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Unrealistic Expectations Hampers Target Rollout


Target reported last week its profits had been slashed for Q3, partly due to a chilly reception from Canadian consumers after its nationwide expansion of 124 stores over the past year. Will it be able to recover?


Profits fell 46% for the quarter, the Minneapolis-based retailer reported. Two big issues for Target up here have been empty shelves and pricing. Many Canadians were looking for the same prices found in US Target stores. Canadians also don't seem to be going into the stores for basics like food and medicine. But don't sell them short in Canada just yet, Vancouver-based retail consultant David Ian Gray tells us. "They have had a dose of humility, as other US chains have had in the past here," he says. "But they are strong and determined."


We know it looks empty at this Delta store, but in actuality, all the customers just rode to the store in shopping carts. "The rollout has been underwhelming in part because of the unprecedented media hype in advance of its launch, generating unrealistic expectations," David adds. Like many retailers, Target underestimated the market challenges and competitive environment in Canada. Smoothing out their logistical challenges over the next year will help, David says.

Related Topics: David Ian Gray, US Target