TARGET

CORPORATION
CASE STUDY
Joel Allman | Bryan Bronchik | Kendra Royal

Indiana University – Purdue University at Indianapolis

School of Informatics and Computing
INFO B585 Biomedical Analytics
Saptarshi Purkayastha
9-NOV-2016
 Agenda

Company Overview
• Financial Information
1 • Competitors
• Timeline

2 DELTA Framework & Analysis

3 SWOT Analysis

4 Recommendations
 Company Background

Target , the second largest discount retailer in the US, is an

“upscale discount retailer that provides high-quality, on-trend
merchandise at attractive prices in clean, spacious and guest-
friendly stores.”
Purpose
Purpose &
& Beliefs
Beliefs Overview
Overview Product
Product Categories
Categories
“We
“We fulfill
fulfill the
the needs
needs and
and fuel
fuel •• Founded:
Founded: •• Groceries
Groceries
George
George Dayton
Dayton •• Electronics
Electronics
the
the potential
potential of of our
our guests.
guests. 1902-Dayton
1902-Dayton Dry
Dry Goods
Goods Co.
Co. •• Apparel
That
That means
means making
making Target
Target 1962-Target
1962-Target Apparel
their
their preferred
preferred shopping
shopping •• Office
Office Supplies
Supplies
•• Headquarters:
Headquarters:
destination
destination by by delivering
delivering Minneapolis,
•• Toys
Toys
Minneapolis, MN
MN
outstanding
outstanding value,value, •• Household
Household Essentials
Essentials
•• Nickname:
Nickname: "TAR-ZHAY"
"TAR-ZHAY"
continuous
continuous innovation,
innovation, and
and •• Pet
Pet Supplies
Supplies
•• Stores:
Stores: 1,774
1,774 (US)
(US) •• Home
an
an exceptional
exceptional guestguest Home Furnishings/Decor
Furnishings/Decor
experience •• Distribution
Distribution Centers:
Centers: 37
37 (US)
experience — — consistently
consistently (US)
fulfilling
fulfilling our
our Expect
Expect More.
More. Pay
Pay •• Employees:
Employees: 341,000
341,000
Less.®
Less.® brand
brand promise.” 
promise.”  •• 2015
2015 Revenue:
Revenue: $73,226
$73,226 (bi)
(bi)
•• Website:
Website: www.target.com
www.target.com
Total Segment Sales Financial
$73.8 Billion Highlights

Stock Price (TGT): $67.05

Financial Information
 External Environment

WALMART
WALMART SEARS
SEARS
TARGET
TARGET AMAZON.COM
AMAZON.COM
STORES,
STORES, INC.
INC. HOLDINGS,
HOLDINGS, INC.
INC.

#6 Retailer #1 Retailer #8 Retailer #20 Retailer

www.target.com www.walmart.com www.amazon.com www.searsholdings.com

Revenue $73,226,000 $353,108,000 $61,619,000 $22,129,000

• Stores: 1,774 • Stores: 5,182 • Stores: NA • Stores: 1,611

• Distribution • Distribution • Distribution • Distribution
Size Centers: 37 Centers: 150+ Centers: 104 Centers: 28+
• Employees: • Employees: • Employees: • Employees:
341,000 1,500,000 230,800 178,000

Global LOW MEDIUM HIGH LOW

Presence Intl.target.com, 28 countries, 76 countries 306 Canada,
India 6200 locations 66 Mexico,
 Timeline

1902 1962
Dayton Dry 1st
Goods Co. Target

1960
1960 Transitioned
Transitioned
to
to discount
discount
store
store chain
chain

1960
1960 Opened
Opened 11stst
distribution
distribution
center
center

1967
1967 Expanded
Expanded
nationally
nationally
 Timeline

1974 1988

1974
1974 Used
Used 1988
1988 Unveiled
Unveiled UPC
UPC
1979 planograms
planograms scanning
scanning
1979 Achieved
Achieved $1$1
billion in
billion in
annual
annual sales
sales

Planogram
Planogram UPC
UPC
The planogram, a diagram that The Universal Product Code
shows how retail products (UPC), a barcode that uniquely
should be placed on shelves to identifies each product with a
maximize sales, was Target’s 12-digit number, was Target’s
first use of strategic tools in first electronic means of
the area of visual capturing data with scanning
merchandising. systems .
 Timeline

1994 2000

1994
1994 Unveiled
Unveiled 2000
2000 Released
Released
1995 brand
brand 2001
2001 Operated weekly
weekly ad
ad
1995 Launched
Launched Operated
Target.com promise
promise Target.com
Target.com Target.com
on
on AWS
AWS 2005
2005Exceeded
Exceeded
1995
1995 Offered
Offered $50
$50 billion
billion in
in
credit
credit cards,
cards, annual
2007
2007 Introduced
Introduced annual sales;
sales;
gift cards,
gift cards, credit Established
credit card
card Established
registries
registries Target
Target India
India

