Target made its way to the upper echelons of American retailing by presenting its differences with Wal-Mart. Now, the company's CEO believes it should go head-to-head and invite consumers to compare the quality of the products sold in its stores and prices to those at the world's largest retailer.
Gregg Steinhafel, Target's CEO, told the Dow Jones Newswires that the retailer would continue to "maintain our focus on fashion, design and a superior store experience."
At the same time, Mr. Steinhafel said, "We'll continue to address the gap between the perception and the reality of our pricing."
Target is currently feeling optimistic about its prospects and the company maintains it gained market share over the past year as it remade its private label lineup, tested fresh food sales in its general merchandise stores, remodeled locations and played up in-store savings more than in the past. Recent visits to the retailer's website show it with a much larger number of downloadable coupons, for example, than in the past.
Wal-Mart, for its part, has stumbled somewhat recently, with same-store sales declining in the past quarter.
Some believe that an improving economy alone will bring more shoppers Target's way even if they strayed from the chain during the recession.
"Target is now in a better position being less of a discounter
with the prospect that some consumers are beginning to be a little less conservative
with their money," David Abella, money manager at Rochdale Investment Management,
told Dow Jones.
Discussion Questions: Will 2010 be Target's year? Is it ready to invite direct price comparisons with Wal-Mart? What will it take for Target to overcome the perception that Wal-Mart has lower prices?