Target Canada’s Web woes
Across Canada, newbie retailer Target Corp. has helpfully dotted neighbourhoods nearest to its stores with giant, colourful billboards to herald their openings, visible from afar and stamped with the merchant’s distinctive bullseye logo.
It’s a reminder the mass merchant hopes will encourage Canadians to check out the goodies it alone offers in this market: limited edition designer fashion collections, popular private brands and home décor lines. The retailer has also run colourful and stylish TV ads, staged fashion shows and delivered millions of flyers to houses across the country to showcase its weekly sales specials and exclusive products.
But there is one conspicuous and important tool missing from Target Canada’s marketing toolkit, particularly in a country known for heavy Internet usage: a website that shows much of what it sells.
In today’s “clicks and mortar marketplace,” in which 49% of Canadian Internet users shop online monthly and many of them peruse a retailer’s selection of goods on their phones or home computers before they set foot in a store to buy, lacking a website showing goods and prices — especially when retail rivals Sears Canada Inc., Wal-Mart Stores Inc., Hudson’s Bay Co., Costco Wholesale Corp. and Canadian Tire Corp. already do it — is a problem Target can’t afford to have.
“If you are going to be competitive in a marketplace, why stay out of a business segment that is growing faster than anything else in the marketplace?” says George Minakakis, chief executive at the Toronto-area consulting firm Inception Retail Group.
A survey last month from PricewaterhouseCoopers Canada found that 34% of Canadians always research clothing and footwear online before they enter a bricks and mortar store to buy, and 52% do so for home appliances.
“Organizations that would spend so much of their marketing dollars trying to influence you to come into the store and have a certain type of experience now realize that they should try to influence you with respect to a particular product or brand prior to making a purchasing decision,” said Ted Salter, a partner in consulting and deals at PwC Canada.
The survey asked Canadians why they shop at their three favourite retailers, and 81% of consumers responded they do so because they can check the in-store availability of a product online, and find that the items they want are usually in stock.
Retail experts acknowledge that Target Canada arguably has enough on its plate right now without debuting a website — the retailer lost $941-million setting up shop in 2013, attempted to execute a turnkey beginning for brand new pointof-sale, distribution and logistics systems, trained a new staff of 20,000 and then wrestled through trying to clear out a glut of inventory after sales failed to live up to initial expectations.
The hurdle is unique to this era, one Wal-Mart, for example, didn’t face in 1994 when it entered this country in a similarly sizable way, buying up and supplanting 122 Woolco stores.
But while not tackling Web selling out of the gate in Canada may have been a wise business decision for Target, it might not be the most prudent decision for a company keen to draw in consumers accustomed to treating retailers’ websites like catalogues.
“Target likely does not have the resources — and by that I mean
What will the fallout be if it takes too much longer for them to get there?
mostly time — to adequately address the Web, which is a huge undertaking,” Mr. Minikakis said. “The question is, what will the fallout be if it takes too much longer for them to get there? If they wait another year, I think you could argue that it would be too late. They are missing out on a prime opportunity to connect with consumers.”
Comparing Target’s websites in the U.S. and Canada can prove to be an exercise in frustration for some. Beyond a few tantalizing pictures and some rare product prices, Target. ca stands in sharp contrast to the retailer’s fulsome Target.com website.
“I guess if a company can’t spend the money for a website that gives a strong impression of the products they carry, well we shouldn’t be surprised that we’re disappointed when we get into the store,” read a recent comment from customer Judy Danelley on Target’s Canadian Facebook page.
“Take a look at Target.ca then compare it to Target.com. If a business is going to enter a new area ... hey you have to come in full force and make an impression ... not come in like a sniffle and spend the next decade trying to convince people that their next visit may not be as disappointing as their first.”
Target Canada spokeswoman Lisa Gibson is keen to emphasize that the retailer’s Web strategy is in the works, but could not give a timeline for when the Target.ca website may offer more information.
“Now that we are in a run state with the stores, the marketing team is certainly evaluating digital strategy and what makes the best sense for Canada,” Ms. Gibson said. That may be a catalogue-style website that shows products and prices or a fully transactional sales website.
“I don’t have exact timing to share, but I can tell you it is a matter of when, and not if,” she said. “We get questions asking about when we will bring e-commerce to Canada.
“Certainly, I think there is an appetite for even more information in Canada.”
Meantime, Target is reaching out to online consumers in Canada through social media channels such as Facebook and Twitter, where it has sizable followings, in order to showcase its products and do spot promotions.
In today’s hyper-competitive retail marketplace, traditional marketing tactics such as flyers, billboards, loyalty programs and in-store product presentation are all key ingredients of a larger marketing stratagem that includes the Web, social and mobile channels, Mr. Salter said. “If you don’t have those capabilities extended in all of the different channels, then you are going to miss out on that opportunity to influence consumers when they are going through that selection process.”