Expect More. Pay Less.®

 Timeline

2010 - 2012 2015

2013 - 2014

2010
2010 Presented
Presented at
at 2013
2013 Introduced
Introduced
2010
2010 Selected
Selected Conference;
Conference; 2014
2014 Launched
Launched coupon
coupon app,
app,
Emnos
Emnos for
for Relaunched
Relaunched Cartwheel
Cartwheel subscription;
subscription;
customer
customer –– Target.com
Target.com digital
digital Innovation
Innovation
centric
centric savings
savings app
app Center;
Center;
insight
insight Experienced
Experienced
2011
2011 Slowed
Slowed data
data breach
breach
growth
growth 2014
2014 Enabled
Enabled
2010
2010 Planogram
Planogram cards
cards with
with
Optimization
Optimization chip-and-pin 2014
2014 Piloted
Piloted eBay
eBay
chip-and-pin
and
and Space
Space 2012
2012 Included
Included in
in technology; global
global
technology;
Optimization
Optimization NY Times
NY Times Acquired shipping
shipping
Acquired
provided
provided by
by article;
article; Powered program
program
Powered
SAS
SAS Expanded
Expanded Analytics
Analytics
mobile
mobile
presence; 2014
2014 Launched
Launched
2011 presence;
2011 Expanded
Expanded Implemented Wish
Wish List
List
Implemented
into
into Canada
Canada app
app
Teradata
Teradata
 Timeline

2015 2016

Created
Created guest
guest Broadened
Broadened
Created
Created data,
data, center
center of
of excellence
excellence Launched relationship
relationship with
with
Launched
analytics,
analytics, and
and BI Wonderlist GroupM Media
GroupM Media
BI Wonderlist gift
gift
center of excellence Explored guide Business
Business
center of excellence Explored use
use of
of guide
RFID
RFID and
and Beacon
Beacon
technology
technology in
in stores
stores Tested
Tested new
new look
look in
in
Opened
Opened Cyber
Cyber Consolidated
Consolidated stores
stores (LA25)
(LA25)
Fusion Center
Fusion Center mobile
mobile and
and desktop
desktop
Enabled
Enabled target.com
target.com sites
sites
Equipped
Equipped stores
stores international
international sales
sales
with
with secure chip
secure chip with
with Borderfree
Borderfree
card
card payment
payment
technology
technology Began
Began shopcurbside
shopcurbside
.com pickup
.com pickup
Invested
Invested $1
$1 billion
billion
in
in technology areas
technology areas Shut
Shut down
down Canadian
Canadian
operations
operations
 DELTA Maturity Model

ANALYTICAL COMPETITORS
5

ANALYTICAL COMPANIES
4

ANALYTICAL ASPIRATIONS
3
LOCALIZED ANALYTICS
2 ANALYTICALLY IMPAIRED

Data Enterprise Leadership Targets Analysts

 DELTA
ANALYTICAL COMPETITOR

Pregnancy
Pregnancy Algorithm
Algorithm • Demonstrated passion for leveraging insights
gained through analytics
Background
Background • Strategic use of large quantities of different types
Father
Father gets
gets mad
mad after
after Target
Target sends
sends
teenage
of data from multiple channels (e.g., online,
teenage daughter
daughter promotional
promotional mailers
mailers
for
for pregnancy/baby
pregnancy/baby products
products based
based on
on
mobile, in-store)
an analysis of customer data.
an analysis of customer data. • Remediation of security vulnerabilities exposed in
data breach (e.g., new leadership, new POS
Methodology
Methodology terminals, chip-and-PIN cards, data sharing
•• Identified
Identified data
data set
set initiatives)
•• Looked
Looked for buying patterns
for buying patterns and
and
behaviors
behaviors • Connection of organizational objectives to data
•• Create
Create action
action items
items based
based on
on across the enterprise
analysis
analysis
• Employment of experienced individuals to ensure
Organizational
Organizational Value
Value
usability of data to meet business needs
•• Increase
Increase sales
sales • Partnership and collaboration with key vendors of
•• Provide
Provide competitor advantage
competitor advantage
•• Strengthen
data-related technologies (e.g., Teradata, Hadoop)
Strengthen customer relationships
customer relationships
 DELTA
ANALYTICAL COMPANY

Guest Center of Excellence is designed Pockets Of Success Achieved

MARKETIN
MARKETIN
&
SALES &

to enable the organization to develop a

SALES

greater sense of advocacy and

G

empathy for the consumer in the

retailer’s business decisions.

A distribution infrastructure enhanced ENTERPRISE

ENTERPRISE
IT
IT STRATEGY
STRATEGY
SUPPLY
SUPPLY

to reduce the complexity of its

CHAIN
CHAIN

operations, through the use of data DRIVES

DRIVES
across the supply chain, to deliver a ANALYTICAL
seamless experience for guests.
ANALYTICAL
VALUE
VALUE

