Target.com!

An Analysis of ecommerce operations and a brief assessment of Target’s “Designer Campaign”!

The Essence of !

Target considers itself to be an upscale discounter that provides high-quality, on-trend merchandise at attractive prices in clean, spacious and guest-friendly stores. In addition, Target operates the online subsidiary, Target.com.!

"Target stores tend to attract younger and more educated and a#uent customers than its competitors like Walmart; as a result, it is often referred to in a tongue-and-cheek manner as Tarjey.!

Mission Statement!

Background and current State of Target Corporation’s Target.com!

An American retailing company founded in 1902, Target is the second largest discount retailer in the United States.!

Target Corp owns and overseas the company’s ecommerce initiatives under the Target.com domain, founded in 2000 as Target.direct. !

Eager to build out their online presence with as little damage to their brand as possible, Target contracted a third-party operator, Amazon, in 2002, to last until 2010, in which Amazon.com would provide order fulfillment and guest services for Target’s online customers. !

Indeed, given Amazon's success in online commerce from the very beginning, it was a strategic partnership. !

After Target Corp. sold Marshall Field's and Mervyns in 2004, Target.direct became Target.com. !

The domain target.com attracted at least 288 million visitors annually by 2008 according to a Compete.com survey. !

From books to foods and beverages, apparel, electronics, household goods and other products and services, Target.com continues to maintain its competitive stature by means of the e-marketing strategy. !! !

Online marketing has provided the company with a worldwide presence as more and more people access information derived from the Internet. !

While online marketing is considered to be the most expensive, it is now the most comprehensive marketing strategy within the trend of rapidly growing technology that every company wishes to implement and apply in order to stay competitive. !

Research studies have ascertained that online shopping is perceived to be more time saving than other traditional approaches of shopping by customers and supports the needs of busy working people. !

Target Corp. recognizes this convenience and continuously strives to create innovative marketing solutions to support its online shopping operation. These innovations are always directed to satisfactory, convenient, and customer-oriented service, with goals of achieving e$ciency savings, boosting sales, growing its customer base and increasing customer retention while at the same time improving its brand position in the online market place. !

Target.com is an exceptionally user-friendly web site that enables the customer to navigate and “shop” with ease. In addition, Target.com exhibits an extensive variety of products, equipped with customer reviews and suggestions for the purchase of similar products. The target site is informative, well organized and helpful, providing an e%ortless and enjoyable shopping experience. !"!

The site’s search engine is extremely e%ective. Target.com enables consumers to shop via key word phrases, multiple word phrases, and even correctly displays results for misspelled phrases. In addition, Target displays an extensive selection of products that result from each initial search. When conducting a search for various products, Target.com generates a highly relevant list of results. The majority of items displayed on the first page of search results match the descriptive phrase entered. Moreover, correct results are displayed even for misspelled phrases. !"!

Target enables consumers to shop by brand, price, season, new arrivals, etc. In addition, target recommends certain products that coordinate with the products that consumers are initial browsing.!"!

Target does a great job at merchandising to the online consumer. Target displays seasonal advertisements and special promotions on the home page in an e%ort to entice the consumer with selective merchandise. Similarly, Target.com allocates space for holiday promotions, and special “themed” areas.!"!

The multi-cross channel exhibited by Target is extremely e%ective. Target.com does a very good job coordinating online merchandise. Additionally, Target enables the viewer to shop weekly catalogs and “daily deals” by both online and in store channels of distribution.!"!

Target does an adequate job at “cross selling” products. Target enables the consumer to view products that are similar to the product that is already being viewed.!

How could we make Target.com more dynamic?!

•! Introduce pre-order/monthly reorder capabilities !

•! Online Sweepstakes/Contests to gather customer contact information for future marketing e%orts!

•! Gift with online purchase/Buy one get one free!

•! Buy more-Save more$ or % o% of future purchase. This feature would act as an

incentive for shoppers to revisit Target.com !

