citytarget marketing plan
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CityTarget Marketing PlanTRANSCRIPT
CityTarget Marketing Plan
December 2013 Team Champs: Joua Yang,
Arielle Axelrod, Rachel Turbeville, Carsten Bosselman, Jack Stang
Figure 1: http://burlesquedesign.com/node/1091
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Table of Contents
1.0 EXECUTIVE SUMMARY ................................................................................................................... 3
2.0 STRATEGIC OBJECTIVES ............................................................................................................... 4
3.0 TARGET MARKET INFORMATION .............................................................................................. 7
4.0 COMPETITION .................................................................................................................................. 7
5.0 GENERAL INDUSTRY CONSIDERATIONS ............................................................................... 10
6.0 EXTERNAL ENVIRONMENTAL FACTORS -‐ CDSTEP ............................................................ 11
7.0 SWOT ANALYSIS ........................................................................................................................... 16
8.0 COMPETITIVE ADVANTAGE ...................................................................................................... 17
9.0 SEGMENTATION, TARGETING AND POSITIONING ANALYSIS ........................................ 17
10.0 MARKETING MIX ........................................................................................................................ 19
11.0 IMPLEMENTING STRATEGY ................................................................................................... 22
12.0 APPENDIX ..................................................................................................................................... 25
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CityTarget Marketing Plan
Figure 2: http://4.bp.blogspot.com/_pqFsuK_aN2Y/TK8JJQa-‐
BYI/AAAAAAAAAAY/RCqcM9YqK7I/s1600/masthead_our_mission.jpg 1.0 Executive Summary CityTarget seeks to provide the full “Target experience” in stores half the size. CityTargets will be located in densely populated urban areas in some of the largest cities in the US. Aided by the recognized and respected Target name, CityTarget seeks to branch out and reach this new urban demographic, while further fostering community relationships and brand loyalty. In the launch of new CityTarget stores across the states, we focus our marketing efforts to capture the trendy and fast-‐paced lifestyle of big cities, and we attempt to hone in on what makes CityTarget unique and a valuable addition to the downtown areas in which it is located. We target professionals, as research shows them to be a substantial segment that spends the majority of their time downtown, they have higher-‐paying jobs than peers, and they have lower unemployment rates than the US average. Furthermore, professionals and urban dwellers demonstrate values and culture that propose opportunities for CityTarget. Product offerings will be focused on those most frequently demanded by professionals for their day-‐to-‐day lives and will demonstrate a more professional appearance. Food options will be focused on fresh produce, organic products, and ready-‐and fresh-‐prepared meals to be in line with an increasingly health-‐conscious and time-‐poor society. Promotional efforts will be streamlined and targeted towards the professional demographic using a variety of media: a progressive billboard campaign, social media, and content-‐based marketing with “ABullseyeView”. CityTarget will take advantage of the urban pride these city dwellers feel by featuring a city pride section in its stores, by hosting a community event on the store’s grand opening, and by extending “ABullseyeView” to have city-‐specific pages that invite further engagement with the Target brand. These efforts along with a seating area for eating, a 24-‐hour pharmacy, and a last-‐minute gift section will help CityTarget distinguish itself and stand out against a multitude of shopping choices found in large cities. Through effectively marketing
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CityTarget to the professional demographic, CityTarget will be both a popular and a profitable venture.
2.0 Strategic Objectives 2.1 Mission “Our mission is to make Target your 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.”1 CityTarget is a new venture for the Target Corporation. CityTarget’s objectives include:
• “Offer urban dwellers the same one-‐stop shopping convenience and value they love at other Target locations, but tailored for their lifestyles1.”
• Provide the full “Target experience” for the urban city dweller in a smaller store. • Provide a fast, easy-‐to-‐understand shopping experience
2.2 Business Summary Target Corporation reached operational and economic milestones in 2012 with the launch of its first four CityTarget stores in Chicago, Seattle, San Francisco, and Los Angeles. The CityTarget model is to be expanded and located in densely populated urban markets and will have approximately 40-‐60% of the normal Target model’s square-‐footage1.
The first Target officially opened its doors on May 1, 1962 in Roseville, Minnesota. Target differentiates itself from other retail stores by combining a variety of products into one store while maintaining low prices. In 1994, Target created its official slogan “Expect More. Pay Less,” communicating Target’s value proposition. The first SuperTarget opened in Omaha, Nebraska in 1995; this new model provided guests with a grocery section and featured a larger store space. July 2001 marked the 1,000th store opened. In 2009, Target opened its first stores in Hawaii, marking a presence in all 50 states. By 2012, Target’s total revenue of $69, 865 million topped its competitors (e.g., Kmart, Sears and Kohl's). Increasing online retail sales from 2009 to 2012 benefited the industry sales. Retail sales increased from $144.6 billion in 2009 to $193.7 billion in 2011; sales grew by 3.7% from the second to the third quarter of 2012, resulting in sales of $57 billion. Similarly, the m-‐commerce channel is expected to generate a value of $31 billion by 2015. 2
To set themselves further apart from their key competitors, Target introduced the PFresh concept that brings fresh groceries in 2010. This concept was driven by consumers’ interest in healthier food options and an increasing working population with less time to cook. Pfresh provides pre-‐packaged meat, fresh dairy, and vegetables as a way to offer more meal options and to make grocery shopping more convenient. Within 2010 Target also launched their first limited edition fashion with Missoni (an Italian knitwear company). The designers’ collaboration allowed loyal guests to spend in all economic
1 https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Annual-‐Report.pdf 2 http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=fdc9c2d6-‐09fd-‐4880-‐b2b2-‐09f458ba8690%40sessionmgr15&vid=2&hid=1