HR positions focused on benchmark

RESOURCE
RESOURCE
HUMAN
HUMAN

analysis and the development of metrics

to ensure competitive compensation and
SS

benefit packages to attract highly

qualified talent. Potential of Analytics Validated
 DELTA
ANALYTICAL COMPETITOR

Keith
Keith Colbourn
Colbourn • Prioritization of the development of an analytic
Senior
Senior Vice
Vice President,
President, Loyalty
Loyalty culture and analytical capabilities throughout the
& organization, especially in leadership
& Lifecycle
Lifecycle Marketing
Marketing
• Recruitment of strong leaders, many from
“Colbourn
“Colbourn will
will lead
lead competitors, who are subject matter experts in
the
the development
development of of business intelligence and analytics
data-driven
data-driven
marketing
marketing strategies
strategies • Presentation of analytic techniques at industry
that
that drive
drive traffic
traffic and
and sales,
sales, conferences (e.g., Andrew Pole’s keynote at
deepen
deepen brand
brand engagement
engagement and and Predictive Analytics World in 2010 titled, “How
build
build guest
guest loyalty,
loyalty, including
including Target Gets the Most out of Its Guest Data to
Target’s
Target’s current
current portfolio
portfolio of
of Improve Marketing ROI”)
loyalty
loyalty programs
programs such
such as
as the
the • Executive sponsorship of professional, in-house
popular
popular savings
savings app,
app, Cartwheel,”
Cartwheel,” network of analytical team members that
•• Hired
provides mentoring, skill development, and
Hired January
January 2016
2016
•• Experienced collaboration (e.g., Target Analytics Network)
Experienced in
in retail
retail data
data
analytics
analytics
DELTA
ANALYTICAL COMPETITOR

• Communicating Guest insights into Value

o Personalized coupons based on
visits/purchases
o Community driven weekly ads
o Focus on the community to provide “one
stop shop” for Guests needs

• Focus on Value
o 2016 Holiday plan increases 20% [year
over year] on the value category

• Mobile Localized Intelligence

o Increase usage and redefining stores and
fulfillment centers remote Guests
 DELTA
ANALYTICAL COMPETITOR

Casey
Casey Carl
Carl Paritosh
Paritosh Desai
Desai
Uses
Uses his
his “background
“background in in designing
designing and
and
Oversees
Oversees enterprise
enterprise strategy,
strategy, innovation,
innovation, delivering support systems using various
delivering support systems using various
data
data analytics and business intelligence, as
analytics and business intelligence, as advanced
advanced analytics
analytics algorithms”
algorithms” inin the
the
well
well as
as new
new business
business integration
integration andand retail
retail industry
industry to
to accelerate
accelerate Target’s
Target’s data,
data,
operations
operations with
with aa “main
“main goalgoal of
of ‘infusing
‘infusing aa analytics, and business intelligence
analytics, and business intelligence
digital
digital Mindset’
Mindset’ inin aa company
company that that has
has capabilities
capabilities byby leading
leading aa center
center of
of
long
long been
been defined
defined by by brick
brick and
and mortar
mortar excellence.
excellence.
operations.“
operations.“

Chief Strategy & Information Officer Senior Vice President,

Enterprise Data, Analytics, & BI

Ujjwal
Ujjwal Sinha
Sinha Andrew
Andrew Pole
Pole
“Led
“Led aa 500+
500+ person
person analytics
analytics team
team that
that Studied
Studied data
data using
using machine
machine learning
learning
was responsible for all BI and analytics
was responsible for all BI and analytics algorithms
algorithms to “identify and locate Target’s
to “identify and locate Target’s
functions,
functions, including
including predictive
predictive analytics,
analytics, ideal
ideal market,
market, informing
informing its
its marketing
marketing
optimization,
optimization, data
data science,
science, big
big data,
data, data
data strategy
strategy and
and overall
overall reach,”
reach,” which
which led
led to
to
quality, business intelligence and reporting
quality, business intelligence and reporting controversy around their use of data
controversy around their use of data
across
across all
all business
business functions
functions ofof the
the entire
entire mining.
mining.
company.”
company.”

Vice President, Director, Guest Management

Enterprise BI & Analytics
 Strengths & Weaknesses

Strengths Weaknesses
• Expertise in digital advertising • [International] E-commerce sales
• Number/variety of tools available to • Wide variety of product offerings
capture customer activity • Store associates’ application of analytic
• Algorithms and predictive analytics insights
techniques • Supply chain optimization
• Enterprise use of analytics • Grocery offering
SWOT differentiation

Analysis
Opportunities Threats
• Expanded online and mobile offerings • Data breach recovery
• Exploration of new technology: • Competitor advancement in emerging
o Wi-Fi/RFID generated heat maps technologies (i.e., Walmart Pay)
o Internet of Things • Competitor advancement in analytics
o Artificial Intelligence (i.e., WalmartLabs)
• Expanded use of competitive shipping • Competitor acquisitions
options/services (i.e., Walmart’s acquisition of Jet.com)
 DELTA
Moving to the Next Level

D •  Continue to invest into big data and predictive analytics tools

•  Emphasize use of digital dashboard and visualization solutions

E • Benchmark current analytical maturity level for future research/improvement

• Integrate data across business functions, including social media and public census
information

L • Continue creating “centers of excellence”

• Fill future open leadership positions with data-driven individuals

T • Jeff Jones improving “Guest experience”

• Support within the community with Community Relations, Global Affairs and Sustainability
teams as well as Target Foundation

A • Create a rotational program (e.g. Walmart)

• Find middle-ground between the current organizational structure and retraining or re-
staffing analytical positions