•! Free Shipping: Target.com currently o%ers free shipping on limited merchandise. This parameter could be extended to include all or most products purchased online !

•! Free returns: provide pre-paid return shipping labels in all order shipments!

•! Product comparisons: Target.com could feature side-by-side reviews with customer selected merchandise controls via a good/better/best format !

•! Informational videos/Audio, podcasts, downloadable PDF’s!

•! Calculators/Interactive Tools: Shopper enters requested information and receives customized advice or a response; interface is often presented as a “wizard”!

•! Product Configurater: Ability to create a customized product using a visual interface !

•! Product Personalization: Ability to customize a product with initials, inscriptions or other text; can include gift card customization!

•! Promoting in-store events: Listing of happenings at retail shown on site/List of retail store “happenings” !

•! Free gift-wrapping!

•! E-gift announcements: Email sent to gift recipient notifying them that a gift is in route!

•! 3D imaging: 360° product rotation !

•! Shop by outfit: Multiple, coordinating, apparel-related items displayed together that

can be purchased on one page, encouraging higher units per transaction!

•! Color change: such that image changes to color of selected color sample “swatch”, rather than listing di%erent colored products separately !

•! Personalized “shelf”: segmented area containing recommended products that Target.com has chosen for shopper based on preferences!

•! Blog: o%ering commentary or news on a particular subject where users can post comments and rebuttals in a pre-established format to be part of the overall site experience!

•! Community Boards: for users to post comments or photos and interact with other site visitors or with the site’s moderator (i.e. forums, bulletin boards) !

•! Share: enable people to connect and share through social networking sites such as Facebook, twitter etc!

•! Multinational site entry/Ability to shop in another language/International shipping!

•! Onsite order confirmation o%ering additional products or services!

•! Real-time, click-to-chat and click-to-call!

The Target Customer!

•!Target shoppers have a median age of 41 - the youngest among major retailers.&

•!The median household income of Target guests is $55,000.!

" !

•! Fifty-one percent of Target shoppers have completed college. More than half of Target customers are employed in professional or other managerial positions.&

•!Between roughly ninety percent of Target shoppers are female. &

•!Thirty-three percent have children at home - or in a red shopping cart with them. This figure is consistently greater than any other discount store's customer profile.&

•!Target customers are careful about how they spend and where they shop. They know that any retailer can match price, but what about value? Target shoppers strive to make the most of their time and money by recognizing the di%erence between price and the more enduring concept of value. They are people who like the idea that Target is the only place where they can find competitive prices and value in addition to selection.!

The Target Customer (con’t)!

•! Target customers are smart about their purchases, savvy to trends and conscientious about their communities.!

•! Target also reaches out to multicultural customers by designing inspiring and culturally relevant marketing campaigns. By advertising multicultural beauty products in Essence and Latina magazines, sponsoring "Target Presenta Nuestra Navidad," a holiday musical celebration on Univision, o%ering a surprising selection of ethnic food choices on the grocery shelves of SuperTarget stores, and a variety of Latin and urban music, Target strives to find innovative ways to connect with the communities it serves!

Market Segments: “Suburban Mom”!

•! Reasoning: Target stores are mainly placed in residential areas. Also, the overall theme of Cheap chic is appealing to this demographic. "Style and quality at lower prices".!

•! Ages 28-45!

•! Female!

•! Upper middle class!

•! Lives in Suburbia!

•! Often a stay at home mother, housewife or only works part time!

•! Health conscious: visits gym on regular basis, ensures that family eats healthy, balanced meals!

•! Likes to shop!

•! Concerned with appearance and social status!

•! Does not like to shop at stores notoriously known as "discount super stores”!

•! Likes to buy quality goods at lower prices!

•! Trend savvy/ fashion conscious!

•! Typically have children (younger than teenagers)!

•! Well educated!

•! Acts as "socialite" for family (coordinates family events, and the attending of functions)!

