Although the Brand Channel post I discussed in my earlier post was about The Bay’s response to Target’s entrance into Canada, I wanted to follow up with a further look at how Target’s marketing strategy may be significantly different from The Bay’s. Target, with its lower prices and more household-oriented product mix including groceries and other food items, will attract more families as well as generally a younger demographic compared to The Bay. Target’s chief merchandising officer described Target’s “target” market as “Young, active, well-educated and with children at home,” while The Bay seems to target more affluent and older individuals, as suggested by its positioning as having a “reputation for service, quality, and more than ever, for style.” Furthermore, The Bay has an advantage in its current placement; its long history means that it has secured prime properties, such as its massive store in the heart of downtown Vancouver. For Target to steal a large amount of The Bay’s higher-end clientele, it would have to find properties comparable in both size and location.
So if not The Bay, who should feel most threatened by Target’s move into Canada? Barclays has identified Sears Canada, Old Navy, Loblaw’s Joe Fresh brand and Canadian Tire as the stores most endangered by Target. Sears in particular offers similar product types as Target, are located near the Target stores’ Canadian locations, and lacks the other advantages that Target has, including its unique designer lines, partnership with Starbucks, and innovative promotional tactics. Target seems ready to take advantage of the weakness of some of its competitors and gain significant market share in Canada as it continues to open stores this year.