Target Redcard
Target’s REDCard
Executive Summary:
With Target being the second largest retailer, the hopes and dreams of being number one are not out of reach. By increasing the volume of existing and new customers and by adding value, Target will be able to see more loyalty from their guests. We wanted to develop a long term strategy that would attract new customers as well as retain and strengthen the already well established competitive advantage. The REDcard, with its current benefits, stands to promote customer loyalty, so we feel that by taking advantage of an already great program and making it a little better, it would increase value and the competitive advantage.
The Target REDcard’s current benefits include a 5% discount on practically every purchase everyday in the store or online. It also allows customers to withdraw up to $40 cash over the amount of their purchase, and with every 5 prescriptions a customer pays for with their Target debit card, they will get a 5% off shopping day which is on top of the 5% they already get by using their REDcard. Customers also have the choice of having Target donate 1% of the amount purchased with the debit card to eligible k-12 schools of the customer’s choice.
Our idea is to expand on the REDcard and make it more worthwhile to their customers, by adding a points reward system. Offering a points program to customers will draw in more traffic and increase revenue for Target. The program is a great way to maximize the value customers get when shopping at Target. Among this enhancement it will increase revenue and profitability by understanding and identifying customer buying habits, as well as reward customers for increasing their purchases. Research has stated that customers are more likely to spend more money in the store knowing they will get rewarded back for doing so. The points system would give one point per dollar spent, and as these points accumulate, the customer would be able to use these points as
Executive Summary:
With Target being the second largest retailer, the hopes and dreams of being number one are not out of reach. By increasing the volume of existing and new customers and by adding value, Target will be able to see more loyalty from their guests. We wanted to develop a long term strategy that would attract new customers as well as retain and strengthen the already well established competitive advantage. The REDcard, with its current benefits, stands to promote customer loyalty, so we feel that by taking advantage of an already great program and making it a little better, it would increase value and the competitive advantage.
The Target REDcard’s current benefits include a 5% discount on practically every purchase everyday in the store or online. It also allows customers to withdraw up to $40 cash over the amount of their purchase, and with every 5 prescriptions a customer pays for with their Target debit card, they will get a 5% off shopping day which is on top of the 5% they already get by using their REDcard. Customers also have the choice of having Target donate 1% of the amount purchased with the debit card to eligible k-12 schools of the customer’s choice.
Our idea is to expand on the REDcard and make it more worthwhile to their customers, by adding a points reward system. Offering a points program to customers will draw in more traffic and increase revenue for Target. The program is a great way to maximize the value customers get when shopping at Target. Among this enhancement it will increase revenue and profitability by understanding and identifying customer buying habits, as well as reward customers for increasing their purchases. Research has stated that customers are more likely to spend more money in the store knowing they will get rewarded back for doing so. The points system would give one point per dollar spent, and as these points accumulate, the customer would be able to use these points as