Is Target Australia having an identity crisis?

Target use to occupy the middle space between high end retailers and the lower end of the market. But anyone who has seen their ads on TV lately, could be forgiven for thinking the retailer has gone down market in 2013, with cheaper prices and massive markdowns to rival Big W and Kmart.

But then a media release appeared this morning announcing the launch of a new ad campaign from Target, featuring fashion stylist Gok Wan (pictured), as a “style and quality” ambassador.

Gok Wan will appear in a series of television commercials for the retailer, with the first to hit screens on Wednesday 10th July, “focusing on a fresh and classy way to dress for the workplace”.

It seems to me that the people at Target can’t quite make up their mind what they want the retailer to be. Is it a discount department store selling everything but the kitchen sink? Is it a trendy boutique for fashionistas? Perhaps a budget clothing imporium for mum, dad and the kids? Or a new player in stylish womenswear for the office? Apparently, Target wants to be all these things and much more.

By their own admission, target Australia has opted to revitalise the brand by adopting the riskiest strategy in business: trying to be all things to all people.

Managing Director of Target Australia, Stuart Machin said “I think Gok represents everything we want Target to be – fun, modern, stylish, with something for everyone.”

“Our customers have told us that they love Target, but they want more from us. They want more style, more quality, more excitement instore – and they expect to pay less.”

But Stuart, you can’t keep 100% of the people happy, 100% of the time.

Perhaps Stuart Machin should have a chat with the CEO of Kmart Australia, Guy Russo, the man who successfully revitalised Kmart after he took over the business in 2008.

Guy Russo told me in 2012: “We were trying to be all things to all people and when you you try to do that, it won’t work. So we decided let’s be great at being the low end retailer and let the high end retailers do what they do best.”

The problem for Target is that the mid-price range segment of the market has all but disappeared, taking most of their customers with it.

Trying to “be great at being the low end retailer” puts them in direct competition with Kmart, which like Target, is owned by Wesfarmers. Going upmarket isn’t an option. As the higher end retailers like Myer and David Jones will tell you, in the current economic climate, consumers care more about price than quality.

I don’t have an answer. But what I do know, is that any business which tries to be all things to all people is doomed to fail.

Let’s hope Target will be able to find their feet and re-position themselves in the market. It would be a real shame to see another Australian retailer disappear from our shopping malls.