Defining diversity: Target Diversity Case Competition 2011
•Als PPTX, PDF herunterladen•
1 gefällt mir•3,595 views
Empfohlen
Empfohlen
Weitere ähnliche Inhalte
Was ist angesagt?
Was ist angesagt? (20)
Andere mochten auch
Andere mochten auch (20)
Ähnlich wie Defining diversity: Target Diversity Case Competition 2011
Ähnlich wie Defining diversity: Target Diversity Case Competition 2011 (20)
Mehr von Jessica H
Kürzlich hochgeladen
Kürzlich hochgeladen (20)
Defining diversity: Target Diversity Case Competition 2011
- 2. Life is a Moving Target OBJECTIVE: Obtain market saturation of the growing minority consumers in the United States NPV: $14,777,521
- 4. Beyond the Bullseye S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s • Great brand recognition • Strong relationship with community • Diverse employees • Target Sourcing Services • PFresh • Minority market: 1/3 of US Population • Customized Marketing: Location& Ethnicity • Social Media i.e. Facebook • Minority Designers for Apparel • Cultural food produce • Late to enter global market • Not international, brand recognition among immigrants not strong • Low association with specific product segments • Large retailer already opening stores targeting specific ethnicity • Current ethnic-specific stores already established • Economy still in recovery Strengths Weaknesses Opportunities Threats
- 5. Demographics S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s San Fransisco Los Angeles Whites 48.5% Asians 33.3% Latinos 15.5% Other 2.7% Latinos 48.5% Whites 9.6% Native American 11.3% Asian 3.2%
- 6. Understanding Our Guests S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Anne Chou Anna-Maria Young, well-educated, moderate-to-better income families Median Age of 42 Median Income of $60,000 51% with college degrees 33% with children Consumer Behavior: Family Oriented, purchase things in bulk
- 7. Competitors Analysis S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Fred Meyer JC Penney Kohl’s Sears Target Product Variety Product Quality Experience Price Low Low Moderate Moderate Moderate
- 8. Strategy Criteria S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Effectiveness Brand/Quality Community Outreach Existing Synergy Capital Expenditure
- 9. Decision Matrix S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Effectiveness Brand/Quality Community Outreach Existing Synergy Capital Expenditure Full Integrated Store Partner with Local Market Online Only Integration National Shift Localization Integration
- 10. Localization Integration S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Food Apparel Cultural Holiday In-Store Presentation Localized Marketing
- 11. Cultural Products: Food S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Asian Hispanic
- 12. Cultural Products: Apparel Focus on Minority Designers National Jersey for World Cup 2014 S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s
- 13. Cultural Holiday: Customization S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Gift Card liabilities: $ 422 million as of January 29th, 2011 Product Variation & Store Environment
- 14. Market Research Strategy S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s • Surveys (Online & Offline) • Test Product Individualized Marketing Research • Facebook • Website Cookies • Consumer Feedback Consumer Demand Research
- 15. In-Store Presentation S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s • Center Piece In P Fresh Area • Target In-Store Catalog • Emphasize products during cultural holiday
- 16. Localized Marketing S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Localized Online Ad Ad Views on Online Video Site Ethnic Food Page
- 17. Strategy Review S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s • Quick implementation timeline, advantage over slow competitors • Geographic specific • Low-risk • Scalability Great timing: include project in Canadian stores opening in 2013 (e.g. Richmond, BC, Canada) Online marketing may not reach some market segments Asian American market very diverse. May be hard to capture that market Strengths Weaknesses Opportunities Threats
- 18. Short Term Implementation Timeline S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Move to CA, FL, TX Heavy Community Outreach Targeted Survey & Ads Rollout in 2 Locations Saturate the 3 States Re-evaluate Nation Saturation Move to Re-grow Expand Premise Move to Other States M3 M9 M12 M15M6
- 19. Long Term Consideration S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Y 2013 + Ethnic Fresh Produce Target in Canada: population is ethnically diverse