•! Has little time to "shop"; attempts to multi-task and buy numerous items in one place!

•! Drives SUV to accommodate family!

•! Cooks and cleans for family on daily basis!

•! Involved in children's activities and local philanthropic leagues!

Market Segments: “Single Working Mom”!

•! Reasoning: Target stores are accessible to a wide demographic, including rural, and in this case urban, customers of many socio-economic classes. Neither customer one, nor two has significant time to devote to shopping. It is convenient, one-stop shopping that provides great value.!

•! Ages 28-45!

•! Female!

•! Lower-middle class!

•! Lives in an apartment in the city, with mother and 6 year-old daughter!

•! Works as a receptionist full time, while taking online courses to complete a degree in Occupational Therapy!

•! Does not have much free time for shopping!

•! Is very close with family!

•! Is religious/spiritual!

•! Is involved with the Latin Community!

•! When she does shop, it is mainly at big box retailers, discount stores, and chains (e.g., Loehmann's, the Gap, Costco)!

•! Is more concerned with value, than being on trend, but tries to make an e%ort to appear stylish/fashionable."!

•! Does not own a vehicle; relies on public transportation!

•! ” Brown-bags" and cooks at home, does her own cleaning!

•! Friends with other mom's in the building, with whom she arranges play-dates; also serves as her time for socializing (e.g., taking children to park with other mom's on the weekend)."!

How can Target Corp better understand and serve Target.com consumers?!

•! Design and implement customer surveys that will enable the company to better understand the wants and needs of consumers. !

•! Target will ask consumers questions that not only pertain to their demographics, but also psychographics (including, interests, hobbies, etc.)!

Consumer Survey!

•! I. What is your sex?"!

! Male "Female!

"!

•! II. How would you classify yourself?!

"!

•! Caucasian!

•! African American!

•! Hispanic!

•! Asian!

•! Indigenous or Aboriginal Person!

•! Multiracial!

•! Other!

"!

•! III. What is your marital Status?!

"!

•! Married!

•! Divorced!

•! Living with another!

•! Separated!

•! Single!

•! Widowed!

•! IV. Please indicate your current household income before U.S. tax dollar!

"!

•! Under 10,000!

•! $10,000 to $19,999!

•! $20,000 to $29,999!

•! $30, 000 to $39,999!

•! $40,000 to $49,999!

•! $50,000 to $79,999!

•! $80,000 to $100,000!

•! $100,000 to $150,000!

•! Over $150,000!

"!

•! V. What is your age?!

"!

•! Under 20!

•! 20-30!

•! 30-40!

•! 40-50!

•! 50-60!

•! 60-70!

•! 70-80!

•! Over 80!

•! VI. Where is your home of residence?!

"!

A) Suburbia!

B) Urban!

C) Slightly outside the suburbs!

D) Rural areas!

"!

•! VII. Do you prefer to shop?!

"!

A) Primarily in stores (physically at a store location)!

B) Primarily on-line!

C) Both!

"!

"!

•! VIII. What is the main reason that you shop at Target?!

A)" Convenience!

B) " Reasonable Prices!

C) " Product Selection!

D) " Customer Service!

E) " All of the Above!

F) " Other (please specify)!

Survey Participation!

•! Once people have decided to take our survey, they will likely want to get started. When the link provided in the e-mail is clicked, they will be directed to a landing page on Target.com that is simple - it will let people take the survey right away! Some additional information about the survey will be provided on this page, including the length of time required to complete it, exactly what we are o%ering to participants, as well as what the information will be used for and a guarantee of anonymity. It will be succinct because studies show that most people don't read extensive instructions.!

"!

•! Although fancy graphics can sometimes distract from the content of the survey, or influence answers, they can be used to improve survey responses if used appropriately. The landing page (which is also the survey page) will feature graphics of our incentive - images of gift cards from each of the retailers/a$liates we are participating with, including our own.!

"!

