Target Fires Latest Shot in the Price Match War

Peri is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

With the growth in smartphones over the last few years, “shopping” has taken on a whole new meaning.  Once upon a time, you sat down and looked over your Sunday circulars or visited your favorite discount store to pick up the best deals.  Now, all you have to do is walk in, point the bar code scanner on your phone at a UPC tag, and have your favorite app find the lowest price around – whether in stock at a local retailer or online … as Best Buy (NYSE: BBY) will be all too (un)happy to attest to.

The electronics retailer is probably the poster child for what has become known as “showrooming,” visiting a retail store to see and try a product before buying it more cheaply elsewhere, usually online.  Many analysts attribute Best Buy’s years of underperformance to the practice, and management seems to agree, instituting a price-match policy for this past holiday period from November 27 through December 24, meeting the prices of Amazon.com (NASDAQ: AMZN) and traditional brick and mortar retailers.  


Now, Target (NYSE: TGT) has taken the tack even further, announcing it will match prices year-round, and cover both neighborhood and online competitors -- including its own website.  In addition to Amazon.com and BestBuy.com, Target will match prices from Walmart.com (NYSE: WMT) and Toys R Us.com, along with its Babies R Us.com division.

Target is hoping that instead of bringing your store-gained knowledge home and buying the product online, you’ll bring your smartphone up to Guest Services and they’ll match the price for you right there.  They'll make the sale and you get your item immediately.  The offer stands for seven days after you buy something in the store, as well, with Target hoping you won’t hesitate to pick up an item you see before being able to do the price research first.

Not everyone is convinced the change will have the desired effect of cutting down on showrooming and increasing store sales, pointing to Target’s disappointing holiday sales performance, when they did price-match across the board.  Critics say it’s largely a PR move that won’t seriously impact consumer behavior. 

But if it’s true that perception is reality, for shoppers, this move may be … right on target.


RadioPeri has no position in any stocks mentioned. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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