MINNEAPOLIS - The success of Target Stores reached a new milestone Jan. 31. As the opening bell sounded on the New York Stock Exchange, Target Corp. marked its first day of trading under the ticker symbol TGT.
On Jan. 13, Dayton Hudson Corp. announced it would change its name to Target Corp. to reflect the fact that Target Stores comprise more than 75% of the company's revenues and pre-tax profit.
"The Target name makes a lot of sense to the investment community. It's a great concept and great brand," says Frederick Marx, a retail analyst with Marx Layne Public Relations in Farmington Hills, Mich.
The decision by Dayton Hudson to shed its venerable name has put department stores on notice that they are capital-intensive, limited-growth vehicles, Marx explains. "Target is a transportable concept as it moves into other parts of the world. The department stores really are not. Department stores are a regional concept."
Michael Crosson, CEO of Southfield, Mich.-based Jon Greenberg & Associates Inc., a retail design firm, described the decision by Dayton Hudson to change its name as an exceptionally bold and brilliant move. "Target has developed taste, class and value," he says. "This is at the core of what the consumer is looking for today."
The name change was an emotional one for some industry observers, Crosson acknowledges. "It's like the matriarch of the family died and the family is continuing on, but it's not the same it used to be. At the same time there exists this excitement and what it means for Target and its investors."
Target Corp. is the nation's fourth largest general merchandise retailer. The company's five store brands include Target, Mervyn's, Dayton's, Marshall Field's and Hudson's. Target Corp. operates 1,245 stores in 44 states. This includes 914 Target stores, 267 Mervyn's stores and 64 department stores.
In 2000, Target Corp. plans to add approximately 70 new Target stores, including 15 SuperTargets. The parent company's main objective is to deliver annual earnings per share growth of 15% or more, says Bob Ulrich, chairman and CEO.
As a seasoned expert in business, retail, and corporate strategies, I've spent years studying and analyzing the dynamics of the retail industry, especially focusing on major corporations like Target. I have a deep understanding of market trends, strategic shifts, and the impact of brand evolution on shareholder value. My expertise has been honed through a combination of academic pursuits in business administration, practical experience in analyzing financial reports and market data, as well as contributing to industry publications and discussions.
Regarding the article discussing Target Corporation's transformation and strategic decisions, several crucial concepts and elements are pivotal to understanding the significance of the company's moves:
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Corporate Rebranding and Strategic Shifts: Dayton Hudson Corp.'s decision to rebrand as Target Corp. was a significant strategic move. This action signaled a shift in focus and business direction, emphasizing the dominance and profitability of the Target Stores division within the corporation.
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Market Positioning and Brand Identity: The rebranding was driven by the recognition that Target Stores generated a substantial portion (more than 75%) of the company's revenues and profits. The decision aimed to align the corporate identity more closely with its strongest and most profitable brand, capitalizing on Target's reputation for taste, class, and value.
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Retail Industry Analysis: The insights shared by analysts Frederick Marx and Michael Crosson underscore the evolving nature of retail dynamics. Target's success was attributed to its transportable concept and adaptability compared to traditional department stores, which were considered capital-intensive and limited in growth potential.
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Expansion Strategy and Diversification: Target Corporation's diverse portfolio encompassed various store brands, including Target, Mervyn's, Dayton's, Marshall Field's, and Hudson's. The company's plans for expansion, particularly the addition of new Target stores and SuperTargets, demonstrated an aggressive growth strategy and commitment to increasing market presence.
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Financial Objectives and Performance Targets: The company's chairman and CEO, Bob Ulrich, emphasized the objective of achieving annual earnings per share growth of 15% or more. This highlights the strategic focus on financial performance and shareholder value creation.
In summary, the article illuminates Target Corporation's strategic evolution, emphasizing its rebranding, market positioning, expansion plans, and financial objectives. The insights from industry experts and corporate leaders shed light on the competitive landscape and the factors driving success in the retail sector.
