MINNEAPOLIS–Target is “dialing up” the value message, the retailer’s executives said at a meeting with the financial community yesterday.
“We’re emphasizing the ‘pay less’ side of our brand promise,” said Kathy Tesija, Target’s executive vice president of merchandising.
To offset gross margin declines and reduce clearance markdowns in discretionary categories such as home, which has slowed recently, Target has implemented a price management system to determine the right markdown at the right time.
Still, ‘best’ products in the good-better-best equation, such as the Smith & Hawken furniture line, continue to sell well, she said.
Exclusive designer brands will become a bigger part of Target’s mix, as well as limited-edition collections, such as a new collection of decoupage plates from designer John Derian.
Target will also shout the value message in marketing at both the store level with signage, end cap displays, and in its advertising campaigns.
Three-quarters of Target’s advertising spend today is devoted to communicating value with its shoppers, who are in “economic pain,” said Michael Francis, vice president and chief marketing officer.
To that end, the retailer launched the “for less” advertising push last month.
The low-price push will be a cornerstone of Target’s holiday campaign, which will include advertising hooks such as top gifts under $25, executives said.