Tuesday, August 20, 2013

Target Canada receives poor grade from shoppers...

Target arrived in Canada with a splash back in March, stirring up a buzz about its cool factor and drawing throngs of shoppers. But a new survey cited by The Globe and Mail indicates they haven't been able to live up to all the hype. Shoppers complain that its stores have been short on inventory and that prices are higher than those at its U.S. outlets.

The customer-satisfaction rating survey by Forum Research puts Target at the bottom of a list of major Canadian retailers, showing a decline from just four months earlier. Rival Walmart Canada Corp. improved from four months earlier, and Costco Canada emerged as the clear winner. Overall, the ratings broke out with Target scoring a 2.7 out of 4, compared with Costco’s 3.5, Walmart’s 3.1 and a 3.2 average.

“There was a lot of hype before Target entered the country,” Forum president Lorne Bozinoff said. “Now that people have shopped there, I think there is a bit of a letdown.” The research reflects the pressure that Target faces in its first foray outside of its U.S. home base, as incumbent retailers ramp up their own operations to take on their daunting new competitor.

So how can they fix this? Target needs to "draw more people to its stores for groceries, which tend to attract shoppers more frequently than apparel and home goods," said Amy Koo, senior analyst at consultancy Kantar Retail in Boston. In Canada, Target doesn’t have the extensive fresh food offerings it has in the U.S. And this Fall, it will be crucial for Target to lure back-to-school shoppers with its cheap-chic products, including the Sept. 15th launch of an affordable line by designer Phillip Lim.

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