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Target Corporation By: Leigh Blackmon, Justin Napier, Sara Ratliff, and Brian Roundtree

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Page 1: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Target Corporation

By: Leigh Blackmon, Justin Napier, Sara Ratliff, and Brian

Roundtree

Page 2: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Executive Summary

The FirmUpscale discount chain that offers trendy

merchandise at affordable prices The Industry

Dominant Firms – Wal-Mart, Costco, K-MartKeys to Success- Marketing, Promotion, Brand

Loyalty, Differentiation

Page 3: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Mission Statement

At Target, our mission is to create a loyal customer base by selling a trendy, yet affordable range of merchandise. We are also interested in being socially responsible and do not define the success of our company simply by the bottom line. We are committed to the social, economic, and environmental welfare of all communities. Finally, it is our mission to encompass quality, style, and trend into all aspects of our corporation to ensure customer satisfaction.

Page 4: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

External Environment

EconomicCustomer’s amount of disposable incomeCustomer’s propensity to spend

SocialAge of customersBeliefs of customers

TechnologicalTechnological forecastingGiving customers the ability to shop from the comfort of

their own home

Page 5: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Ranking of Porter’s Five Forces

Present- 1) Substitutes2) Rivalry3) Powerful Buyers4) Powerful Suppliers5) Threat of Entry

1= Most Important, 5= Least Important

Page 6: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Suppliers

No similar companiesEx. 1-Including

purchase volumeEx. 2-Including

differentiation of inputs

Wal-Mart, K-Mart, and Costco

Need more product differentiation

Increase buyer volume

Establish brand identity

Providing quality and performance in each store

Buyers

Page 7: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Threat of Entry

Difficult to establish large companiesHard to imitate brand identityLarge capital requirements

Page 8: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Substitutes

None- Due to quality and fashion

Results in customer loyalty

Results in brand identity

Wal-MartK-MartCostcoDifferentiation is key

factor= FashionPush Target’s brand

identity

Rivalry

Page 9: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Company Profile

Primary ActivitiesCustomer ServiceMarketing and Sales

Advertising, promotions, market research, planningOperations

Production and Quality Assurance

Page 10: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Company Profile

Secondary ActivitiesHuman Resources

Recruitment, hiring, training, and developmentTechnology

Conduct researchNew trends and interests

Page 11: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Company Profile

StrengthsLoyal customer baseReadily available productsConstantly produces new ideas and exclusive

products

Page 12: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Company Profile

WeaknessesHigher prices than Wal-Mart

Population response to the economyNot a global retailer

Other companies, such as Wal-Mart, are gaining a competitive advantage

Not all stores are SuperTargetsCustomers want a one-stop store

Page 13: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Financial Analysis - Revenue

Target2001: $32.5 billion 2005: $51.2 billion

Costco2001: $34.1 billion 2005: $51.8 billion

Wal-Mart2001: $180.7 billion 2005: $285.2 billion

Page 14: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Revenue

Revenue

$0 $50 $100 $150 $200 $250 $300

2001

2002

2003

2004

2005

Year

Amount (in billions)

Wal-mart

Costco

Target

Page 15: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Financial Analysis – Net Income

Target2001: $1.1 billion 2005: $2.4 billion

Costco2001: $0.6 billion 2005: $1.06 billion

Wal-Mart2001: $6.2 billion 2005: $10.2 billion

Page 16: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Net Income

Net Income

$0 $2 $4 $6 $8 $10 $12

2001

2002

2003

2004

2005

Year

Amount (in billions)

Wal-mart

Costco

Target

Page 17: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Profitability

0%1%1%2%2%3%

3%4%4%5%5%

2001 2002 2003 2004 2005

Year

Prof

it M

argi

n

Target

Costco

Wal-mart

Page 18: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Asset Turnover

0

1

2

3

4

5

6

7

8

9

2001 2002 2003 2004 2005

Year

Turn

over Target

Costco

Wal-Mart

Page 19: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Firm’s Position / Core Issue

Core IssueCompetition with Wal-Mart

Target has one-fifth the sales of Wal-Mart

Firm’s PositionBased on more than just pricingStrive to encompass style, quality, and trend

Page 20: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Long Term Objectives

Increasing Market ShareAchievable and Measurable

ScenariosBest Case: Wal-Mart going out of business and

Target having a significant share of marketWorst Case: Target going out of business Most Likely: Wal-Mart maintains market share

and Target’s profit margin, sales, and net income will continually increase

Page 21: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Corporate Level Strategy

GrowthInternational Expansion

Create more competitive advantageIncrease market share

Page 22: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Business Level Strategy

Strategic Business UnitTarget Food Centers, Target Pharmacy, Target

Retail MerchandiseGeneric Strategies

DifferentiationFocus

Grand StrategiesInnovationProduct Development

Page 23: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Strategic Choice

DifferentiationHigher quality, more trendy clothing, better styleDrive-through PharmaciesExpansion into SuperTargets

Page 24: Target Corporation - People Search Directoryfaculty.winthrop.edu/robbinsk/MGMT 480/Target 11.00... · PPT file · Web view2008-04-02 · Target Corporation By: Leigh Blackmon, Justin

Any Questions?