- 20. Predicted Cash Flows S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s 0 1000000 2000000 3000000 4000000 5000000 3 6 9 12 Net Cash Flows Net Cash Flows
- 21. Sensitivity Analysis S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s • 4% APR, Δ10% Purchases • $29,078,087 NPV Best Case • 2% APR, Δ5% Purchases • $14,777,521 NPV Initial Assumption • 1% APR, Δ2.5% Purchases • $7,449,223 NPV Worst Case
- 22. Risks & Mitigation S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s Slow Product Turn Over Reduction of Product Quality Increase in Cost Start with packaged goods. Last longer than fresh produce Use of TSS to ensure product quality Implementing project in multiple stores – reduce cost through trade discounts
- 23. Summary S i t u a t i o n | A n a l y s i s | S t r a t e g y | I m p l e m e n t a t i o n | F i n a n c i a l s
- 25. Appendices L i f e i s a M o v i n g Ta r g e t Presentation Slides Beyond the Bullseye Demographics Understanding Our Guests Competitors Analysis Strategy Criteria Decision Matrix Localization Integration Cultural Products: Food Cultural Products: Apparel Cultural Holiday: Customization Market Research Strategy In-Store Presentation Localized Marketing Strategy Review Short Term Implementation Timeline Long Term Consideration Predicted Cash Flows Sensitivity Analysis Risks & Mitigation Summary Target Brand Recognition Distribution Center Imports Warehouse Target’s Community Outreach Understanding Consumers Cultural Holiday Demographics: CA, TX & FL Competitor Current Competitor Localization Efforts: My Macy’s Current Competitor Localization Efforts: Wal-Mart de Sup... Statistics HULU Cash Flow Calculations
- 26. Brand Recognition • “Expect More, Pay Less” • 97% American Consumer recognize the bullseye logo as Target • Bullseye Dog is a trademark, and the Bullseye Design and 'Target' are registered trademarks of Target Brands. L i f e i s a M o v i n g Ta r g e t
- 27. Distribution Center • Regional Distribution Centers: 26 – 4 in CA – 2 in TX, etc • Food Distribution Center for Perishable Food: – Phoenix, AZ – Lake City, FL – Ft. Worth, TX – Cedar Falls, IA L i f e i s a M o v i n g Ta r g e t
- 28. Imports Warehouse • Import Warehouses receive shipments directly from overseas manufacturers and suppliers. Merchandise is then sent from the Import Warehouses to the Regional Distribution Centers. Target currently operates four Import Warehouses. – Rialto, CA – Lacey, WA – Savannah, GA – Suffolk, VA L i f e i s a M o v i n g Ta r g e t
- 29. Cultural Holiday • Asian – February • Chinese Lunar New Year • Tet Nguyen Dan (Vietnam) – October • Diwali • Hispanic – February • 24 - Flag Day (Mexico) – May • 5- Cinco de Mayo L i f e i s a M o v i n g Ta r g e t
- 30. Demographics: CA, TX & FL L i f e i s a M o v i n g Ta r g e t People QuickFacts California Texas Florida USA White persons, percent, 2010 (a) 57.60% 70.40% 75.00% 72.40% Black persons, percent, 2010 (a) 6.20% 11.80% 16.00% 12.60% American Indian and Alaska Native persons, percent, 2010 (a) 1.00% 0.70% 0.40% 0.90% Asian persons, percent, 2010 (a) 13.00% 3.80% 2.40% 4.80% Native Hawaiian and Other Pacific Islander, percent, 2010 (a) 0.40% 0.10% 0.10% 0.20% Persons reporting two or more races, percent, 2010 4.90% 2.70% 2.50% 2.90% Persons of Hispanic or Latino origin, percent, 2010 (b) 37.60% 37.60% 22.50% 16.30% White persons not Hispanic, percent, 2010 40.10% 45.30% 57.90% 63.70%
- 31. Target’s Community Outreach • Donate 5% of revenues to charities • Partner with schools and libraries • Community-based projects • Scholarship/sponsorship of minorities – i.e. Hispanic Scholarship Fund, National Urban League Our Recommendation: • Community projects in International Districts • Sponsor ethnic resource centers L i f e i s a M o v i n g Ta r g e t
- 32. Current Competitor Localization Efforts: My Macy’s • Customer-centric localization, 20 select geographic markets beginning in spring 2008. • Focused on local customer needs and preferences • 13 of Macy’s top 15 best-performing geographic markets in December were My Macy’s pilot districts • My Macy’s will be implemented nationally to new local markets. • Conclusion: Largely successful. Similar implementation plan of starting in select locations and expanding to new locations. L i f e i s a M o v i n g Ta r g e t
- 33. Current Competitor Localization Efforts: Wal-Mart de Supermercado • Opened 2 Supermercado de Wal-Mart stores in Houston and Phoenix in 2009 • The company also will be opening up new locations in Hispanic submarkets of Dallas. • Mas Club, the Hispanic version of Sam’s Club • Conclusion: Was successful. Creative retail strategy L i f e i s a M o v i n g Ta r g e t
