Target's CEO wrote a letter to key national brand vendors asking for their help in combating online retailers.  Target's ask is for lower prices and differentiated product to prevent consumers from comparison shopping and buying on-line.  The big box retailer wants to eliminate "showrooming," when consumers evaluate a product in a Target store but buy it, often at a lower price, online.

I am an avid Target shopper, a former Target employee, and a holder of a very modest amount of Target stock.  I am disheartened by Target's request of its vendors.  As consumer behavior evolves to on-line shopping, Target's request suggests that it is relying on what worked in the past.  Target lovers want to see Target evolve by fix its website issues and making shopping in stores better and more fun.

The assertion that differentiated product with special features will prohibit consumers from comparison shopping is condescending.  People talk to their friends and online.  Folks won't be so wowed by a different color of vacuum cleaner, an extra attachment for a blender, or a different size of detergent that they will blithely buy at Target.

Furthermore, I question the soundness of a differentiation strategy on national brand items for consistently delivering great prices.  In my experience with CPG companies, exclusive items typically fly in the face of lower costs.  The products require special packaging, smaller runs, more changeovers at the factory, special inventory, and so on.  All of this increases costs to the manufacturer and in the end to Target.  Finally, I question if Target can get additional features that are really meaningful to consumers.  After all, if the feature or benefit was truly a compelling, manufacturers would launch it nationwide.

Consumers are pretty sharp.  Give the consumer some credit, and focus on making Target a the best place to shop for what consumers want to buy there.  Perhaps Target needs to charge a membership fee to shoppers.  Maybe it should post competitive prices in the store to demonstrate to shoppers what a great deal Target offers.  Or it could focus on converting "showroom" browsers into buyers of other products that don't lend themselves to online purchases.  What do you think?