Marketing Report for Target - Essay Example

As of 2009, Target has employed 351,000 full-time partners, all of which are described as “fast, fun, and friendly.”Chairman, President, and CEO, Gregg Steinhafel, looks to make Target the “Best Company Ever,” and that starts with teamwork-one of the key factors to meeting challenges while having fun at the same time. The diversity, engendered in its team members, allows Target to reach out and serve its guests and communities. Target enlists employees with diverse backgrounds in order for the company and its locations to mirror that of the guests. The pace is fast, the atmosphere is fun and the people are friendly.

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Every team member-from stores to Distribution Centers to corporate offices-is empowered and encouraged to innovate, contribute ideas and discover solutions. People at Target are respected and recognized for their work and know they are a unique and important part of a world-class team. Team members receive one of the best pay and benefits package in retail, including competitive pay, insurance coverage, plus other perks and benefits. With over 1600 stores in the U.S., including office sites around the world, career opportunities can be found almost everywhere.

Community Outreach

Target fosters community giving through a variety of programs to help strengthen the communities it serves and donates 5% of its income to communities – roughly $3 million dollars a week. Target has formed national partnerships with United Way, American Red Cross, St. Jude Children’s Research Hospital, Target House, United Negro College Fund and the Hispanic Scholarship Fund. In addition, Target Corporation donated over 350,000 volunteer service hours to approximately 7,000 projects nationwide in 2003.

Education

Take Charge of Education (TCOE) helps improve funding for schools and education programs through the Target Visa and Target Guest Card (Target REDcard). REDcard purchases are then tracked and Target donates 1% of a guest’s purchase made with these credit cards to the school of their choice. Target has donated more than $273 million since 1997 thanks to this program. Target also sponsors “Ready. Sit. Read!” a program that encourages early childhood reading through book festivals and reading contests. With the partnership of Tiger Woods, Target co-sponsors “Start Something,” a dream-building program for youths that helps them define and achieve goals and dreams (www.target.com).

Arts + Culture

Target sponsors over $3 million a week to local communities for programs, exhibits, and performances that make artistic and cultural experiences more visible and accessible to families. The company sponsors free and reduced-admission tickets in museums, as well. Through store grants, Target also provides art supplies to local schools

Social Services

To strengthen the communities they serve, Target is dedicated to providing basic needs to families in crisis, supporting disaster relief efforts, and preventing family violence. Target House provides families with housing, as they seek treatment for their critically ill children. Target also supports the American Red Cross, the Salvation Army, Feeding America, and the United Way.

Products & Services

The company offers an assortment of general merchandise, including consumables and commodities; electronics, entertainment, sporting goods, and toys; apparel and accessories; and home furnishings and decor, as well as food items under private label brands. It also offers merchandise through programs, such as ClearRx, GO International, and Home Design Event. The company also provides merchandiseunder licensed brands comprising of: Converse One Star, Eddie Bauer, Genuine Kids by Osh Kosh, and Kitchen Essentials by Calphalon, just to name a few.

In-store amenities include Food Avenue, Target Clinic, Target Pharmacy, and Target Photo; leased or licensed departments include Target Optical, Pizza, Portrait Studio, and Starbucks. Target Corporation also provides credit to qualified guests through its REDcards, Target-branded proprietary credit cards-Target(r) Visa(r) Credit Card, Target Credit CardSM, and Target Check CardSM. Target’s popular GiftCards are also sold year-round, in set amounts of $5-2000.

Macro Environmental Analysis Economical

One of the most visibly prominent factors affected the Target has been the crisis that hit the American economy in 2007, spilling into 2008. The credit crunch and increasing unemployment rates has left consumers with less disposable income, creating a greater dependence on credit cards. Bad debt expense grew from $481 million with annualized rated of 6.61% in 2007 to $1.251 billion with annualized rated of 14.4% in 2008, primarily due to REDcard payment defaults or personal bankruptcy.Many retailers, including Target, are using stricter credit guidelines as reassurance of getting their money returned.

With the holiday season approaching, Target is hoping Black Friday deals and Internet sales will pump up 2009 sales overall. The recession has also made customers more reluctant to spend on excessive items, such as clothing and accessories compared to food and fuel. Interestingly enough, Target’s Annual 2008 Reports shows that revenue increased from 2007 to 2008, but profit margin decreased from 4.50% to 3.41% from 2007 to 2008. During this time period, Target introduced the Target Visa card, which charges rates at about 20% higher than other REDcards, increasing the receivables balance since it allows cardholders to charge outside of Target stores.

Technological

With the use of Target’s website, www.Target.com, consumers have a wider range of products to select from, compared to that of any Target store location. Customers can now create, manage, or view baby and wedding registries from the web, as well as their Target REDcard. Gift items and gift cards can also be ordered and delivered to recipients. Other technological advancements that directly influence prospective sales pertain to the emergence of the iPhone, smartphones devices, and on-the-go telecommunication devices that enable one to access the store’s site.

Demographical The median age of a Target shopper is 42 years. Median household income ranges at around $60,000 a year, and more than half of its customers, approximately 51% of them, have graduated from college. 33% of these households consist of families with children (www.Target.com). Moreover, most of these households are concentrated in metropolitan and suburban areas. Its largest sales per capita group, spending $300 or more, is identified within the states of Colorado, Minnesota, and North Dakota. The second largest, spending $201-300, identifies with Arizona, California, Florida, Illinois, Iowa, Kansas, Maryland, Montana, Nebraska, New Hampshire, New Jersey, Texas, and Virginia (please refer to Appendix for illustration).

Although these demographics seemingly label the typical Target shopper, the corporation recognizes diversity throughout every aspect of its operations; it therefore participates in multicultural marketing. Multicultural beauty products are featured in Essence magazine, a predominantly African y American magazine, and in Latina magazines. Target also recognizes the Latino community through “Target Presenta Nuestra Navidad,” a holiday musical celebration featured on Univision (www.target.com).

Political

In spite of vigorous competition within the marketplace, Target adheres to antitrust and related laws, requiring businesses to make their commercial decisions independently without the collaboration of their competitors; employees may not disclose prices, margins, markdowns, merchandise selection, promotional plans, or other purchase terms and conditions. Transparency and regular communication with suppliers allows Target to provide the best products and information for its guests.

In strict compliance with all federal, state and local environmental protection law, Target only purchases products that adhere to laws, regulations, standards and orders of the United States (e.g., U.S. Customs Service), or any state or local government; this includes all of its international operations. The United States and a number of international authorities periodically impose restrictions on trade dealings with certain entities and individuals based on their involvement or sponsorship of terrorism, arms proliferation or drug trafficking. Target strictly follows these restrictions along with U.S. Anti-Boycott Act. Target strictly prohibits any payments to any government official, either directly or through any intermediary, for the purpose of obtaining any improper business advantage.