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Target wants to be more like Costco

Target wants its customers to expect more. It's strategy going forward is to lower its price image by adding big bulk warehouse items. But Jennifer Collins reports it still has work to do if it wants to compete with the king.

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Bill Radke: This morning, Target releases quarterly earnings, one of many retail chains reporting this week. Marketplace’s Jennifer Collins says retailers still have some convincing to do to get customers back into stores.


Jennifer Collins: Remember this Target ad?

Target Ad: Expect more, pay less.

Retail consultant Burt Flickinger says Target now wants it customers to expect a lot more. Think: Costco.

Burt Flickinger: Target’s trying to lower its price image by adding big bulk warehouse items.

Flickinger says the strategy may help, but Costco will probably remain the king of 36-pack toilet paper.

He says stores have to push bargain items to bring in buyers. Take Saks Incorporated, which reports earnings tomorrow. Its high-end stores, Saks Fifth Avenue, have recently been promoting affordable brands from the likes of, say, Michael Kors.

Daniel Butler is with the National Retail Federation:

Daniel Butler: Every retailer is looking at the consumer’s perception that has evolved and the consumer right now is much more focused on: “Is this product the right price for the value?”

And he expects consumers to remain frugal for many more months.

I’m Jennifer Collins for Marketplace.

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