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stages and Target looks forward to further collaborating with high fashion designers. In addition, Target launched its REDcard rewards loyalty program in 2010 that allows a 5% discount on most purchases at target.com and at the store, an extra 30 Days return policy, and free shipping.3
2.3 Current Marketing Strategies Target Corporation works to build excitement in its marketing efforts by increasing their presence in social media4, promoting online shopping options, and through store redesigns5. Further, they engage their customers by providing excellent customer service, which aids in creating the “Target experience” and building customer loyalty6. Target also positions itself as a store that provides affordable but high quality and chic goods7 and they especially target younger mothers and families. Target is currently broadening their target markets to reach minority groups as well8. Some examples of Target’s marketing strategies include:
• Social Media Outlets: o Twitter/Facebook: Target uses social media outlets such as Facebook and
Twitter to create brand awareness and customer engagement and excitement. An example of this is Target’s real time social media campaign during the Emmy’s Red Carpet Event. When Tina Fey walked down the carpet in a blue dress, Target immediately posted about everything cobalt with a link to their website on Twitter and Facebook. Their real time social media allowed for an immediate and track-‐able response.9
o Pinterest: To engage with its health conscious consumers, Target uses Pinterest to promote a healthy and well-‐fitted lifestyle by featuring exercise necessities and motivational tips. For example, one motivational tip expresses that “Laughing is the best exercise.” This helps health conscious consumers to persist their health goals.10
• Television: Target introduced price point driven television ads for the first time in January of 2009 in an attempt to increase emphasis on their value message “Expect More, Pay Less.”11 Target increases television marketing around the holidays. October and November are filled with television spots focused on gift inspiration and getting the best deals, oftentimes featuring "The Christmas Champ" (comedian Maria Bamford) or the Deal Duet, who sing about all of the wonderful deals available at Target. With their
3 https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Annual-‐Report.pdf 4 http://www.startribune.com/business/202800651.html 5 https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Annual-‐Report.pdf 6 https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Annual-‐Report.pdf 7 http://hbswk.hbs.edu/archive/4319.html 8 http://www.nyjobsource.com/target.html 9 http://lonelybrand.com/blog/target-‐real-‐time-‐marketing/ 10 https://www.pinterest.com/target/healthy-‐living/ 11http://www.adweek.com/news/advertising-‐branding/target-‐tries-‐first-‐price-‐point-‐driven-‐tv-‐ads-‐105095
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television advertising, Target brings humor and excitement about the holiday season and the Target brand.12
• ABullseyeView.com: Target is engaging in content-‐based marketing with its website “ABullseyeView.” This site seeks to tell "a deeper story" about Target, and to mix lifestyle, entertainment, and company news in with its other promotional mechanisms. Consumers today have a much larger appetite for this type of content Target is providing, and “ABullseyeView” allows for customers to further engage with the Target brand.13 Currently “ABullseyeView” gets 100,000 unique visitors each month.14
• Supporting Minorities: Target has continued to support the Hispanic culture by sponsoring the National Council of La Raza ALMA Awards on September 27th, 2013. The bull terrier mascot Bullseye was also presented on the red carpet with photos taken with celebrities such as Christina Milian and Eva Longoria.15
• Online Shopping: Target promotes online shopping (especially during Christmas season) by providing daily online deals, discounts through their many mobile apps, and in-‐store pickup of online purchases in many of their stores.16
• Mobile Apps: Target is attempting to penetrate the new market of phone apps with their own set of apps like the Target app which allows people easier access to the website and access to promotional deals for Target stores near your location. Cartwheel, another Target app, allows you to save 5%-‐50% on items that you already buy by selecting them on the app and compiling all of the deals onto one barcode that can be scanned at the register.17
• Community Engagement: o Target actively supports the need for educational success for kids and schools.
Some ways to accomplish this includes book donations, field trips, and free museum days to food pantries. Target is aware that third grade is when kids transition from “learning to read” to “reading to learn”, so they emphasize programs to aid students’ reading proficiency.18
o Target partnered with Feeding America and local food banks in 2001, introducing the Meals for Minds Program. This program is available in 66 schools in 44 cities across the United Sates; it brings fresh food and staple items directly to schools to be distributed to K-‐12 students and families who lack food resources.19
o Target Community Nights are powered by Target at the Franklin Institute. They are free, educational, and fun science adventure community events. Guests
12 http://adage.com/article/news/target-‐aggressive-‐holiday-‐marketing-‐strategy/237800/ 13 http://www.minnpost.com/business/2013/10/targets-‐marketing-‐efforts-‐are-‐right-‐target-‐revamped-‐bullseye-‐view 14 http://digiday.com/brands/targets-‐show-‐dont-‐ell-‐content-‐strategy/ 15 http://www.fashionodds.com/stars-‐celebrate-‐the-‐alma-‐awards-‐with-‐targets-‐bullseye-‐the-‐dog/ 16 http://www.startribune.com/business/229019241.html 17 https://play.google.com/store/apps/developer?id=Target+Corporation&hl=en 18 https://corporate.target.com/corporate-‐responsibility/education 19 https://corporate.target.com/corporate-‐responsibility/community-‐impact
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receive the chance to explore the Franklin Institute's honored exhibitions, exceptional programs, and themed activities.20
3.0 Target Market Information 3.1 Target’s Consumer Demographics
Target Corporation markets itself as a fun and trendy retailer that offers high quality goods at an affordable price. They promise an excellent and value-‐driven shopping experience through the value proposition “Expect More, Pay Less.” The Target name is extremely recognized throughout the US (and branching into Canada) and is associated with the value and convenience the brand promises.21
Current Target Market:
• Median age of 40 (youngest of all major retailers) • Median household income is $64,00 per year • 80% of customers are female • 33% have one or more children in their household • 57% of customers have college degrees.22
Target presents itself as a discounted, but high-‐quality retailer. They promise their guests
that Target is a one-‐stop shopping destination to have high quality, diversified merchandise in a trendy and fun environment while saving cash.23 From fresh groceries to everyday goods, trendy fashion to innovative furniture, Target attempts to meet their guests shopping expectations.
