Blake Ulves
Dr. Decker
11/25/2012

Target Corporation

With old channels of businesses being taken over by the online distribution network, Target has become susceptible to the same fate that blockbuster had experienced in the movie rental business. The videogame industry was quickly following film in the sense that content would begin to be distributed electronically. In order for Target to future-proof itself for the next 5 years, it must re-align its corporate and management strategy policies. There is no doubt that Target should begin distributing videogame software through its online channel. But there is still a market for the retail customer. This is why I believe that a next-generation hybrid of both online and offline sales is the best option for target. By giving the customer the convenience of ordering items online and picking them up in store or vice versa, could create a core value proposition for its future videogame shoppers. There could be a possible integration of a customer using their mobile device in the retail stores to scan items, which directs them to the online store for more customization options and delivery options to the home. With this they can also implement more payment options such as Paypal© or Billmelater©. With these two payment options, Target could possibly migrate to a mobile POS (point of sale) within their stores all from a customers mobile phone. Value creation for the target customer is the first step in creating an effective corporate strategy. “Value creation is the ultimate purpose of the corporate strategy” (Corporate Strategy 10).

Target can build up its sustainable advantage through the coherence of its retail, mobile, and online distribution channels. Hard core video gamers want instant connection the videogame product. In Corporate Strategy coherence is emphasized as essential to a corporate advantage. “Corporate office must design systems and processes that ‘support a given organization structure that provide coherence to the activities of the differentiated business units. It is critical to the effective implementation of any corporate strategy. If the corporation cannot be organized to leverage valuable corporate resources across the divisions, It will not be able to justify its existence as a multi-business corporation.” (175) Target should tap into this in all three channels in order to curate the advantage over its competitors. To successfully integrate this marketing model into its new business, it is important that Target pilots this program on a smaller scale. Peter Drucker asserts that a window of opportunity for innovation is rooted within piloting. Piloting can be very effective, even if the pilot does not work as intended, it can still be learnt from. He adds “It is almost a ‘law of nature’ that anything that is truly new, whether product or service or technology, finds its major market and its major application not where the innovator and entrepreneur expected, and to be the use for which the innovator or entrepreneur has designed it. And that, no market or customer research can possibly discover.” (Drucker 403) In order for target to reach this new retail format, Target must focus its future investments into the mobile and online world. Hardcore gamers are deeply imbedded in the online community. By investing its marketing activity in this area and showing the hardcore gamer consumer that target is also part of this culture. It will create a brand loyalty. The encroachment of competition upon Target is inevitable; eventually Targets competitors will begin to follow its successful operations. Corporate strategy states that although a corporation sees the constant threat of imitators and innovators. It must earn its Schumpeterian rents while at the same time search for new revenue streams. “… Given these threats, managers are well advised to conceive of strategies for confronting the eventual sting of Schumpeterian competition. Their