Strategy

What's so great about Target?

Attitude and shopping experience set American retailer apart from Canadian competitors.

See also “7 things you need to know about Target”

Canadian shoppers still consider Target one of the few American retailers that still merits crossing the border. So when Target announced its $2-billion deal with HBC that will allow it to not only control all 200 Zellers stores across the country, but also turn about half of them into Target brand stores within the next two or three years, there were audible cheers from north of the border.

The question is why? What does Target have to offer Canadians that they can’t already scoop up at the local Walmart, Canadian Tire, or Loblaw Superstore?

The answer is found not in the products on the shelves so much as the shopping attitude the Minnesota-based Target Corporation has masterfully manufactured. Many discount retail outlets like Zellers are dumps, Howard Davidowitz of New York-based consulting firm Davidowitz & Associates Inc., told the Globe and Mail.

‘Everything is all messed up, they never got it right, they never knew what they were,’ Davidowitz says. ‘Target knows what they are, and they execute beautifully.’

After customers shop at one of the 1,752 Target stores in the U.S., they don’t have to hide their shopping bags from the neighbors, or frantically rip off the price tags so friends won’t know they’ve been frugal. Instead, Target shoppers laugh with fellow soccer moms about how wonderfully cheap the products they purchased are, and they’re proud of nabbing the fun, of-the-moment merchandise without the high cost usually associated with being on trend. Shopping at Zellers is about necessity. Shopping at Target is about taking pride in the simple delights of middle class life.

A lot of this cheerful attitude comes from Target’s advertising that shows customers how glamorous the Target life is. Target also puts a focus on having the most current colours and patterns when it comes to bedding, home accessories and furniture. This attracts customers by appealing to their sense of individuality, rather than by trying to play it safe with simple patterns and colours that many will find merely tolerable.

In the past 10 years, Target has doubled its sales and profits. That’s allowed the chain to continue to send representatives to scour the world for stylish items it can ‘Targetize’ for the American masses. Chairman and CEO Gregg Steinhafel says Target will invest over a billion dollars revitalizing Zellers locations in Canada and bringing this vision in.

Target succeeds in promoting its family and community-friendly image where Walmart has fallen flat. For all of Walmart’s go-green chutzpah, the brand is still followed by the image that it’s a cold, unfeeling small-business killer. Target makes a big show of its community outreach programs — which it plans to bring to Canada too — where 5% of earnings have been redistributed into the community since 1962. Of course, Walmart has an often forgotten Walmart Foundation, which also provides community outreach funding. But no amount of community contribution is specified, and the marketing around the program has been lackluster.

When it comes to fashion there’s very little that separates Target’s Isaac Mizrahi affordable fashion from Joe Fresh at Loblaw or the George line at Walmart. All are cheap, and relatively chic. But since Target was founded as a department store (it was called Dayton’s department store in 1911), it’s always had a focus on its fashion line. Socially, it’s more acceptable to be seen with a cute top from Target. Plus, the shopping experience is greatly improved. Target puts a strong focus on the experience of browsing through the fashions. The store isn’t trying to up-sell customers on discount batteries piled in bins next to the racks. Neither does the scent of fresh produce waft through the wares. And while the lighting may not be much better than its competitors, Target’s use of bright, seasonal colours breathes life into the merchandise better than the beige malaise that often envelops Zellers products.

But perhaps the greatest contrast to Target stores is Canadian Tire. While Target knows exactly who its customers are, and what kind of modern, clean and affordable home outfitting they desire, Canadian Tire seems to be floundering trying to decide if it wants to sell you a bookshelf, a toaster oven, or a band saw. And while the scent of car oil and paint is fine if you need an extension cord, it’s not conducive to selecting a Zen-themed bathmat and shower curtain.

Because Target knows how to speak to its customers, other Canadian retailers may be forced to bring that same focus to their stores if they hope to thrive.