Sales Off Target
By George Anderson
Target’s same-store sales have been off for four consecutive quarters and some are beginning to wonder if the company should change its strategy for differentiation in the retailing marketplace.
George Rosenbaum, chairman, Leo J. Shapiro & Associates told The Business Journal of Minneapolis/St. Paul, “The strategy they have had is a very good strategy, but it is the wrong strategy for hard times.”
Mr. Rosenbaum’s firm recently conducted a survey which discovered that 37 percent of consumers plan to shop less this year than they did in 2002.
David Campbell, retail analyst, Davenport & Co. has a differing view on Target. “They seem to have a good strategy of differentiating themselves as an upscale discounter. I think they need to stick with their strategy. I don’t think they have any fundamental problems.”
Moderator’s Comment: Does Target need to change its
strategy because of the weak economic conditions in the country?
George Rosenbaum’s view is Target’s “strategy is not going
to be worth anything if it causes the stock to go into a tailspin.”
We do not agree. Target needs, more than ever, to manage
its business and not its stock price.
One way it could do this is by focusing more attention
on its shoppers. Target calls its shoppers guests. We have to say, from our
recent experience, we’re not altogether sure we were a wanted guest.
Just this weekend, we found ourselves fifth on line at
the checkout. All the other lines were just as long. We noticed a manager, on
his headset, calling for help at the front-end (he didn’t open a register himself).
An announcement requested all available employees to come
to the front. No one showed up while we were on line. We were there too long.
[George
Anderson – Moderator]