•! Studies show that a small token, gift certificate, etc., can increase responses considerably, but that incentives need not be large. To encourage participation in the survey, we will o%er $10 gift cards that are valid both online and in-store, and can be used at specific a$liates, including Target stores, Jamba Juice and Starbucks (which already have joint ventures with Target), Amazon (which is currently listed as an a$liate on Target.com), as well as iTunes and AMC theaters with whom we could negotiate a partnership. These companies have been chosen based on the belief that some, if not all of them, will appeal to our target market - families of various ethnic backgrounds, with children living at home.!

Target’s Social Media Community: User Generated Content!

•! That Target currently has 547, 842 Facebook fans demonstrates the value of this platform for reaching our consumers. Earlier this year, Target was highly praised for the success of its "giving"7 campaign, which let fans determine which of ten national charities, one of their weekly donations should go to. This campaign ran on Facebook for a 16-week period, at the end of which Target had donated a total of $3 million dollars.

•! The company received high praises for cultivating a Facebook community that gave fans the ability to have a say. Giving, after all, is a vital element of social media. Not only did the Bullseye Gives campaign let people know that Target gives money to charity, but it also let people have an influence. Influence is of great significance of web 2.0 users, and is a pillar of online communities.!

Next Steps: Suggested Social Media and interactive online initiatives!

Given the success of the User Generated Content community on Facebook for Bullseye Gives and the importance of establishing a "home base" on the native site in order to best brand and maintain the company's image and vision, Target will establish a User Generated Content community directly on the Target.com homepage. The community will be comprised of several executable social media ideas each with their own goals and strategies that will benefit Target as well as its consumers:!

1.! Goal: to utilize Target’s o$cial Facebook page data capture that will ultimately benefit consumers !

Strategy: To make the most of Target's presence on Facebook, a link to

the survey will be available on Target's o$cial Facebook page, as well as on the general promotions page of Facebook itself. To foster interactivity, the discussion forum will have a thread for feedback and comments related to the survey. "Although the sponsored page will feature banner Ads for our a$liates, Starbucks, Jamba Juice, Amazon,

iTunes, and AMC theaters, it will not have discounts or promotions other than for the survey, bearing in mind that Facebook is a social environment where Target will talk to people first, before trying to sell anything. !

2. Goal: To involve consumers in the Designer Collaborations program with intent to increase sales of limited-run designer collaboration merchandise. Designer Collaborations is an expansion of Target's existing designer fashion program and each collection is available only for a limited time. Designer Collaborations is a unique program that features well-established designers. It is an exciting way of delivering the latest styles to fashionable and contemporary guests at the prices they expect from Target. """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" !

Strategy: Online community members have the opportunity to vote from a list of 5 possible candidates for Target's next designer collaboration. ( Designer Candidates ).!

3. Goal: To promote and increase sales of Target's sustainable/eco-friendly products. Target strives to be a responsible steward of the environment, complying with all environmental regulations, seeking to understand and evaluate Target's carbon footprint and continuously improving on business practices in a variety areas."Consumers who are looking for simple and a%ordable ways to respect the planet turn to Target, which o%ers a wide array of natural, organic, and eco-friendly products that have a reduced impact on the environment. From fashion and beauty to household cleaners and groceries, nearly every department o%ers ways for guests to make smart, environmentally considerate choices.""""""""""" """"""""""" """"""""""" """"""""""" "!

Strategy : Eco-friendly iniative whereby, in collaboration with Flicker.com, community members can post and share photos of themselves using Target's eco-friendly products. For each photo posted, members will be entered into a monthly draw to win a $50 Target Gift Card. (Shop Target's eco-friendly products )""!

4. Goal: To promote Target's Athletic Sponsorships. Target sponsors some of today's top professional action sports athletes, including snowboarder and skateboarder Shaun White, freestyle motocross rider Nate Adams, freeride mountain biker Alex Prochazka, freeskiier Simon Dumont, motocross rider Ryan Dungey, surfer Carissa Moore,"and BMX athletes Mat Ho%man and Kevin Robinson. """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" "!

