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Brain Cornell
Chairman & Chief Executive Officer, Target
Mikel Chertudi
Director of Corporate Communications, Target
Group #4
Omar A. Aparicio
Peyton Hitchcock
Abby Krulisky
Patrick McKenna
Jeb Tompkins
Eddie Zuhric
1
Table of Contents
Executive Summary……………………………………………………………………………….2
Introduction………………………………………………………………………………………..3
Situation…………………………………………………………………………………………...3
Stakeholder Recommendations…………………………………………………………………...5
Communication Plan………………………………………………………………………………7
Conclusion………………………………………………………………………………………...9
2
Executive Summary
Throughout the last seven weeks my team has been interns of the communications team for
Target. We have been working on analyzing our communications to our key stakeholders and
how there may be disconnects and holes in what we are saying and what is happening. We
happened to find an issue but also an opportunity where Target can capitalize on an opening of
the toy market due to Toys “R” Us’ recent closing. We need to communicate to our guests that
we are a full and legitimate toy store same; and what we offer in comparison to other retailers
that could make us the preferred toy stop for our guest.
We identified three key stakeholders’ groups that we have prepared personalized communication
recommendations that we believe will likely bridge the gap in our communications. The three
key stakeholders that we are focusing on are our guest, shareholders, and our competitors. For
our most important stakeholder group, the guests, we would like to reintroduce days where we
would open up parts of our toy sections for children to come and demo our toys for themselves.
We would advertise this through emails, in-store flyers, and newspaper ads.
For our future guests we would like to advertise all the innovations and conveniences we offer
when shopping with us that they cannot provide. Such as curve side pickup and free two-day
shipping; and we can advertise this through in-store fliers and email blasts. Finally, for our
shareholders, we recommend using press releases that show how much we have invested in our
stores, specifically the toy department and why possible future guests should shop with us.
Overall, we would recommend increasing our in-store signage to engage our guests in buying
more from us.
We have detailed in the next steps portion of this report what we would like to see as our
following steps. In short, we would like to begin as soon as possible to capitalize on the
upcoming quarter four sales which are when the most toy sales occur for all retail outlets. We
have broken down in detail what the cost of running newspaper ads, commercials, and in-store
signage; as well as detailing what order we believe it should proceed with each step. As you will
tell from that portion, our proposition is incredibly aggressive and outgoing, but we think it is
well worth it for the return on investment we will receive not only during the holiday season but
every financial quarter after that. With our current calculations, we perceive that our return on
investment will be a significant 23%.
In conclusion, if we proceed with this aggressive ad campaign our profits will likely increase
drastically for toy sales, secure a large portion of market share, attract thousands of new guests to
us for all their toy needs. We hopefully can steal some potential customers away from our
competitors when they see what we can offer them when they shop with us.
3
Introduction
Target over the last few months has presented with an enormous opportunity to gain an
unprecedented amount of market share for the toy market; due to the recent closing of Toys ’R’
Us. However, there is an issue we are facing, and it is that our competition; specifically Amazon
and Walmart are also trying to capitalize on this market share.
The main problem we face with this is that we are not seen enough by both our current guests
and future guests as a toy store which might make them choose our competition over us. We
have prepared several communication recommendations that will impact our three primary
stakeholder groups and get them to see us as a viable toy store that’s more than good enough to
replace Toy ‘R’ Us. We are confident that if our recommendations are implemented, we will
have great success in capturing the market space.
Situation
Our mission is to make Target the preferred shopping destination in all channels by delivering
outstanding value, continuous innovation and exceptional guest experiences by consistently
fulfilling our ‘Expect More Pay Less’ brand promise. However, many of our current and
potential guests do not see us as a major toy retailer. This enlarges due to our communication gap
between what we are trying to say and advertise and how the public perceives it.
Through our research into Target’s communications with our three key stakeholders we have
found evidence that suggests that we are not seen enough as a toy store. Overall it seems that we
can be doing more to compete in the toy market against our primary competitors; Amazon and
Walmart. This is a significant revelation to us as 182 of the first set of Toys ‘R’ Us locations are
closing; 93% of those are within a 15-minute drive of at least one Target. This is a massive
opportunity for Target to capitalize on the now free 18.7% market share of toys.
