Italy and Target

1. Italy and Target Gill Small, Heather Kaye, Megan Daugherty, Brianna Decarmine

2. Company History • Founded by George Dalton • Incorporated in 1902 in Minnesota • First store was named Goodfellows • Dalton Corporation opened the first two level in door shopping mall in 1910.

3. Company History Cont. • Dalton Corporation opened the first target store in 1962. • Target went public in 1967 • First SuperTarget, opened 1995 • www.target.com was launched , 1998

4. Business Description • Target is a US based company. • 1,395 Target stores • 218 SuperTarget stores. • International and domestic Vendors. • 30% of merchandise is imported. • Softline and Hardline merchandise.

5. Private Label Brands

6. Licensed Brands

7. Services • Target.com • Target Commercial Interiors • Target Financial Services • Target brand Credit Cards • Target Visa • Target Check Card • Target Card

8. Services Continued • Associated Merchandising Corporation • Target Sourcing Services • Pharmacy • 1,300 currently operating • Target Clinic • Fully licensed staff of a Physicians Assistant and Nurse Practitioners. • Located in metro areas • Opened in 2006

9. SWOT Analysis • Strengths • Strong brand Identity and market presence • Wide Variety of products • Strong Brand Mix • Weaknesses • Lack of Quality Control • Opportunities • Moving Overseas • Threats • Decline in consumer confidence

10. Italy the Basics • Located in southern Europe, borders 5 countries • Slightly larger then Arizona • Main climate: Mediterranean • Official Language: Italian • Population: 58,145,320 • Main religion: Roman Catholic

11. Brief History • 1st century BC: Romans • 6th century: Lombard's • 1796:1813: Napoleon & French Rule • 1882: Triple Alliance was formed • 1914:WWI begins • 1925-1946: Mussolini and the Fascist Party • 1946: Republic formed • 1955: Joined the United Nations

12. Government • 3 branches: executive, legislative, judicial • President is elected by the electoral college • 7year terms with no limit on terms served

13. Education • Divided into three parts • Infant cycle: ages three to six • First cycle: 8 years, mandatory • Mandatory training cycle • Continuing school • Vocational training • apprenticeship

14. Social Event Norms • Always dress formally even if non-formula • Lateness acceptable • Always take a 2nd helping • Bring a gift • Do not send Chrysanthemums or red or yellow flowers • When gift wrapping stay away from black and purple

15. Business Norms • “Bella Figure” or good image • Acceptable dress • Calling Cards • Trust is important • Northern Italy: time is money • Southern Italy: Laidback

16. Economy Statistics • GDP: $1.8 Trillion • GDP Per Capita: $30,900 • Composition of GDP: • 70.9% Services • 27% Industry • 2% Agriculture • Inflation of Consumer Prices: 1.8% • Separation between the northern and southern parts of Italy • North: Industrialized • South: Agriculture • Labor force: 24.74 Million Workers • Services: 63% • Industry: 32% • Agriculture: 5% • Unemployment: 6.2%

17. Economy Statistics • Population: 58,145,320 • Growth Rate: -0.019% • Birth Rate: 8.36 births per 1,000 • United States: 14.16 births per 1,000 • Median Age: 42.9 years • 0-14 years: 14.6% • 15-64 years: 66.3% • Over 65 years: 20%

18. Agriculture • Employs roughly 1.4 million workers. • North produces grains, sugar beets, soybeans, meat and dairy products. • South produces fruits, vegetables, olive oil, wine and durum wheat. • Farms are small, usually only around 17 acres in size. • Main economic strength lies in processing and manufacturing. • 80% of country’s energy sources are imported.

19. Trade Unions • Make up about 40% of work force. • The four confederations are the General Italian Confederation of Labor (CGIL), the Italian Confederation of the Workers' Unions (CISL), the Italian Union of Labor (UIL) and the General Union of Labor (UGL). • Strongest being the CGIL • These confederations were all originally affiliated with major political parties but they have now shifted to becoming fully independent and professional organizations. • Helped to achieve a wage indexing system, common job classification, paid maternity leave, more paid holidays, guaranteed severance pay and a shorter work week (37 hours).

20. Trade • Trades closely with other members of the European Union. • Makes up 54.4% of country’s trade • Largest trade partner is Germany, at 15.5% • Next is France at 11.6% • UK at 5.9% • Italy is the United State’s 11th biggest trade partner • Totaling $42.5 billion • $11.5 billion exports • $31.0 billion imports • Trade Deficit with US: $19.5 Billion

21. Media • Television: RAI and Mediaset • Control 85% of audience and 90% of advertising revenues • Mediaset owned by Mr. Marina Berlusconi • Two Ad Agencies: Publitalia '80 and Digitalia '80 • Digital broadcasting shift by 2011 • Written press is very sectionalized. • Local papers prevalent • Low readership • Due to the fact that the written press only controls a small portion of the advertising market. • Radio is gaining popularity. • Dominated by two public stations, which are two divisions of RAI RadioUno and RadioDue. • Internet users numbering 32 million. • Cell phone users numbering over 78.571 million.

22. Retailers • Conad (Consorizio Nazionale Dettaglianti) is a large Italian based retail brand which operates one of the largest supermarket chains in Italy. • 2,850 stores • Auchan is a retail group and multinational corporation based out of France, though it has branches operating in Italy. • 47 hypermarkets, 275 supermarkets • SMA Supermercati is a division of Auchan and operates three supermarket chains, SMA, Cityper and Punto SMA. • Carrefour, also a French based international hypermarket chain, first opened it's doors in Italy in 1993. • 59 hypermarkets, 485 supermarkets, 1,015 convienence stores and 20 cash and carry stores. • Ebay Italia

23. Strengths • Italy over the past few decades has slowly become more industrialized, • If Target were to enter the Italian market it is evident that there will be plenty of money to be spent by consumers. • Since the Italian market is relatively similar to the American market advertising of our stores could be similar, for example we would be allowed to advertise on television (where in most countries it is government regulated) similarly to the way we advertise in the United States. • Target can also take advantage of the Italian internet. Italy has over 32 million internet users, and this is a great way to get products to customers who are not available to travel to the stores, or who would rather shop from home.

24. Weaknesses of Target as perceived by intended consumers • Target is an American brand, and with the name Target comes the American label. • Unemployment remains a constant problem in Italy, It is important that if we do establish our brand in Italy that we do demographic research and pinpoint the locations where unemployment rates are at their highest, and steer clear of basing our retailer there. • Italy is clearly divided into two sections, Northern Italy which is more industrial based, and Southern Italy which is more agricultural based.

25. Opportunities of Target as perceived by intended consumers • With such a rapidly growing economy Target should enter the market to try to gain a piece of Italian retailing wealth. • The average age in Italy is between fifteen and sixty five • Like stated in the Strengths the Italian society has a great opportunity with the media to advertise, from magazines to television getting the Target name out to the consumer will not be a problem • Italian culture the work week can be up to a seven day work week

26. Threats of Target as perceived by the Italian consumer • To the Italian consumer the introduction of an American retailing chain may be a direct threat to the culture that so many worked so hard to build. • Italian-based competitors • Conad • Auchan • Carrefour

27. Advertising • TV • Magazines • Urban Areas • Where we want to put our locations • Urban/Suburban

28. Pricing • Low pricing • Under market pricing

29. Competitor • Carrefour • European Market Saturation • Similarities/Differences