4.0 Competition
CityTarget’s main competition will be retailers and grocers located downtown in the central business districts in major U.S. cities. These retailers are numerous, ranging from local stores, to chain retailers, to well-‐established department stores and grocers. CityTarget faces competition not only from these well-‐known local retailers, but also from newly emerging big-‐box city stores such as Walmart Express, all competing for the attention of the fast-‐paced urban consumer.24 CityTarget faces competition in pricing strategy as well, as Target has long persisted in selling its products at higher prices than some of its discount store counterparts. Especially in the current weak condition of the economy, consumers are prompted to seek better deals through wholesalers and cost-‐cutting stores such as Walmart.25 Moreover, Target faces risk because its store brands (Up and Up, Archer
20 http://www2.fi.edu/visitor-‐guide/events/community-‐events.php 21 http://hbswk.hbs.edu/archive/4319.html 22 http://www.nyjobsource.com/target.html 23 http://marketingmixx.com/marketing-‐basics/swot-‐analysis-‐marketing-‐basics/177-‐target-‐corporation-‐swot-‐analysis.html 24 http://corporate.walmart.com/our-‐story/our-‐business/walmart-‐us 25 http://www.trefis.com/stock/tgt/articles/159756/target-‐corporation-‐risks-‐versus-‐opportunities/2012-‐12-‐21
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Farms) are less-‐well known than its major competitors.26 Listed below are a few of CityTarget’s main competitors:
• Walmart Corporation (Walmart, Walmart Express) o Walmart is currently Target’s largest competition in the industry o Walmart is the largest retailer in the world with stores in cities such as Los
Angeles, Minneapolis, Austin, Beijing, and Mexico City27 o Competitive with CityTarget because both target similar markets o Walmart Express is likely to expand into the urban city.28 If this occurs, Walmart
Express could be a major competitor for CityTarget o Offers similar products including groceries and pharmacies o Wal-‐Mart Express opened in multiple locations before CityTarget o Relationship to CityTarget:
§ While these companies offer similar products, CityTarget offers higher quality products to meet needs of higher income consumers29
§ Both have stores located in Chicago30 o Target Corporation differentiates itself from Walmart Corporation by investing
in consumer relationships. Walmart has a higher focus on cutting costs31 However, Target’s increased product overlap with Walmart in food and other goods could hinder the higher mark ups. Both companies are looking to expand their impact in the city through CityTarget and Walmart Express by offering smaller stores for quick access with fewer options32
• Walgreens33 o The United States’ largest drugstore chain34 o $71.6 billion in fiscal net sales in 201235 o Established presence in the central business districts of U.S. cities and very popular
among urban consumers36 o Large product offerings
§ Pharmaceuticals
26 http://business.time.com/2013/01/23/target-‐introduces-‐six-‐new-‐brands-‐that-‐you-‐cant-‐buy-‐in-‐stores/ 27 http://news.walmart.com/walmart-‐facts/ 28 http://corporate.walmart.com/our-‐story/our-‐business/walmart-‐us 29 http://condoroptions.com/2008/04/30/bonus-‐trade-‐wal-‐mart-‐vs-‐target/ 30http://www.walmart.com/storeLocator/ca_storefinder_results.do?serviceName=&rx_title=com.wm.www.apps.storelocator.page.serviceLink.title.default&rx_dest=%2Findex.gsp&sfrecords=50&sfsearch_single_line_address=Chicago 31 http://mobile.bloomberg.com/news/2013-‐03-‐26/customers-‐flee-‐wal-‐mart-‐empty-‐shelves-‐for-‐target-‐costco.html 32 http://www.dailyfinance.com/2013/09/25/should-‐size-‐matter-‐when-‐it-‐comes-‐to-‐big-‐box-‐retail/ 33 http://www.icic.org/connection/blog-‐entry/blog-‐are-‐pharmacies-‐the-‐next-‐urban-‐one-‐stop-‐shopping-‐centers 34 http://files.shareholder.com/downloads/WAG/2750195936x0x608988/5A4CA423-‐70A4-‐46A7-‐876E-‐0EA1FBDF14AA/WAG_2012_AR_lo.pdf 35 http://files.shareholder.com/downloads/WAG/2750195936x0x608988/5A4CA423-‐70A4-‐46A7-‐876E-‐0EA1FBDF14AA/WAG_2012_AR_lo.pdf 36http://bikeportland.org/2013/05/14/walgreens-‐now-‐welcomes-‐people-‐on-‐bikes-‐at-‐outdoor-‐service-‐windows-‐86706
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§ Beauty and Household Items § Groceries
o Relationship to CityTarget § Both companies have a customer loyalty card which drives growth37 § Both have stores in Chicago, Los Angeles, and Portland38 § While they provide many of the same products, Walgreens is primarily a
pharmacy with greater selection of health products. Only a few CityTargets have pharmacies39
• Local Farmer’s Markets o Offer groceries for urban dwellers and gives price-‐conscious consumers a chance to
buy local40 o Recent government involvement to bring farmers markets to urban cities41 o Well known and attended by urban consumers42 o Relationship to City Target
§ Both offer groceries. Farmers Markets often can provide specialty and greater diversity in selection of food items43
§ CityTarget has an advantage because it provides more than grocery products § Slightly different target markets based on income: farmers markets market
more towards low-‐income consumers44 • Macys
o 167,000 employees o 850 stores in 45 states o Large presence in New York City; sponsorship of the Macy’s Thanksgiving Day
Parade45 o Premier national omni-‐channel retailer with iconic brands46 o Relationship to CityTarget
§ Both companies are focusing more on appealing to a younger, urban generation than they have in the past47
§ Target has over twice as many locations and employees than Macy’s currently does48
Other competitors to CityTarget include retail stores, supermarkets and other local grocers.
37 http://files.shareholder.com/downloads/WAG/2750195936x0x608988/5A4CA423-‐70A4-‐46A7-‐876E-‐0EA1FBDF14AA/WAG_2012_AR_lo.pdf 38 http://www.walgreens.com/storelocator/find.jsp 39 http://sf.racked.com/archives/2013/10/01/citytarget-‐2-‐opens-‐at-‐geary-‐and-‐masonic-‐next-‐week.php 40 http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELDEV3101257 41 http://www.judicialwatch.org/blog/2011/06/10-‐mil-‐to-‐bring-‐farmers-‐markets-‐to-‐urban-‐areas/ 42 http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELDEV3101257 43 http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELDEV3101257 44 http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELDEV3101257 45 http://www.nbc.com/macys-‐thanksgiving-‐day-‐parade/ 46 http://en.wikipedia.org/wiki/Macy%27s 47 http://www.retailwire.com/discussion/15899/macys-‐goes-‐all-‐millennial 48 http://investors.target.com/phoenix.zhtml?c=65828&p=irol-‐homeprofile
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5.0 General Industry Considerations Target operates in the multiline retail industry -‐ the consumer discretionary sector
including the owners and operators of department stores and stores offering diversified general merchandise.49
Retail Industry: • Produces approximately two-‐thirds of the U.S. gross domestic product50 • Spending capital internally to spur growth
o 61% of companies in the retail industry increased spending on geographic expansion as of 2013
o 41% increased spending on information technology as of 2013 o 11% increased employee compensation and training as of 2013
• Recent increase in social media use o 71% of companies in the retail industry use social media outlets
(Facebook, Twitter, etc.) as of 2013 o 52% use mobile and/or online shopping as of 2013 o 12% use show-‐rooming as a tactic as of 201351
• Recent trend to market to millennials52 • More spending on U.S. digital advertising than any other industry
o $8.21 billion in 2012 o Approximately 64.6% of digital advertising is spent on direct response
