Mark’s blog entry describes Target Canada’s engagement in a price war with Walmart and its American counterpart, by cutting prices in their Canadian stores, specifically a 4% lower cost in consumer goods, in order to challenge its competitors and win additional Canadian market share.
Although lowering prices has the potential to attract more consumers and boost Target Canada’s place in the market, recent articles show that Target Canada’s place in the market is a lot worse. As per the Marketing Mag article, Target has had a disastrous Canadian expansion. Not only has it fallen short on consumer’s expectations, it has also had major supply chain issues resulting in empty shelves, poor selection and customer complaints over high prices in comparison to its US stores. What’s more, Target Canada has actually lost close to US$1 billion since the expansion began in March 2013.
http://www.givemebackmyfivebucks.com/2013/05/21/target-canada-or-target-usa-which-is-cheaper/
Right now Target Canada is in the process of implementing a turnaround plan in order to regain customers’ initial expectations. However, it seems that a 4% decrease in prices is not a large enough incentive that will generate more traffic to the stores. Target Canada’s first goal should be to work fervently to regain its footing in the Canadian market and stay afloat.