Strategy : A portion of the proceeds from the sale of "Our Athletes' favorite products" will go directly to their sponsorship campaigns. Community members can watch videos of sponsored athletes as they train and compete in national and world events. The athletes will also share and update their favorite Target products, and members can ask and get answers to questions from the athletes themselves! (e.g., Carissa'' s favorite products , Ask Carissa , Watch Carissa )!

5. Goal: To gain insight directly from the Target community on an on-going basis about what products members would like to see online or in Target stores, as well as their satisfaction with existing products. Target endeavors to deliver on its brand promise of "Eat Well. Pay Less." by o%ering the ultimate one-stop shopping destination that will satisfy each and every customer."At great, low prices, Target o%ers a full-service grocery store, including delicious foods from an in-store bakery and deli, along with a wide selection of unique grocery items that complement the hip and fashionable merchandise found at a typical Target store.!

"""""""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" """"""""""" "!

Strategy: Target will host a discussion forum for ratings, reviews, comments and suggestions, where members can share their ideas with the community about products they would like to see made available at Target, and communicate their experiences with existing merchandise.!

Designer Collaborations !

Target is now famous for its "design for all" playbook, drawing bevies of well-heeled consumers into the big-box store in search of limited-run designer collaborations. Target launched its Designer Collaboration program In March of 2009, bringing a series of established designers to the masses at low prices. The program is estimated to do more than $100 million in annual sales. It is geared toward Target's trend-minded guests who are always on the hunt for the newest and hottest looks at an a%ordable price; Designer Collaborations is another way in which Target brings an emporium of designers to its guests!

Within the current economic climate, consumers are in search of quality products at lower prices. This is especially true in the fashion industry. At this point in time, it seems that trendier clothing at low prices is very "in vogue". Target is a wonderful retailer for quality clothing at extremely reasonable prices. In fact, Target is well known for its many partnerships with designers o%ering comparative styles at the price of a budget retailer.!

Suggested collaboration + new media promotion!

•! In an e%ort to promote Designer Collaborations, Target will collaborate with Emilio Pucci to execute a promotional campaign that features a line of brilliantly colored apparel for the everyday consumer. The collection will uphold the design characteristics, fabric patterns, and overall brand image of the Emilio Pucci Fashion House.!

•! The Emilio Pucci for Target collection will be supported by an online video advertising strategy designed to drive buzz and tra$c via experiential marketing that is distributed across the Internet as well as e-mail. !

"!

•! The Pucci name is synonymous with geometric prints in a kaleidoscope of colours. The video promotion will feature pieces from collection, which will uphold the design characteristics, fabric patterns, and overall brand image of the Emilio Pucci Fashion House. An e-mail with the subject line "Emilio Pucci for Target Sneak Peek: A kaleidoscope of color at low prices" will be distributed and will be embedded with a youtube video promotion. The youtube video will also be tweeted and be viewable on both Target.com as well as Target's o$cial Facebook page, as a supplement to a special Facebook promotional event whereby fans can register for an "on-line" drawing for the chance to win one of four ensembles from the Emilio Pucci for Target Collection!

Youtube Pucci for Target promo: !

http://www.youtube.com/watch?v=Rn9AGcxpCMw!

Target Consumer!

The target market for the promotion will be fashion savvy young women (ages 20-30) that want quality clothing at reasonable prices.!

Goal!

To bring designer clothing collections to consumers at reasonable price points.!

Product Line!

•! The various designer collections will include full product lines of apparel, shoes, and accessories.!

•! Each season, Target will release a series of new designer collaborations that coincide with current fashion and runway trends. !

Marketing Campaign!

The advertising strategy will be roadblock advertising. This

strategy will deem to be an effective tactic for gaining user attention. The campaign that will promote the new Emilio

Pucci for Target collection will be over a time period of two days. The first day will lead up to the product launch, and the

second day will be the first week that the product line is

available in Target Stores. This strategy should be effective due to the fact that Target will own 100% of the given voice

for the given time period. The short, yet affective campaign will work to deliver a rich and powerful media advertising

experience.