campaigns53 o Companies with the highest Capitalization in retail industry:
§ Walmart Stores § Costco Wholesale Corporation § Walmart Mexico § Target Corporation
Target operates in the grocery industry as well. Out of its $68.5 billion sales, 19% was of grocery and pet supplies. 60% of its 1,782 stores offer a variety of fresh foods and 250 of its stores offer a full grocery store.54 Grocery Industry:
• Produced 6% of the U.S. gross domestic product in 2009 • Provided more than 1.7 million jobs55 • Grocery sales increased 11% from 343 billion in 2007 to 380 billion in 2011
49https://eresearch.fidelity.com/eresearch/markets_sectors/sectors/industries.jhtml?tab=learn&industry=255030 50 http://retailindustry.about.com/od/statisticsresearch/p/retailindustry.htm 51 https://www.kpmg.com/US/en/IssuesAndInsights/ArticlesPublications/Documents/retail-‐outlook-‐survey-‐2013.pdf 52 http://www.sas.com/news/sascom/2012q1/industry_spotlight.html 53 http://www.emarketer.com/Article/Retail-‐Industry-‐Remains-‐Largest-‐Spender-‐US-‐Digital-‐Advertising/1010187 54 http://www.startribune.com/business/185960182.html 55 http://www.gmaonline.org/blog/?p=1404
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• Warehouse clubs and supercenters (WCS) are the main competitors to traditional supermarkets. These include:
o Costco o Kmart o Walmart o Target o Sam’s Club
• Recent trends suggest that as supermarkets improve their systems, super stores (i.e. Walmart and Target) are slowing in growth.56
• Social Media: o In 2012 there was a 25% increase in grocery conversation on Yelp (from
2011) o Consumers have over 10 million grocery related conversations annually
online o Many supermarkets are starting to use social media to allow consumers to
express their opinions § Enables supermarkets to keep up with micro and macro trends57
6.0 External Environmental Factors -‐ CDSTEP Culture:
• Urban pride: urban dwellers’ identities are closely tied to that of the city they live in (culture, brand, heritage).58
• American Cultural Values:59 o Personal control over the environment o Change/mobility o Time and its importance o Equality o Individualism, Independence, and Privacy o Self-‐help o Competition and Free Enterprise o Optimism o Work is morally right o Informality o Directness/Openness/Honesty o Practicality/Efficiency o Materialism
56 http://www.progressivegrocer.com/top-‐stories/expert-‐columns/industry-‐intelligence/id35716/current-‐u-‐s-‐grocery-‐retailing-‐trends/ 57 http://www.progressivegrocer.com/top-‐stories/headlines/technology/id36682/social-‐media-‐influence-‐in-‐grocery-‐is-‐growing-‐study/ 58 http://www.marketingcharts.com/wp/direct/marketing-‐to-‐upscale-‐urban-‐consumers-‐15933/ 59 http://www.bu.edu/isso/Tips/AmericanValues.pdf
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Demographics: • Income
o Median household income in the top 20 most populated US cities ranged from $34,207-‐$76,593 in 201160.
o In September 2012 young professionals earned on average $973 per week. $681 per week for 22-‐year olds and $1,319 per week for 35-‐year olds.61
• Education o As of 2010,
approximately 24% of people aged 25-‐34 have received a Bachelor's Degree and 8.9% have advanced degrees. This age group has the largest percentage of Bachelor's degrees.62
o 33% of young professionals in the US are minorities (5.4 million of 16.3 million workers)63
• Location o 82% of Americans live in urbanized areas (population greater than or equal to
50,000) and this figure is growing at a rate of 1.2% annually.64 o Young professionals are increasingly buying apartments in central business
districts, even when they work in the suburbs, to enjoy the city lifestyle. 65 o Baby boomers are selling their suburban homes and moving to the downtown
areas as well, demanding many of the same amenities as their Generation Y counterparts.66
60 http://www.statista.com/statistics/205609/median-‐household-‐income-‐in-‐the-‐top-‐20-‐most-‐populated-‐cities-‐in-‐the-‐us/ 61 http://dpeaflcio.org/programs-‐publications/issue-‐fact-‐sheets/the-‐young-‐professional-‐workforce/ 62 http://www.census.gov/compendia/statab/2012/tables/12s0231.pdf 63 http://dpeaflcio.org/programs-‐publications/issue-‐fact-‐sheets/the-‐young-‐professional-‐workforce/ 64 http://www.indexmundi.com/united_states/demographics_profile.html 65 http://www.jsonline.com/business/127075593.html#ixzz2lEPzCYf8
Figure 3: http://www.clrsearch.com/Chicago-‐Demographics/IL/ http://www.clrsearch.com/Seattle-‐Demographics/WA/
http://www.clrsearch.com/San-‐ Francisco-‐Demographics/CA/
http://www.clrsearch.com/Los-‐Angeles-‐Demographics/CA/
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o According to the Bureau of Labor Statistics, There are 18.2 suburb-‐to-‐city commuters, and only 8 million city-‐to-‐suburb commuters in the United States. This adds an extra 10.2 million people in the densely populated city each week day. Furthermore, 27.4 million people stay within the city for work each day. In total, approximately 45.6 million Americans are in cities on a daily basis.67
o There has been a sharp rise in immigration to the United States recently, mostly of Latin American and Asian descent, and these immigrants are settling largely in urban areas68.
§ Statistics show that the conventional view of cities being in decline and having majority black residents fail to take into account recent immigration/migration waves.
§ There are 12 metropolitan areas with significant Hispanic and Asian presence that can be categorized as Multiethnic High Immigration areas. The largest of these are New York, Los Angeles, Chicago, Washington D.C., and San Francisco.
§ Slow-‐growing areas where white-‐black dynamics has historically been an important demographic attribute are mainly in the Rustbelt (Philadelphia, Cleveland, etc.), with New Orleans being an exception. Fast-‐growing areas mainly located in the Southeast
§ Mostly white fast-‐growing areas are primarily in the West and Midwest. Mostly white slow-‐growing areas are mainly in the Northeast and Midwest (Louisville excepted).69
Social: • Five values drive the conscious consumer: Health and Safety, Honesty, Convenience,
Relationships, and Doing Good.70 • Value-‐conscious consumers -‐ Consumers are expecting more for their money than ever,
but they still want to remain relevant and with the times in the products they buy/consume.71
• Convenience (time-‐poor) -‐ urban consumers are demanding increased convenience in the purchase of food as well as other household goods.72
• Health and Wellness Concerns: Society is making a shift towards promoting healthier lifestyles.73
• Choice rich society: Urban consumers have a plethora of options to fulfill their needs. New products or market offerings need to stand out amongst the crowd and clearly demonstrate value to the consumer.74
66 http://www.treehugger.com/urban-‐design/yet-‐another-‐study-‐shows-‐how-‐gen-‐y-‐wants-‐live-‐and-‐work-‐downtown.html 67 http://www.statisticbrain.com/commute-‐statistics/ 68 http://search.proquest.com/docview/195568045/fulltextPDF?accountid=351 69 http://www.city-‐data.com/ 70 http://www.fmi.org/docs/sustainability/BBMG_Conscious_Consumer_White_Paper.pdf 71 http://www.nielsen.com/us/en/reports/2011/rise-‐of-‐the-‐value-‐conscious-‐shopper.html 72 http://www.firstdata.com/en_us/insights/Perspective_Cox_Consumers_Want.html 73 http://www.fmi.org/docs/sustainability/BBMG_Conscious_Consumer
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• Urban lifestyle o Trendy and stylish: Urban consumers want to
remain on the cutting edge of fashion and accessory choices, but they want to keep up with trends in food, decor, and other household items as well.
