Target: Responding to the Recession
Posted: 17 Mar 2012
Date Written: March 12, 2010
Within 10 months of Gregg Steinhafel's taking over as CEO at Target, the U.S. was mired in the most significant economic downturn in 50 years. Top competitor Wal-Mart had positioned itself well for the crisis, while Target's same store sales began to slide. While Steinhafel believed that Target's long-term strategy and positioning were right, he pondered a set of strategic and operational challenges. Did Target have the right mix of offensive and defensive tactics to weather the downturn and position itself for the economy's eventual recovery? How far could Target go in emphasizing low price-the "pay less" side of its slogan-without eroding the company's core promise of offering unique and upscale products that customers would not see at other low-priced retailers? Would the benefits of adding fresh food to Target's general merchandise stores outweigh the associated challenges?
Learning Objective: To examine and debate the strategies Target adopted to respond to the economic downturn in 2008.
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