Target is turning to the more-is-less philosophy as it tries to persuade today’s cost-conscious consumers that it can compete with the big warehouse stores on stock-up deals.
Glen Stubbe, Star Tribune
Target shifts to warehouse approach
- Article by: JACKIE CROSBY
- Star Tribune
- January 4, 2010 - 10:33 PM
With consumers focused more on the price of toothpaste than buying a new bedroom lamp, Target has gone warehouse.
In a part of the store normally used for seasonal merchandise, the retailer has stacked hulking packages of bottled water and paper towels on pallets. Shelves are lined with supersize jugs of laundry detergent and bulk-size packages of batteries. Shoppers can dig through bins of $1 neon-colored flip flops and packs of athletic socks for $7.
The seven-week promotion, "The Great Save," started showing up in stores over the weekend. It is one of the Minneapolis-based retailer's boldest moves yet to signal to recession-battered consumers that Target can deliver deals alongside trendy fashion.
Warehouse clubs such as Costco and Sam's Club, which is operated by Wal-Mart Stores Inc., have won the hearts and wallets of many shoppers during the past year of belt-tightening. Target's profits have plunged during the recession as it has struggled to persuade shoppers that its prices on the same items are within pennies of Wal-Mart's. During the holidays, it aggressively matched Wal-Mart and Amazon on popular toys and books.
"The idea is to create the fun, convenience and treasure-hunt feeling of a warehouse environment within your local Target store -- without the membership fees," said spokesman Joshua Thomas.
Target said it will add limited-time-only items to its "Great Save" promotion that aren't normally found in stores, including Samsonite luggage, Calvin Klein T-shirts and Ed Hardy handbags. For the past five years, Target has used that space as its "Global Bazaar," with home decor items with an international theme -- the last thing today's practical-minded consumers want.
"This promotion is a lot more correct for the time, given the economy and consumer psychology," said Stan Pohmer, a Twin Cities retail consultant and former Target buyer. "They have that space that they're converting from toy and seasonal, so they might as well generate some incremental sales." Jackie Crosby • 612-673-7335
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