o Fast-‐paced and energy-‐rich.75 o Green conscious consumer: consumers want
to support companies who are open and accountable for their actions and the impact they have on the environment.76
o Sustainable and Socially Responsible: Cities are increasingly seen as a leader in the quest for sustainability. Urban dwellers are more eco-‐friendly and support eco-‐friendly products and firms. Furthermore, social responsibility continues to gain popularity amongst consumers.77
• About one in three Americans engage in community services through local organizations. Levels of community differ depending on if people live in rural, urban or suburban area, their level of education and economic situation.
o Residents in economic decline communities show high levels of community trust and great levels of community engagement.
o College educated students in all rural communities are more likely to engage in local community services than their non-‐educated college students.78
o Involvement in institutionally-‐based activities is less prevalent: § 21% often volunteer with a religious organization § 14% volunteer with schools, libraries or hospitals § 13% of Americans usually collaborate with the neighbor to solve
community problem. § 8% volunteer often with a charity or advocacy organization.79
Technology
• Firms are focusing on concentrated, engaging marketing to specific target markets o No longer using broad, generic advertisements to reach the masses80
• Firms use a diverse set of social media that change constantly o Examples are Twitter, Facebook, Instagram, Google+, and Pinterest
• Consumers prefer simplistic marketing messages • Web content is now mobile-‐user friendly80
74 http://www.marketingcharts.com/wp/direct/marketing-‐to-‐upscale-‐urban-‐consumers-‐15933/ 75 http://www.marketingcharts.com/wp/direct/marketing-‐to-‐upscale-‐urban-‐consumers-‐15933/ 76 http://www.fmi.org/docs/sustainability/bbmg_conscious_consumer_white_paper.pdf?sfvrsn=2 77 http://www.fmi.org/docs/sustainability/bbmg_conscious_consumer_white_paper.pdf?sfvrsn=2 78 http://www.carseyinstitute.unh.edu/publications/IB-‐Dillon-‐Civic-‐Attitudes.pdf 79 http://www.citizenshandbook.org/lwv/current_state.html
Figure 4: http://www.blogcdn.com/www.dailyfinance.com/
media/2013/04/grocery-‐shopping-‐604-‐cs040213.jpg
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• Ad-‐retargeting is on the rise o Ad-‐retargeting is when a consumer’s visits to websites are tracked and then these
websites pop up in the form of ads on alternative websites • Firms are also making their web content easily shared on a variety of social media sites80 • Consumers want to gather the essential information from an advertisement so they can
either use or throw away the information81 • Electronic mobile payment is on the rise • Loyalty has become part of Social Media • Consumers value integration between all platforms82 • Firms must be as green as their marketing suggests • Consumers are demanding content from firms
o Blogs o Videos o Tutorials o Social media
• Traditional media outlets should not be overlooked82 • Simultaneous channel growth and increasing strong e-‐commerce and innovations in mobile
commerce. M-‐commerce channel is expected to generate a value of $31 billion by 201583 Economic:
• Only 3.4% of professionals, managers, and other related professions are currently unemployed, much higher than the national unemployment rate of 7.3%.84
Political: • The Credit Card Accountability, Responsibility and Disclosure Act made in of 2009 enforced
stricter U.S. credit card regulations and pushed companies to act more ethically toward its customers and further utilized income and assets as qualification factors of its potential cardholders.85
• Firms often track their customer’s purchasing habits through loyalty cards and online purchases. Sometimes this becomes unethical when a company uses personal information to send embarrassing coupons in the mail86
• Many large firms (big box retailers) have recently been fined for illegal waste dumping with fines totaling in the millions of dollars for each case.87
80 http://www.forbes.com/sites/jaysondemers/2013/09/17/the-‐top-‐7-‐online-‐marketing-‐trends-‐that-‐will-‐dominate-‐2014/2/ 81 http://www.insivia.com/5-‐more-‐digital-‐marketing-‐trends-‐for-‐2014/ 82 http://www.cmo.com/slide-‐shows/_13_major_marketing_.html 83 http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=da66aa0e-‐6274-‐4490-‐999f-‐6fe3b62feff2%40sessionmgr12&vid=7&hid=14 84 http://www.bls.gov/news.release/empsit.t13.htm 85 http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=fdc9c2d6-‐09fd-‐4880-‐b2b2-‐09f458ba8690%40sessionmgr15&vid=2&hid=1 86 http://www.forbes.com/sites/kashmirhill/2012/02/16/how-‐target-‐figured-‐out-‐a-‐teen-‐girl-‐was-‐pregnant-‐before-‐her-‐father-‐did/
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• Healthcare costs for the US employers are estimated to grow by 5.3% in 2013 compared to 2012. 88
7.0 SWOT Analysis 7.1 Internal Environment: Strengths:
• Well established presence: This company stands as one of the largest retailers in the US. • Target name is recognized and associated with value • Strong value proposition: “Expect More Pay Less” • Customer loyalty via the REDcard rewards program • PFresh • Effective current marketing strategies • Strong social media presence • Social Responsibility • Successful collaboration with designers and boutiques
Weaknesses:
• High quality products incur higher prices for customers, contradicting value proposition “Expect More, Pay Less.”
• Brand retrieval of store brands (Up and Up, Archer Farms etc.) is lower than brand retrieval of competitors.
