Pricing and Promotion Strategies - Home Goods and Target
The pricing strategy of HomeGoods is to offer brand name products at prices 20-60% below other department stores, while the strategy of Target is to offer low-priced store-exclusive brands. The target consumer of HomeGoods is middle to upper-middle income fashionable females, while Target's target consumer is upper-lower to middle income young families.
- HomeGood's offers well-known, top brands at discounts of 20-60% below other department stores. They do not focus on sales or discounts on top of their already-discounted prices.
- The pricing strategy of HomeGoods and other TJX stores has not changed since 2016.
- The strategy is working, with TJX, the parent company of HomeGoods, predicting that it could potentially double the number of HomeGoods stores in the future.
- The target customer for TJX, the parent company of HomeGoods, is a fashionable, value-conscious, middle to upper-middle income female between 25-54 years old.
- Target's pricing strategy is to offer low prices as well as exclusive, stylish brands.
- After poor results in the wake of the 2008 recession, Target shifted their strategy in 2016 to improve in-store customer experience, to offer more Target-exclusive brands, to target younger consumers, to improve the online segment, and to lower prices.
- The strategy is definitely working, with Target reporting positive financial results, beating analyst expectations, and holding its own compared to its competitors.
- Target's target audience is young families with some discretionary income.