- 34. HULU • 48.1 ads per viewer, over 50% more than the average for the top ten video properties by ads viewed • Hulu now has 289 advertisers on board who all need to get their ads shown • 224.3 minutes average per user • Users view ads every 4.66 minutes. L i f e i s a M o v i n g Ta r g e t
- 35. Cash Flow Calculations L i f e i s a M o v i n g Ta r g e t Percentage Minority in Target Market Sales Volume Per Store Per Day Change in Purchasing Number of Stores Implemented
Hinweis der Redaktion
- NPV Objective: target the minority population that is growing in US
- Departments will have ethnic aisle/ shelf placement So consumers would be able to find ethnically relevant product
- Hispanics in United States have an estimated spending power of $175 billion
- Align with their merchandising strategy Innovative offering Value – great quality and price Great shopping experience because of the high performing Target team! One stop shopping place
- Product: snack foods, brand trust Localization – store – from survey etc Marketing localization – website and facebook Synergy with Target – P fresh existance Capital Expenditure – won’t cost much, just making shelf space.
- Thank you Evan. As my colleague, Evan, here has mentioned. Localization integration is a comprehensive strategy that is specifically developed for Target to gain market share in the growing minority population in the United States. There are 5 critical pillars to this strategy: Food, apparel, cultural holiday, in-store presentation and localized marketing.
- Among many products that Target offers, we choose to add variation to Target’s food products to be more ethnically relevant to the local community. It is our priority to increase the Target’s existing customers visit frequency to your stores. Food is something that people buy in consistent manner- this is how Target will be able to gain market share in the minority population. Additionally, This is also aligned with the new Target intiative, P Fresh Popular Asian and Hispanic food products are listed
- We also choose apparel/clothing products because Target gain most revenue because of the high margin Additionally, Most target’s customers are women, young, well educated and have moderate income level. Fashionable apparel is definitely one of their interest. Finally we also want to bring in the world cup aspect, this could be something to consider as we approach 2014, to attract Men customers to come to the store.
- Cultural holidays are very important to the minority populations. This strategy emphasize on customization that is dedicated for those special days. Customization means adding product variation for the week/month or creating a warm store environment that embrace their culture. Finally, customized gift cards is a great way to push to customers. As of Jan 2011, Gifts card liability make up a significant amount of unearned revenue 422 million
- Market Research is essentials in understanding customer’s wants and preference. Facebook is a great tool to advertise surveys as Target has approximately 5.6 million likes on the facebook page. Another facebook utilization to gain individual customers profile, is to integrate facebook to Target’s online customer log in process.
- A visible sign in the store for the ethnic food is definitely very effective to attract customers. We suggest placing food products as the center piece in P Fresh area. Also putting them on catalog and especially emphasize the products during cultural holiday
- Target website has been the most visited website for several years. This is a great place to advertise ethnically relevant product by using the localized online ad. Additionally, Target can also create a page dedicated for ethnic products as well as store locators for such products. Continue with online marketing, Youtube, Hulu, and Telemundo have 1 similarity. Millions of people go to this website and watch videos for hours every day. Many retailers have been using these website to advertise their products and we believe this is a huge opportunity for Target to do the same. Especially telemundo whose viewers are mainly hispanic.
- Overall, our strategy is very comprehensive and quick to implement, geographic specific and involve low risk because it can be scaled at any level. Thing we might consider is that online marketing may not reach some market segments. However, looking at the opportunities, ti