• Negative environmental impacts 7.2 External Environment: Opportunities:
• Expanding business to new locations and new markets • Social media integration across all platforms • M-‐commerce and E-‐commerce • Simplistic advertisements • Urban Pride • Community involvement
Threats:
• Increased overlap in product assortment with competitors • Tightening US credit cards regulation • Rising labor wages and healthcare costs
87 http://blog.idrenvironmental.com/blog/bid/337609/Is-‐Illegally-‐Dumping-‐Hazardous-‐Waste-‐A-‐Viable-‐Business-‐Strategy 88 http://www.healthreformgps.org/resources/employers-‐look-‐for-‐new-‐ways-‐to-‐cut-‐costs/
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8.0 Competitive Advantage Target maintains a distinct competitive advantage in the customer and brand loyalty they
already hold amongst urban consumers as well as the value they strive to bring. Target displays strong merchandising through their work with prestigious designers to bring affordable and friendly budgeted fashion and co-‐branding with boutiques. This effort is in line with a trendy and stylish urban lifestyle but also maintains Target’s value proposition/business promise to “Expect More, Pay Less.” Moreover, Target’s PFresh gives Target an advantage with an increasingly health-‐conscious society.
CityTarget is a quick and convenient one-‐stop-‐shop for the fast-‐paced urban lifestyle. Consumers can still enjoy the full “Target Experience” in this smaller urban layout. Furthermore, Target demonstrates social responsibility with their giving back to the local society and education, fostering loyalty with the socially responsible consumer as well as the urban dwellers that feel a strong sense of city pride.
While Target stands as the one of the largest US retailers, it is aware of its threats and weaknesses. Recently, it engaged in trademark infringement, unequal employment treatment and illegal dumping waste. In addition, some consumers find the value proposition of” Expect More, Pay Less.” failing to meet their shopping experience. Some of its products receive low brand recognition, making some of its brand not a part of the brand retrieval set for consumers. To maintain its competitive advantage, Target continues to practice its strengths while taking advantage of opportunities, extending these to CityTarget. Target’s strong, cutting-‐
edge merchandise may best differentiate itself from its competitors. The REDcard Loyalty Program continues proliferation and has been successful in drawing in traffic online and in stores. Target’s financial position is expected to expand with its strong e-‐commerce and growing m-‐commerce opportunities. Target will also continue to collaborate with new brands and designers while reinforcing recognition of current brands for CityTarget consumers.
9.0 Segmentation, Targeting, and Positioning (For more information on the STP analysis, see appendix 12.2) 9.1 Potential Market Segments
• Minorities o Identifiable: similar ethnic backgrounds typically live in the same neighborhood o Substantial: a growing portion of the urban population o Reachable: language, cultural understanding, how they view their role as
consumer, what they value
Figure 5: http://celiasue.files.wordpress.com/2010/01/targe
t_dog.jpg
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o Responsiveness: won’t have same access to CityTarget because of location (business district) and transportation to these areas
o Profitable: shopping for family, incomes to determine profitability • Professionals
o Identifiable: income, job, and location of job o Substantial: 45.6 million professionals in large cities daily o Reachable: attracted to eye catching and unique advertisements communicating
fit with their lifestyles and ideals o Responsiveness: must show the value in the store by eliminating inconveniences
of typical shopping downtown o Profitable: middle to high income, low unemployment rates, willing to spend
more for prestige products, upscale food CityTarget will find the most success by targeting professionals with their new urban
layout. Professionals are an identifiable segment due to their salaries, job type, and locations. They are substantial in size, have high-‐income levels, live and work in the cities, and have low unemployment rates. Professionals can easily be reached with eye-‐catching advertisements that clearly communicate CityTarget’s value proposition. Professionals will respond to cutting-‐edge marketing tactics and the convenience of the CityTarget layout, and their incomes and lifestyles will provide a profitable base.
9.2 Targeting Strategies CityTarget will utilize two marketing strategies in order to reach the professional target market. CityTarget will take an undifferentiated approach by capitalizing on its value proposition of "Expect More, Pay Less." This value proposition is easily relatable and recognizable. Further, by promoting convenience, reliability, health consciousness, and social responsibility, CityTarget will be able to relate to consumers’ values. CityTarget will also take a differentiated targeting approach to appeal to professionals and to the variations within our target market. This will be done by targeting the different lifestyles found between younger and older professionals. Younger professionals will be targeted with trendy products and a focus on urban pride, while older professionals will appreciate the practicality of CityTarget and the added value it brings to central business districts.
9.3 Positioning Strategies CityTarget will position itself as a convenient one-‐stop-‐shop for professionals’ every need, from home goods to groceries, that delivers quality and value. CityTarget will
Figure 6: http://3.bp.blogspot.com/-‐P6Ay9iwBoII/TgkqmovR6dI/AAAAAAAADyk/UNW
rISE6-‐q4/s400/TargetLady.jpg
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communicate the added value it brings to downtown areas and the ways in which CityTarget fits the urban lifestyle. CityTarget will be positioned as a socially responsible community member, grounded in the city in which it is located, further differentiating CityTarget from its competitors.
10.0 Marketing Mix 10.1 Product For CityTarget to keep the same experience as other Target stores, CityTarget needs to maintain the same variety of products but on a smaller scale. This means that there will be the same general items (like paper towels) but there will not be as many brands to choose from in order to save space but maintain the aesthetic of the urban store. CityTarget will focus on carrying higher quantities of the products most frequently demanded by urban consumers.
Products CityTarget Should Carry:
• Groceries (similar to Target layout, NOT SuperTarget layout) o Fresh Produce (PFresh) o Staple Items o To-‐go Meals (ex: D’Amico sandwiches and salads)
• Health and Beauty Products • Pharmacy • Electronics
o Phone Accessories § Cases § Charges § Headsets
• Video games • Clothing
o Active Wear • Home • Entertainment • Toys • Kitchen • Office
Because of size constraints, CityTarget will need to downsize certain products/sections to match the needs of professional consumers. Target should downsize the amount of big-‐box electronics and household products as well as the amount of clothing overall. CityTarget should also downsize the amount of toys and kitchen supplies but maintain the basics. Products CityTarget Should Downsize:
• Electronics o Big box items
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§ TV § Video Game System § Stereos § Printers
o Cellphones • Health and Beauty
o Downsize bath accessories • Clothing (Downsize)
o Baby Products and Clothing o Women’s
§ Focus less on Juniors o Men’s o Children o Shoes
• Home (Downsize) o Furniture
§ Stand Up Lamps o Storage Bins
• Toys o Largely Downsize (Keep popular toys for
presents) • Kitchen
o Keep basics o Have a few options for appliances o Maintain trendy appliances (e.g. Martha Stewart)
With the fast-‐paced lifestyle of a city dweller, CityTarget should make an effort to provide quick, healthy food options and a convenient gift selection. Playing local music throughout the store would help improve the atmosphere, demonstrate urban pride, and draw more professionals in on their lunch breaks. After drawing them in, CityTarget should have more professional clothing options and makeup artists in the store, which would increase their overall experience. New Products CityTarget Should Add: Food
o Healthier/organic o Soup, sandwich and salad bar o Deli Counter/pizza counter o Cooked Meat
§ Rotisserie Chicken • Health and Beauty Products
o Makeup Artist/Advisor
Figure 7: http://b.vimeocdn.com/ts/258/403/25840378
3_640.jpg
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o Prestigious Brands • Pharmacy
o 24hr Pharmacy • Clothing
o More professional options • Urban Pride Section
o Featuring local merchandise § Music § Food § Clothing
• I Heart “City” § Accessories
• Mugs • Last Minute Gift Ideas
o Toys o Cards o Small gift items o Wrapping option available o Balloons
10.2 Price CityTarget can give a slight price increase to its products/offerings across the board to capture the more prestigious image and to help bear the increased costs of urban real estate. CityTarget will still be a low-‐price alternative and encompass the same value that Target is known for, but prices will be more in line with those of its urban competition.
