Will Price-match Promise Help Boost Target?

Jan 09, 2013 4:37 PM  By

Target announced plans this week to price match top online retailers year-round, extending a policy it installed for the holiday season.

If a customer buys a qualifying item at a Target store and then finds the identical item for less in the following week’s Target circular or within seven days on Target.com, Amazon.com, Walmart.com, Bestbuy.com or Toysrus.com or in a local competitor’s printed ad, Target will match the price.

While online price match policies can be difficult to implement, in order to stay competitive, retailers must provide a seamless approach both online and offline to shopping, says Tom Nawara, VP at Acquity Group.

“In order to stay competitive, retailers must provide a seamless approach both online and offline to combat showrooming,” Nawara said. “Appealing to customers’ needs at competitive price points is an imperative step for retailers looking to drive sales year-round.”

But will this price-match program help Target, which reported flat December sales with the price-match policy in place, win loyal customers? In an analysts blog post about Target’s price matching policy, Zacks Equity Research.

“We observe that the price matching strategy, which was introduced in the holiday season, did not fetch the desired results,” the blog post read. “The company’s December comparable-store sales numbers came in flat that fell short of management’s expectation of a low-single digit increase, although it showed a marginal improvement over a 1% decline in comps witnessed in November 2012.”