Target wants to shake off its budget image and become a cool brand among the teens and tweens.
Target managing director Dene Rogers outlined the plans as part of the retailer’s turnaround strategy.
Mr Rogers said he envisaged Target filling the gap between top-tier department stores, such as David Jones and Myer, and budget stores.
“Relative to the North American market, we see an absence of retailers in Australia above the big discounts and below the department stores and that’s the space that we’re looking to occupy,” he said.
“Our vision is to become that leading mid-tier department store.”
Ms Rogers was speaking an investor briefing hosted by Target’s corporate parent, Wesfarmers. Other strategy updates included those from wholly owned subsidiaries Coles, Bunnings, Officeworks and Kmart.
Coles managing director Ian McLeod told investors that the supermarket giant planned to increase its floor space by two per cent each year as it continued its battle with Woolworths.
Coles expects to open 19 new stores, close eleven, and extend 10 stores in the 2011/12 financial year. Up to 400 stores are set to be refurbished.
And Bunnings customers will soon be able to buy modular homes from $19,900 from the do-it-yourself retailer.
Bunnings managing director John Gillam said modular homes ranging from 35 square metres to 94 square metres would soon be available.
But Target was the main focus. Its four-year turnaround plan was to combat new competitors from overseas, such as Zara and Top Shop, as well as online retailers.
The strategy focused on improving the quality of Target’s products and in-store services.
New customer offering included use of 3D technology to ensure the correct fit for women customers confused about their clothes size.
A bra fitting service would bring Target in line with other department stores such as David Jones and Myer.
Mr Rogers said Target intended to increase sales of its children’s clothing range, particularly among those aged five to 16 years.
He said sales of children’s and teenagers’ clothing at Target dropped off after the age of five when children started school and become more brand conscious.
“That’s probably explained by the fact that when children go to kindergarten they start to face peer group trends … they start to develop that independence,” he said.
“That accelerates into the teen years.”
In order to combat the children and youth market’s poor perception of the Target brand, the store was planning to pitch its message directly at them.
“We need to communicate and build a relationship with kids and we can’t do so using the catalogue, not many kids read our catalogue,” Mr Rogers said.
“So we’re looking to develop marketing tools that enable us to build a relationships with kids.”
Shares in Wesfarmers were six cents weaker at $28.95 on Wednesday.
