Target Hits a Bull’s Eye Online

Discussion
Nov 18, 2005
George Anderson

By George Anderson

The number of consumers visiting Target.com grew 83 percent in September to 11.4 million, and that’s great news for a retailer who is averaging $151 per online transaction.

Wal-Mart.com, as a point of comparison, had more total shoppers than Target during September (15.7 million), but experienced a smaller increase from the prior year (four percent).
The average transaction on Walmart.com is $59, according to eMarketer.

Jeffrey Grau, senior analyst of retail e-commerce at eMarketer, says the visitor numbers are more important than online sales for retailers with physical store locations.
“[Target] is marketing their Web site to drive traffic into their stores more than anything,” he said. “When you consider success, you have to look at the influence of the online
channel not just on online sales, but on bricks-and-mortar sales.”

Moderator’s Comment: What is your analysis of the Target and Wal-Mart web sites? What is the most important criteria for determining if an online site
is successful?

Target sees its web site as a means to “extend the experience” of its stores to an online environment, said Will Seitliff, director of interactive marketing
at the company.

George Anderson – Moderator

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7 Comments on "Target Hits a Bull’s Eye Online"


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Mark Lilien
Guest
15 years 3 months ago

My impression of the 2 sites is that Target has a greater proportion of merchandise at higher price points than Wal-Mart. For example, Target appears to have more furniture. There is no one measure that determines which site is more successful. Besides the measures already listed in the article and the survey, it’s important to know the cost of driving people to the site, and the profitability of the site. And it would be great to know how many people went to the store as a result of using the site, and what they bought. Anyone can easily drive traffic to a site by overspending on promotion, and anyone can easily drive sales by free shipping and other margin reductions. The hard question: does the site help the retailer’s profitability?

Peter Fader
Guest
15 years 3 months ago

I think multichannel retailing is finally at the stage where you can’t easily isolate the impact and profitability of each channel by itself. I think it’s fair to say that both Target and Wal-Mart are successful at using each channel to drive business to the other, and there are no traditional metrics that can pick up these crossover patterns. It’s worthwhile to monitor the simple single-channel metrics, but hard to jump to conclusions about overall system-wide success from them.

Kai Clarke
Guest
15 years 3 months ago

While both Target and Wal-Mart are claiming success with their online efforts, they are still light years away from major retailers like Amazon.com. Some of the first lessons of online marketing continue to be ignored by these giants, including the #1 rule of online marketing; once you are online you are global. For example, neither company makes any effort to include any multi-language support, despite a large population which speaks Spanish in North America. The same is true for French, German, Japanese, and Chinese, despite large decisions by these companies to grow in these parts of the world (Wal-Mart) and have a dedicated focus to international expansion. Target’s site is still text heavy, and neither site provides for product feedback from consumers, which has proven to be a tremendous online success for Amazon and NewEgg.com. Both Wal-Mart and Target need to understand that continuing to ignore the successes of internet retailing is not a way to develop an online presence.

Kerry Ryan
Guest
Kerry Ryan
15 years 3 months ago
I recently had an experience with Target.com and would like to share it here. It shows some significant limitations with the online site. A family member purchased an ecard for me, in an attempt to help with some purchases while I was on vacation. She thought “ecard” meant something similar to “eticket,” as with the airlines, meaning I could print the card and bring it into my local Target. She was wrong. Target’s definition of “ecard” is intended only for use online. Since the site allows the purchase of actual plastic gift cards, I decided to place the order in the same amount as the ecard. Unfortunately, $1.95 was added for s/h. I made the grave error of placing that amount on a Target credit card. Several weeks later, the credit card statement came in for the ENTIRE amount. Apparently, Target’s site PREVENTS its customers from using gifted money in the form of the ecard to order a plastic gift card to go into one of their own brick-and-mortar stores. After approximately six phone calls… Read more »
Stephan Kouzomis
Guest
Stephan Kouzomis
15 years 3 months ago

If sales is the key criteria (questionable) for web sites, Wal-Mart doesn’t need the online program. Logic says, the largest retailer with hundreds of billions of dollar in sales through its brick ‘n mortar just uses online for the purpose of being in that venue, and competitiveness.

The proper criteria is number of visits or hits to the site; interest in high gross margin dollar categories; and the effectiveness of the marketing campaign, i.e. advertising message to get shoppers to the web site program.

One of the best marketing retailers in the U.S. is Target; and it is selling the image, product quality and experience!!!!!

Price isn’t the driving factor!!! So please, let’s compare apples to apples. Hmmmmmmm

By the way, when does marketing become a force in Wal-Mart’s business strategy? There are changes a-coming at Wal-Mart.

Gene Hoffman
Guest
Gene Hoffman
15 years 3 months ago

Both Target’s and Wal-Mart’s websites extend the experiences in their respective stores but the Target experience is usually more enhanced than the Wal-Mart experience. With that as their foundation, Target’s customers are also more psychological inclined and financially capable to look upward and buy more high-ticket goods at “their” store. In my opinion, the high trust its customers have in Target translates favorably into their website merchandising.

nina dawson
Guest
nina dawson
15 years 2 months ago

As a current Target employee, I would like for the words online only to be displayed visibly enough so that we don’t get those irate phone calls.

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