Random thoughts on retail

An interesting value proposition put forth by Target this week seeks to entice shoppers in the challenging home category by asserting, “Only you’ll know how little you paid.” The implied message of fashionably affordable products is consistent with Target’s “expect more, pay less” value proposition and the timing makes sense as well. The kids are back to school, and temperatures have dipped in most parts of the country. Soon, “she” will be thinking about the condition of her home and its furnishing in anticipation of entertaining holiday visitors.

Unfortunately for Target, consumers’ perceptions of value with regards to the home category have been altered by an abundance of clearance activity at less efficient retailers or those desperate to clear inventory because they need cash.  Such actions create an irrational competitive marketplace and make it challenging for Target to sell full price home furnishings. As far as the premise that no one will know how much you paid. Don’t kid yourself. The quality of home furnishings available at Target and other mass retailers has come a long way over the past decade thanks direct sourcing, but everyone will know how little you paid because the quality still leaves something to be desired.