A shocking article we found during our research was by CNN Money; in this article, they stated
that Walmart is “killing Target” by increasing digital sales by offering free fast shipping.
Another service they offer is a revamped return policy that makes returns significantly easier.
The bizarre thing is that Walmart is “killing us” yet we offer the same fast, free shipping and a
return policy that is simple too.
Guests
Toys R Us Event’s Effects
4
Before going out of business Toys R Us was known for its inclusiveness for customers and
children. Toys R Us put a priority on creating an environment for customer and children to test
out new purchases or potential purchases. In 2016, Toys R Us held 150 events where over 95%
of their stores participated. Over 335,000 customers reserved a place for these events. Overall
these events increased to over $15 million in sales within a week after the event was held.
Potential Customers
Toys R Us held a large percentage of the toy market, 18.7% in total to be exact. Since their doors
closed on June 29th of this year, that market share is up for grabs. Target wants to capitalize on
the amount of that market share that we can take away from our competitors. Amazon and
Walmart are our main competition in filling the toy gap.
Target has been known for having its name pronounced with a faux French accent. “Tar-jay” is
what made Target different from the Amazons and Walmart's of the world. This is another
internal approach that Target has been taking to bring customers inside its doors. Target has to
“give the consumer a reason to come into [our] store or click on a website, and exclusive brands
are No. 1 in that process... Target's brands so far are doing better than the company thought they
would” (Thomas, 2018).
Shareholders
Ways to increase the number of Shareholders who believe in Target going forward?
As the holiday season quickly approaches, it is imperative that Target starts to roll out the next
versions of their advertisement campaign. Chief Merchandising Officer, Mark Tritton has been
emphasizing this holiday season in particular and states, “We're going bigger, offering guests
thousands of toys, including more than 2,500 new and exclusive items – nearly double compared
to last year” (Henderson, 2018). The fact of the matter is that Target needs to couple their efforts
by promoting their toy selection this season with better communication towards their
shareholders. To ensure our shareholders that Target remains profitable for the foreseeable
future, we recommend that we send out press releases more frequently and also utilize more in-
store signage.
Our recommendations will consist of our three stakeholders: Guests, Potential Guests, and
Shareholders. There will be a variety of communication-based recommendations that will further
enhance the perspective that people have on Target. The sole purpose of this section is to discuss
potential recommendations that we believe will bridge our communication gap that Target can
implement which will take the overall market share away from their competitors and the Toys R
Us shoppers who now need a new place to shop.
Stakeholder Recommendations
Figure 1
Figure 1
Targeted Ad Commercials
Having our highest cost, translate into being a capable platform to communicate to our target. Ad
commercials will broadcast nationally twice per day during prime time, at 8 am and 8 pm. Our
focus is to target as many viewers that have children, before heading to work/school and when
viewers are enjoying their favorite family show. (Kumar and Sharma)
Figure 2
8
This first month will be one of the most aggressive to reach our target market because of our
direct competition.
Figure 4
Conclusion
We need to be aggressive in the upcoming months with the ways we can communicate with our
customers current and future. Right now there is a large part of the market share available with
the closing of the primary competitor which we may be able to obtain many of their customers. It
will be a fight to gain the customers from the other large competitors for the holiday season
arriving fast. However, many people still do not see us as a toy store but with advertising in local
newspapers, television ads, and in-store signage to let the customers know we provide the same
toys and services as our competitors. To help inform the consumers how we are are a toys store
we need to advertise the in-store activities showcasing our toys more openly to bring more guest
to shop with us. This holiday season we will be doubling the number of toys we can offer and by
doing so will increase the profits for the shareholders. We currently offer many of the same
features as our competitors with online shopping and delivery times, but we also provide the
service curb stop, unlike our competitors. We will need to communicate towards our guests that
we can offer these service opportunities to show we are going the extra mile for our guest to
become the next great toy store.
10
Sources
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Kumar, A., & Sharma, R. (2017) Perceived Influential Aspects of TV Advertising. Paradigm
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bold move. Retrieved from
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wal-mart-and-amazon.html
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