Another Retailer Goes Down: Target is Badly Bleeding Red Ink

Yesterday we highlighted retail-apocalypse discretionary spending troubles in Legos and Disney. Today, the very heart of the American budget is at stake. Retail giant Target finds itself in in a desperate scramble to stop the bleeding, and they may have just made it worse…

from Zero Hedge

Amazon may have the most razor thin margins in the entire retail world, but that doesn’t mean that its peers can’t catch up as the global race to the deflationary bottom enters its final stage.

Moments ago, that’s precisely what Target did when it announced on its blog that it has taken a “close look” at products most important to its customers to ensure they’re priced right daily, and has cut prices on “thousands of items.” The company also unveiled that it has “eliminated more than two-thirds of our price and offer call-outs so you can more easily spot the savings” and that it is not “ditching promotions.”

In short, Target just pre-preannounced that it will very shortly be guiding both margins and earnings much lower. The only question is whether Amazon will allow it to expand revenues by enough to offset the bottom line drop.

Judging by the market, the answer is no…




… and not only at Target, but the entire retail sector has been similarly crushed as Amazon takes another multi-billion chunk in market cap from of its competition.



Below is the full Target blog post that inspired today’s retail bloodbath:

 Pssst… Here’s How to Save Big During Your Target Run (And There’s No Math Required!)    

 If you love Target for incredible exclusive brands, super-chic collaborations and one-stop shopping for pretty much everything on your list, you’re going to really love this: We’ve lowered our prices on thousands of items, from cereal and paper towels to baby formula, razors, bath tissue and more.

 Sure, there’s nothing like that victorious rush of nabbing a spectacular deal, but having to figure out what “As Advertised!” and “Temporary Price Cut” mean or waiting for just the right sale to roll around can be, well … super frustrating.

 So, we’ve put our prices and promotions under the microscope. Our mission? To cut through the clutter and provide guests with great everyday value, while continuing to offer additional savings on the right products at the right times.

 “We want our guests to feel a sense of satisfaction every time they shop at Target,” says Mark Tritton, Target executive vice president and chief merchandising officer. “Part of that is removing the guesswork to ensure they feel confident they’re getting a great, low price every day. We’ve spent months looking at our entire assortment, with a focus on offering the right price every day and simplifying our marketing to make great, low prices easy to spot, all while maintaining sales we know are meaningful to guests. And guests are taking note, appreciating much easier, more clear—and more consistent savings—at Target.”

 Ready for a few tips for saving big every day at Target?

  • Fill your cart with confidence. Go ahead, choose from thousands of items, from milk and eggs to crayons, markers and more … and simply drop them in your cart. We’ve taken a close look at the products that are most important to our guests, making sure they’re priced right daily.
  • Watch for simple, easy messages. Say goodbye to all those little signs and ads letting you know about the “Weekly Wow!” or “Bonus Offer.” We’ve eliminated more than two-thirds of our price and offer call-outs so you can more easily spot the savings.
  • Delight in the right sales. Don’t worry—we’re not ditching promotions! We’re just making sure to offer only our best, most compelling sales—when it makes the most sense for our guests.

 Here’s to even happier Target runs—and a break for your budget!