Target apologizes to Canadian shoppers

The Target (NYSE:TGT) apology tour continues as the retailer issues a mea culpa to Canadian customers following its bungled market entry there.

"Maybe we didn't put our best foot forward when we entered into Canada. We had some disappointments when we opened. Certainly we think we disappointed our guests," said Damien Liddle, Target Canada's senior corporate counsel, in a video clip posted to YouTube. "But here at headquarters and at our store teams we're working really hard to give everybody that unique Target experience."

Target made many mistakes during its first year north of the border. Stores were plagued by inventory management issues that led to out-of-stocks, while prices were uncompetitively high.

But changes are in the works.

Tony Fisher, president of Target Canada, was replaced in May by Mark Schindele, formerly Target's senior VP for merchandising operations. There are also plans to bring in a new non-executive chairman in Canada to provide counsel and support to executives there.

Target has also shaken up its executive suite on a lot of levels, starting at the top with the departure of former CEO Gregg Steinhafel. The retailer is also relocating and renaming its executive committee in an attempt to break the bureaucratic barriers put in place by prior leadership.

All top executives are being moved to new offices on the same floor of its Minneapolis headquarters in an effort by Interim CEO John Mulligan. The executive committee will now be called the "leadership teams," according to a memo announcing the changes.

Four longstanding groups within the organization are targeted for change. The supply chain council, prototype council, design committee and capital expenditure committee are being restructured to eliminate a layer in the approval process.
 
"All across Target, we need more 'leadership' and less 'committee,'" Mulligan said in a memo reviewed by The Wall Street Journal.

This isn't even Target's first apology. Chief Merchandising Officer Jeff Jones addressed public criticism of the company's culture and, rather than defending the status quo, acknowledged that change was needed at the retailer in a reply posted on LinkedIn. Jones said the criticism would be used to fuel improvements.

"The culture of Target is an enormous strength and might be our current Achilles heel," Jones wrote. "In the coming days and weeks we will embrace the critiques of Target — whether it's from outsiders or our own team — like an athletics team puts the negative press on the wall in the locker room."

Apologies and executive changes are a start, but Target's meaningful change won't be measured until it affects financial performance.

Traffic to Target stores has declined for six straight quarters, and the retailer has lost nearly $1.6 billion since its entry into Canada last year. And then there's the ongoing recovery efforts following a massive data breach that compromised the personal and credit card information of more than 70 million shoppers.

For more:
-See this YouTube video
-See this LinkedIn post
-See this CNBC story

Related stories:
Target CEO shakes up executive committee
Target: It's time for a turnaround
Target launching millennial-focused registry, adding mobile features
Target leads m-commerce growth
Target gets serious about its digital transformation

 

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