10.3 Place CityTarget will be located in densely populated, urban areas. They will focus on growing cities that demonstrate urban pride and trendy urban lifestyles. CityTarget will be most profitable in locations with large professional presence.
10.4 Promotion
Because Target is such a recognized brand, promotional efforts will focus on communicating the new features and added value unique to CityTarget. Marketing tactics will be simplistic, trendy, and city-‐specific, utilizing a variety of media channels (billboards, social media, “ABullseyeView,” community events) to communicate CityTarget’s value proposition. CityTarget’s advertising style will be similar to that of other prestigious brands, such as Apple and Google, and will be associated with the same image. CityTarget will still offer and communicate the value Target is known for, but we believe this streamlined focus will best attract professionals to the stores. Our vision for CityTarget’s promotional billboards is simplistic yet eye-‐catching. The billboards will evolve over time to correspond with each stage of the construction of CityTarget. The billboards should be sparingly placed in key, eye-‐catching spots in
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metropolitan areas where young professionals are most likely to view them. The background of the billboards would be a solid color accented with the word “CityTarget.” that would evolve overtime as the building was completed. The word city target could be made out of iconic buildings from the area to play off consumer’s city pride. Once the building of the new CityTarget was complete, the billboard could continue to promote the store by creating the words CityTarget out of other unique aspects of the particular city. For example: foods, celebrities, sports team, music etc. We also plan to extend the use of ABullseyeView so as to further encapture the opportunity present in urban pride. Our research showed that content-‐based marketing is becoming more widely demanded by consumers, and ABulleseyeView is a great platform to encourage engagement and excitement about the Target brand. ABullseyeView will feature city-‐specific pages to keep the consumer in the know with happenings, events, food, etc. of the city in which it is located. Through encouragement of urban pride, we hope to raise the number of unique visitors per month (currently 100,000) by 2,000 in the first few months of each new CityTarget store opening. CityTarget will announce its grand opening with an all-‐encompassing community event that draws on local vendors, food, music and art. By featuring local cuisine and art, CityTarget will draw on city-‐dwellers urban pride; this will also link CityTarget’s brand name to the community and establish a relationship and connection with the consumer. CityTarget will give out prizes, promotions and raffle off CDs and displayed artwork. They will also raffle promotional products for Target such as giftcards and shopping spree. Another option would be for CityTarget to sponsor free music and foods. To continue this image, CityTarget can continue to sponsor local community events throughout the year. CityTarget will also create a variety of social media campaigns to increase awareness of the CityTarget concept and to generate conversations about CityTarget’s place in the cities. We recommend a broad “CityTarget” campaign to promote the overall concept of the store, as well as city-‐specific campaigns in each city a CityTarget is or will be located. The social media campaign will utilize a variety of social media platforms: Twitter, Facebook, Instagram, and YouTube, and some content will link back to ABullseyeView.com. The campaigns are intended to increase excitement about CityTarget and so will feature city culture (food, music, sporting teams, etc.), unique gift and recipe ideas, promotional messages, and questions prompting response and conversation.
11.0 Implementing Strategy 11.1 Timeline
• Central billboard announcing CityTarget • Launch social media campaign and additional city-‐specific pages on ABullseyeView • Begin construction • Maintain and update billboard during construction utilizing progressive billboard
campaign outlined above • Add billboards 1 month prior to opening • Community outreach event to celebrate the grand opening • Final billboard simply stating that there is a CityTarget in the city
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• Continue monitoring and updating website, ABullseyeView, and social media to maintain engagement
11.2 Marketing Objectives
• Attract professionals to CityTarget • Communicate the larger focus on quality and professionalism • Promote new features unique to CityTarget • Increase activity and excitement on social media pertaining to the specific cities • Create a loyal customer base • Deliver the full “Target experience” in an urban setting
11.3 Financial Features
• Billboard o Average billboard when leaving a city costs around $1,00089 o Average billboard while entering or already inside the city costs $2,50090 o Times square experiences 1.5 million advertising impressions each day91
• Social Media Costs for Management o Twitter: $1,000 o Facebook $50,00092
• Social Media Salaries (average for top 20 largest US cities) o Social Media Specialist: $34,000-‐$52,000 o Social Media Strategist: $41,000-‐$70,000 o Social Media Marketing Manager: $54,000-‐$85,000 o Online Community Manager: $39,000-‐$58,000 o Public Relations/Brand Manager: $36,000-‐$66,00093
• M-‐Commerce: maintain strong presence in order to generate predicted value of $61 billion by 2015
• Community Outreach Events – estimated cost of appx. $10,000 given costs of food, givaways, music, etc.
• Typical response rate for online advertising is 1-‐3%94
11.4 Potential Return on Investment If this marketing implementation plan is successful, CityTarget will attract professionals and other urban dwellers. Our billboard advertising promotions for new store openings are expected to incur a cost of approximately $90,000 each (three billboards in the inner city at $2,500/month for one year). Social media promotional expenses are predicted
89 http://www.ehow.com/how_110730_rent-‐own-‐billboard.html 90 http://www.ehow.com/how_110730_rent-‐own-‐billboard.html 91 http://www.timessquarenyc.org/advertising-‐sponsorships/index.aspx#.UnxA9JTwLSE 92 https://mail.google.com/mail/u/0/#inbox/1428be39a6a46077?compose=new 93 http://www.onwardsearch.com/Social-‐Media-‐Salaries/ 94 http://www.marketingzone.com/how/advertising/typical-‐results-‐advertising?page=0,1
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to cost approximately $51,000.95 We expect promotional and technical work in the m-‐commerce division of Target to roughly cost CityTarget $10,000 for this plan96. Each community outreach event is predicted to cost $10,000. Altogether, these costs amount to $161,000 (including grand opening) for one CityTarget opening promotions. We expect revenue from this marketing plan to be approximately $500,000. Target has had similar returns on previous marketing ventures.97 The extended amount of time between the planning and execution of these promotional efforts and the financial return largely influence this figure. With these financial projections, we expect a return on investment from this marketing plan of 2.11, or 211%. We perceive this ROI to be high when taking into account that CityTarget will be newly emerging into the urban market, however the return seems plausible given the recognized Target name. The initial success of our marketing plan will give Target the ability to reinvest in future promotional mechanisms and will establish CityTarget as a profitable venture. Strong performance and continued marketing efforts will help CityTarget become a destination for everyday needs and a major player in the downtown retail market.
