the regression model in analysing the dependent and independent relationship existing between customer confidences in the prices based on a number of variables that will be outlined in the questionnaire.
Y=a+b2x2+b2x2+b3 x3+b4x4+b5x5+b6x6+e where:
Y = Customer confidence in the prices
a = The Y Intercept, b1, b2, b3, b4, and b5 are the regression coefficient of respective variables;
e = is the error term;
X1 = Competitors prices
X2 = Introduction of top notch designer products
X3 = Opening new stores
The timelines propose the time that the entire research will take to complete and outline the anticipated project cost.
|
Item |
Start |
Completion |
Duration |
Cost |
|
Project Agreement and Approval |
1st June |
6th June |
6 |
|
|
Development of questionnaire |
7th June |
10th June |
3 |
$ |
|
Collection of data |
11th June |
11th July |
30 |
$ |
|
Data consolidation |
12th July |
15th July |
3 |
$ |
|
Data Analysis |
16th July |
16th August |
30 |
$ |
|
Results Reporting and Recommendations |
17th August |
19th August |
3 |
According to the AMSRS code of professional research is different from other activities as it involves the collection of information using various accepted techniques then the analysis of the information about organizations or individuals with an aim of obtaining knowledge or facts that are pertinent in decision making (Code of Professional behavior-AMSRS, 2017).
The AMSRS clearly stipulates that confidentiality should be upheld when gathering information from the fields. In the case the information is to be disclosed the anonymisation clause has been introduced to remove any information provided by a respondents that may lead to the identification by other people. The information can be disclosed only if the respondents give their consent. In the case of, confidential files are being used in the research the source has to be disclosed this aspect does override the anonymity of the respondent (Code of Professional behavior-AMSRS, 2017).
The proposal, commissioning and design the research members have to seek the permission of other practitioners in the instance they intend to use their works in their research. When designing the research it should be done with an aim of satisfying the quality and specifications standards that the client has consented to. Finally, the research members have to ensure that they have a written contract and an internal commissioning document that does protect their responsibilities and rights during the entire research process (Code of Professional behavior-AMSRS, 2017).
On the data collection, the members have a responsibility of ensuring that the data collection process fits the aim of the research with respect to the needs of the client. The respondents must be informed about the process of data collection prior to the start of the process. Thirdly, the respondents should not be misled when they are taking part in the process and that the personal information gathered is relevant and not obtrusive to the respondents. Finally, the design adopted in the collection and processing of the data is appropriate for the selected audience and purpose of the research (Code of Professional behavior-AMSRS, 2017).
On the informed consent the respondents should be provided with sufficient information to allow them to make informed decision with respect to the disclosure of their personal information. The information to be provided include, the purpose of the research, the organization carrying out the research, the techniques to be used for example recording, the people who will have access to the recording, the level of anonymity that they will be provided. Finally, the research should be limited to the selected spaces where notices have been placed to inform the public that research is taking place in that place(Code of Professional behavior-AMSRS, 2017).
Finally on the analysis and reporting of findings the members should ensure that the report fulfils the research objectives. The research should be easily available to the people who want to access the information. The clients should be allowed to determine the level of quality they need in the data collected as long as they are ready to cover the additional research cost. The members should ensure that there is enough supporting technical information that will authenticate the research findings. The findings should not be misleading to the client or the public that has access to the information. The outputs clearly state the differences between factual information and opinions with respect to the research. Lastly, in the case that the members are aware that the findings of the project have been misconstrued by the client they have the right to refuse their names being published in the findings (Code of Professional behavior-AMSRS, 2017).
