The devil is in the details: exacting standards keep home departments fresh

Discount Store News, April 1, 1997

Home is where the heart is, and even Target is not immune to hardening of the arteries. Compared to other discount store chains, Target has stood alone in consistently delivering trend-right home furnishings in an upscale/value retail environment. This is no time for the chain to rest on its laurels, however.

With a market share-hungry Kmart unleashing the Martha Stewart program across linens and home decor categories, with regional discounters going all-out to upscale their merchandising and with Wal-Mart continuing to grow its domestics sales even at the expense of soft lines leader JCPenney, today Target faces stronger, more fiercely directed competition on all fronts.

Of course, there is still a lot of smart money betting on Target.

"They can put together more on-trend fashion assortments than any mass merchant," said John Witkowski, vp, Chapel Hill. "They are always open to fresh new developments."

Where a Wal-Mart or Kmart can be a good partner, neither has the reputation for performing on Target's level when the measurement is how fast the chain gets on board with a fully executed trend-driven program.

"Target has the ability to react quickly, moving into large assortment changes," Witkowski said. He recalled a decision several years ago by Target merchants to develop--virtually overnight--a department for tab-top window treatments. "I watched them go from zero feet to 40 ft. in tab tops. They picked up the trends, put hard merchandise in with it. I watched other chains struggle to put that program together. Target got the right product in front of the consumer."

Quite often, Target gets the product trend right and gets more mileage out of it by presenting it under its own private label programs. Under the umbrella nameplate of the At Home Collection, Target merchandises families of business with a variety of labels, including Trend Basics, Furio and Windsor & Browne.

Suppliers agree that compared to other mass merchandisers, Target tends to be more demanding about some of the things its competitors may treat as lower priorities, such as standards for private label packaging. Nevertheless, few take exception to what has proven to be a winning formula.

"It's a great retail environment," said one rug vendor. "They are the class act of the discount retailers. They are focused; when they see something, a trend they think will fly, they'll jump on it."

For the past several fashion seasons, Target has used an innovative means to get the big picture and at the same time to zoom in on those vendors providing the best looks. Assembling key suppliers in a Minneapolis hotel, Target assigned space to each, and asked the vendors to display their wares together, coordinated by styles, colors and patterns. This has allowed the retailer's buyers to size up the best floral patterns, or the best blue-and-white combination, and to get its orders in fast.

Target is faster in logistics as well, moving shipments onto the floor without delay. Once they hit the floor, products are generally presented in a cleaner way than one is likely to encounter at other discount chains.

Examples of this presentation focus are especially strong in housewares. In the clock category, for instance, Target's planogram places private label and licensed items along a full gondola, providing the kind of statement that builds confidence among shoppers.

In seasonal serveware, Target uses its Destination Sun departmental label to help pull together plastic picnic goods. Here, the color palette of the gondola-top running signage tends to gel with the color schemes in the product lines.

In ready-to-assemble furniture, Target shows customers that if they don't know how to fill a room with coordinated looks, no problem; Target's designers have done the job for them, assembling related styles for casual home living in the den, the home office, the bedroom and kitchen. The four-color photographs on the Furio labels make plain how the items will look in shoppers' homes, easing the connection for the consumer.

In lamps, Target uses a simple number-code matching systems to help shoppers combine lampshades with bases. The system not only saves Target money in housekeeping the display, it encourages the shopper to get involved in piecing together a look.

"They make it very easy for the consumer to see they believe in something," said Tom McCaffrey, vp, children's lines, The Bibb Co. "Even with solid color lines, they make a clear statement. And they are not afraid to step up on the accessories; they tend to do more coordination."

This confidence leads to more margin dollars because there tends to be more profit built into accessories. In addition, various suppliers said Target operates on a higher initial markup than Wal-Mart or Kmart.

As a vendor that is heavily involved in entertainment licenses, Bibb has seen closeup Target's prowess in cross-merchandising. Whether it is Warner Bros.' Batman or Disney's Lion King, Target has broken ground with opportunity carts that tune shoppers in to the offerings of various departments around the store. Once in the individual category areas, consumers are apt to find good execution of signage packages for the licensed properties.