11.5 Key Success Factors • Brand Identity
o CityTarget will promote the unique features of this new layout o CityTarget will communicate their new focus on quality and professionalism o CityTarget will maintain their high value brand o CityTarget will maintain their position as a convenient, one-‐stop-‐shop for
everyday needs • Efficiency in marketing efforts
o Promote on sites and in locations central to professionals being targeted o Social media presence will be continuously monitored and updated o High-‐quality, simplistic advertisements to better attract target market o Cost-‐effective measures in employment of social media experts
• Fostering urban pride/city identity o CityTarget will maintain a relationship with the city in which they are located o CityTarget will continue efforts to give back to local communities o Urban pride will be fostered in store with city-‐specific merchandise o Local music will be promoted and incorporated into the store’s playlist o Local food will be incorporated in the cafe and food-‐on-‐go sections
• Performance o CityTarget will deliver on its promises by maintaining Target’s brand promise:
“Expect More, Pay Less” o Correct merchandise decisions will make CityTarget a go-‐to for professionals o Customer service and facilities
95 http://www.mackcollier.com/cost-‐of-‐social-‐media-‐in-‐2012/ 96 http://appmuse.com/appmusing/how-‐much-‐does-‐it-‐cost-‐to-‐develop-‐a-‐mobile-‐app/ 97https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Annual-‐Report.pdf
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o High quality performance with help CityTarget maintain its success
12.0 Appendix 12.1 Additional Demographics Chicago:
• 51.5% female • 23.1% under 18 • 10.3% over 65 • Median household income $47,371 • Average persons per house 2.5798 • Total population: 2,714,856 • Races: 45% White; 32.9% Black; 28.9% Hispanic; and 5.5% Asian. • 80.2% high school graduates • 32.9% Bachelors degree or higher • 1,030,746 households
Seattle:
• 50% female • 15.4% under 18 • 10.8% over 65 • Median household income $61,856 • Persons per household 2.05 • Total population 634,535 • 69.5% White • 7.9% Black • 6.6% Hispanic • 13.8% Asian • 92.4% high school graduates • 55.8% Bachelors degree or 99
San Francisco:
• 49.1% female • 13.5% under 18 • 14% over 65 • Median household income $72,947 • Persons per household 2.30 • Total population 825,863 • Race: 54.3% White, 6.1% Black, 15.4% Hispanic, 34.2% Asians • 85.7% high school graduates
98http://quickfacts.census.gov/qfd/states/17/1714000.html?__hstc=223762052.ca55c2d99e8d7470acaecb83aabc7ccb.1368625131217.1368625131217.1368625131217.1&__hssc=223762052.1.1368625131218 99 http://quickfacts.census.gov/qfd/states/53/5363000.html
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• 51.4 Bachelors degree or higher • 378,247 households100
Los Angeles:
• 50.2% female • 23.1% under 18 • 10.5% over 65 • Median household income $50,028 • Persons per household 2.82101 • Total population 3,857,799 • Race: 49.8% White, 9.6% Black, 48.5% Hispanic, 11.3% Asian • 73.9% high school graduates • 30.5% Bachelor’s degree or higher • 1,413,995 households
12.2 STP Analysis Step-‐by-‐Step Process
Step One Marketing Strategy: • Bring full target experience to a small urban setting • Be successful in growing metropolitan areas • Bring the same affordable value to customers in the city
Step Two Segmentation Methods:
• Geographic o Densely populated o High traffic o Large amount of people
• Demographics o Increasing minorities:
§ Hispanic § Asian
o Young professionals 22-‐29 o Business men and women o Lower, middle and upper class o Dual Income No Children
• Psychographic o Lifestyle
§ Fast paced § Busy § Get in, get out § Time poor society
100 http://quickfacts.census.gov/qfd/states/06/06075.html 101 http://quickfacts.census.gov/qfd/states/06/0644000.html?level=1
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§ Health conscious § Green consumers § Urban pride
o Self concept § Trendy and stylish § Happiness § A lot of friends § Successful § Cutting edge
o Self value § Hard work: control of success and career § Socially responsible
• Benefits o Convenience o Good value o Prestige o Purchase gives back to city and community o Purchase supports green business actions o Purchase supports social justice in civil rights
• Behavioral o Occasion:
§ Fresh and convenient food options § Everyday necessities
o Loyalty § REDCard § ABullseyeView.com (connects city and target with social media)
• Create different sections for each city • Foster urban pride
Step Four: Select Target Market • Undifferentiated:
o Expect more pay less o Convenience o Reliability o Health conscious o Social responsibility
• Differentiated: o Appeal to
§ Different Lifestyles • Younger: trendy, urban pride • Older: practical, nicer products
§ Different jobs Step Five: Develop Positioning Strategy
• Value=variety of products to appeal to wide variety of demographics
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• Positioning Methods: o Step One: Determine consumers’ perceptions and evaluate product compared to
competitors § High value § Convenient § Reliable
o Step Two: Identify target market’s ideal points and size § Appeal to everyone in the area
o Step Three: Identify Competitor’s Position: § Walgreens
• Well established presence with locals • Most focus on pharmacuticals • Retailer with smaller food and clothing options
§ Macy’s/Bloomingdales • Clothing, accessories, shoes • Not food • Not convenient or fast paced • High prestige102
§ Walmart • Lowest prices • Large market size because of brand • Negative connotations because of brand103
§ Farmers Markets • Simply a grocery provider • Market is low-‐income urban consumers • Loyal customers
o Step Four: Determine Consumer Preferences § Convenience § Cutting edge § Social responsibility § Urban pride
o Step Five: Select Position § Be a convenient stop for professionals for household and food needs that
delivers a high value o Step Six: Monitor Position
§ Wait and see!
102 http://en.wikipedia.org/wiki/Macy%27s 103 http://mobile.bloomberg.com/news/2013-‐03-‐26/customers-‐flee-‐wal-‐mart-‐empty-‐shelves-‐for-‐target-‐costco.html