References
Ahearn, B. (2015). Target Announces Store Growth Plans for 2015 Including Several Smaller Format Stores. Innovativeretailtechnologies.com. Retrieved 24 May 2017, from https://www.innovativeretailtechnologies.com/doc/target-announces-store-growth-plans-for-including-several-smaller-format-stores-001
Bruce. C. (2007). Target fined $120,000 for Spooky String. Bizjournals.com. Retrieved 24 May 2017, from https://www.bizjournals.com/twincities/stories/2007/09/daily20.html
Code of Professional behavior-AMSRS.. (2017). AMSRS.com. Retrieved 24 May 2017, from https://www.amsrs.com.au/documents/item/194
Cooper,.D,&Schindler,.P.(2011).Business research methods(7th Ed).Boston;McGrawhill
Corporate Social Responsibility, (2016). Target Corporation. Retrieved 24 May 2017 from htpp:sites.target.com/site/en/company/page.jsp?contentId=WCMP04-034096
Datamonitor. . (2016). Datamonitor Target Corporation Profile. Retrieved 24 May 2017 from ESCO database
Environmental Responsibility. (2016). Target Corporation. Retrieved 24 May 2017 from, https://sites.target.com/site/en/company/page.jsp?contentId=WCMP04-034097
Fortune 1000 companies. (2016). One Source Website. Retrieved 24 May 2017 from, https://www.onesource.com/free/Company/FortuneList/Fortune/0
Garcia. T.( 2016). Walmarts market share gain in grocery is targets loss analysts say. Marketwatch.com. Retrieved 24 May, 2017, from https://www,marketwatch.com/story/wal-marts-market-share-gain-in-grocery-is-targets-loss-analysts-say-2016-09-12
Hiew, J.F. (2005), Multivariate Data Analysis: A Global Perspective, Pearson Education Inc., NJ.
Jennings. D. (2015). Revenue shows target is losing market share. Seekingalpha.com. Retrieved 24 May, 2017, from https://seekingalpha.com/article/28465-revenue-shows-target-is-losing-market-share
Keegan, W. & Green, M. (2013). Global marketing. Boston, Mass. ; Munich [u.a.]: Pearson.
Kilgore, T., & Garcia, T. (2017). Target suffers record stock price plunge. MarketWatch. Retrieved 24 May 2017, from https://www.marketwatch.com/story/target-suffers-record-stock-price-plunge-2017-02-28
National Federation of Blind (2008). Target Corporation sued for discriminating against persons who are blind, Employment Law. Retrieved 24 May 2017 from, https://hr.cch.com/news/employment/0033006a.asp
Peterson, H. (2017). Kroger has a new plan that should terrify Walmart and Target. Business Insider. Retrieved 24 May 2017, from https://www.businessinsider.com/kroger-has-a-plan-to-to-take-down-walmart-2016-8
Rivers, J. (2016). Cross-Sectional Study: Definition, Advantages, Disadvantages & Example – Video & Lesson Transcript | Study.com. Study.com. Retrieved 24 May 2017, from https://study.com/academy/lesson/cross-sectional-study-definition-advantages-disadvantages-example.html
Target (2016). Annual Report. Retrieved 24 May 2017 from, https://sites/target.com.site/en/company/page.jsp?contentId=WCMP04-051711
Target Corp Comparisons to its Competitors, Market share and Competitiveness by Segment – CSIMarket. (2017). Csimarket.com. Retrieved 24 May 2017, from https://csimarket.com/stocks/compet_glance.php?code=TGT
Target Corporate. (2017). Retrieved 24 May 2017, from https://pressroom.target.com/corporate
Target Corporation Settles Racial Discrimination Lawsuit. (2007). Law in life Website. Retrieved 24 May 2017 from, https://lawinlife.wordpress.com/2007/01/27/target-corporation-settles-racial-discrimination-lawsuit/
Thomas, L. (2017). Target shows progress, but turnaround still has a way to go. CNBC. Retrieved 24 May 2017, from https://www.cnbc.com/2017/05/17/target-reports-first-quarter-earnings.html
Tuttle, B. (2016). 5 Reasons Why Fewer People Are Shopping at Target. Time.com. Retrieved 24 May 2017, from https://time.com/money/4456039/target-shoppers-sales-decline/
Wal-Mart Set to Repeat Share Gains, Grab Target Sales (2017). Bloomberg.com. Retrieved 24 May 2017, from https://www.bloomberg.com/apps/news?sid=aX.YXT2sDwl&pid=newsarchive
Wal-Mart U.S. accelerates small store growth. (2017). Corporate.walmart.com. Retrieved 24 May 2017, from https://corporate.walmart.com/_news_/news-archive/2014/02/20/walmart-us-accelerates-small-store-growth
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