Media Buys!

•! :60, :90 and 2:00 buys on TV!

•! Streaming online Video!

•! Video e-mails targeted by zip code in select urban markets!

•! Online ads linking to Target.com!various social websites

Online Advertising!

•! WWD

•! Who What Wear

•! shopstyle.com

•! Facebook: Target will have a special "promotional event" on their facebook fan page. Fans will be able to register for an "on-line" drawing in which they have the chance to win one of 4 various ensembles from the Emilio Pucci for Target Collection.

Print Advertising!

•! Various Fashion magazines: Lucky, Teen Vogue, Allure, Glamour!

•! Major newspapers (USA Today, New York Times)!

•! Womens Wear Daily!

•! Designer collaborations will be advertised on television networks whose viewership is in line with the consumer profiles for this product category at Target. !

•! Example:!

Television Advertising!

Designer Collaborations Marketing Strategies !

January:!

The idea behind the “Design for All” collaboration concept is to provide universally accessible products that in the past have only been obtainable for wealthier market segments. To market the “expect more, pay less” philosophy further, a designer collaboration line could still be introduced to the mix that caters to the lowest end of Target shoppers’ income brackets. This could be particularly viable in the current economic environment, as income levels have been dropping. In order to determine the media buys that would have the greatest scope, it is necessary to consider what this market segment primarily uses the Internet for. Considering that anyone with Internet access can and generally does create an e-mail account (for free), an e-mail server such as Hotmail would be likely to reach a significant portion of this market segment. !

+!

June (father’s day):!

The majority of Target.com’s regular shoppers are female, meaning that the potential to increase male market capture is great. Beginning in the new year, Target will launch a new designer collaboration exclusively for male consumers. Media buys for this men’s line may include banners on male-dominated websites such as AskMen.com. AskMen has both Facebook and Twitter accounts which could be utilized to incorporate a social media component beyond Target’s own social media outlets.!

+!

August (back-to-school): !

The median age of the Target shopper is 41 years. However, Target is perceived and positioned as a trendy, hip place to shop for younger generations as well. With this in mind, a collaboration line with a younger designer could prove very successful in appealing to the younger Target demographic. Media buys for this line might include a 30 second video promotion that would run before streaming videos on MTV.com.!

+!

April:!

Target now has an online baby registry for expecting parents. Target might choose to focus its promotional e%orts towards this market with the launch of a designer baby boutique. Parents who register for their baby shower at Target.com could be entered into a shopping spree sweepstake and entitled to a complimentary welcome package for the newborn that would include items from the designer baby collection and promotional coupons, in addition to other baby merchandise (baby wipes, diapers, a blanket, etc.). Target.com already collaborates with Parents Magazine to produce a web-based baby resource on Target’s own website where parents can find information on parenting and child related topics. Target also advertises on the Parents Magazine website which would be an appropriate media buy to promote the designer baby line. !

+!

Budget!

Total Event Costs!

•! $120,000 !

Total E-mail Lists!

•! $20,000 !

Total E-mail Campaigns!

•! $30,000 !

Total On-line Ads!

•! $120,000 !

Total Banner Ads!

•! $55,000 !

Total Magazine!

•! $25,000 !

Total Digital Media (Movie/Video Stream)!

•! $120,000 !

Total Direct Mail !

•! $5,000 !

Total Research (Questionnaire)!

•! $5,000 !

Total Budget!$500,000 !

Measurement: Analysis!

•! Response to e-mail invitations!

•! New email/newletter sign-ups!

•! Response to live events!

•! Response of visits to web sites from various media channels !

•! Merchandise sell-through online & in store!

•! Sharing of data acquired!

•! ComScore evaluation of Target’s Facebook/Twitter accounts !