David Jones

Topics: Strategic management, Retailing, Online shopping Pages: 7 (2662 words) Published: January 30, 2013
Executive Summary
In this report I discuss the comparison of competitive strategies between the two major departmental stores in Australia being David Jones and Target and how they differ from each other. I also discuss the current issues that are faced such as Global Financial Crisis that has had much impact on both stores as well as future threats such as online shopping which is believed to be the latest trend is shopping which has already affected the stores but could make competition even tougher in the near future for both stores.

Target Stores is a major retail store that first opened in 1925 in Geelong as Lindsay’s Emporium selling from clothing to household goods, appliances, sporting goods, toys etc. From that date opened a few other stores around the country until really beginning to expand in 1973 when they become known as Target with now 305 stores across Australia. The aim of Target stores is to provide Australians with great quality at an affordable price. David Jones on the other hand is aimed at a higher class of people as their products come across more expensive than Target. David Jones stores began in 1838 but only currently have 37 stores across Australia Both Target and David Jones face competition within the retail market with Targets main competitor being K-Mart and Big- W while David Jones’ main competitor is Myer. Both stores have strengths and weaknesses and both hold different competitive strategies as Target shows a focus on cost leadership while David Jones follows a differentiation leadership. The rest of the report will look into strengths, weaknesses and the different competitive strategies with more detail.

Finding Analysis
As previously mentioned Target first opened in 1925 but did not become Target Australia Pty Ltd until 1973 when the opportunity for growth was recognised. From there Target expanded to Target Home, Target Country and Target Baby which all are a part of the Westfarmers group. Target has a large range of products which include menswear, ladies wear, kids wear, sporting goods, appliances, household goods, toys, electrical, etc. The extension of Target home and Target Baby was not necessarily a positive move by the company as many of these stores closed down shortly after as it was not seen to increase sales or profits. Over the past 10 years Target has attempted to become more ‘in’ with the current trends by keeping up with other well known stores such as Jeans West, Sportsgirl, Jay-Jays etc, but by offering a more affordable price that these stores. The main target was between young teens and early 30s as it was believed these young Australians can be stylish for a much more affordable price. This change in market position came after Target announced its first loss in 2001 of $43 million and a new senior management were put in place. This was seen to improve the financial revenues from a loss to a profit within 18 months. Target face a fierce competition in which they must take into consideration and differ from these if they are to remain a strong competitor in today’s retail industry. The two main competitors are K-mart and Big W. K-Mart is also a part of Westfarmers where as Big W is owned by Woolworths which is Westfarmers greatest threat. Target attempts to be more attractive to Australians by offering such low prices but still providing great quality in their products. Target must sustain this quality if they are to remain strongly in the market as if product quality deteriorates then customers will find a new place to purchase their goods. Another competitive strategy that Target hold is the range in different products they hold. In comparison to a retail store like Jeans West, customers can purchase stylish clothes in the same shop that they can purchase toys, appliances, etc, which makes Target extremely attractive for families during the Christmas period when shopping can become such a hassle...
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